Here is a list of the top 100 financial history books as voted by members of the Museum of Finance. Top ten are listed below with the summary, followed by a list of the other 90 – enjoy!
Financial History Books #1: Reminiscences of a Stock Operator
Author: Edwin LeFevre
Year of Publication 1923
Still in print 88 years after first being published, there is no small irony that the top-ranked book on this list is, technically, fiction; nor that it exposes the wretched excess and carnival atmosphere of the financial markets. Has nothing changed? How far from this cautionary tale have we come? Michael Milken? Bernie Madoff? Those miscreants were real, as was trader Jesse Lauriston Livermore, the thinly-disguised subject of Reminiscences. In the tradition of Daniel Drew, Livermore was a bear raider, known as The Great Plunger, a sewer of fictional value and confidence. The quality of Reminiscences, however, is palpably real. The language, while a little dense, is redolent of the age, and the chapter format is practically a how-to guide.
Financial History Books #2: The Big Short
Author: Michael Lewis
Year of Publication 2010
Journalism is called the first draft of history. This recent book, destined to become a definitive classic of our time, is one of those rare cases where the same reporter who did the original work also got to go back and finish the job. Lewis details — clearly and thoroughly — the backstory of how the demons of financial engineering like collateralized debt obligations were first summoned and then escaped into the wider economy. This is a brave and unapologetic work, proving two things: that people dealing with billions of dollars in someone else’s money should take a Hippocratic Oath, and also that in some reporting there is not such thing as objectivity, only fairness. If that strays from the sepia-toned view of journalism then Lewis restores the luster with his exhaustive research and corroboration. Reading it is like reading The Guns of August: the outcome is known, but the venality and callousness and that lead to it are gut-wrenching.
Financial History Books #3: Manias, Panics, and Crashes
Author: Charles Kindleberger
Year of Publication 1978
To laugh or cry? Kindleberger is a mighty foil to the prevailing moods of the dismal science: even the best books on financial history tend to be deadly earnest or tediously self-righteous. Manias is clever, witty, wry. If we are all fools for love, we are also fools for money. To be sure, the scholarship is as rigorous as any other work on this list. But it is delightful in that all this insight and analysis comes through a light turn of phrase and fluid writing. Dick Sylla, chairman of the Museum’s board of trustees, wrote of the current, fifth edition: “What long has been the best history of financial pathologies is now even better. The reader who absorbs Kindleberger’s lessons will be prepared to foresee and navigate the financial crises that surely lie ahead. Like a true classic, Manias is both timely and timeless.”
Financial History Books #4: A Monetary History of the United States 1867–1960
Author: Milton Friedman and Anna Jacobson Schwartz
Year of Publication 1963
Find “definitive” and “authoritative” in the dictionary and there will be a picture of this book. In March 2004 then Fed Governor Ben S. Bernanke delivered the H. Parker Willis Lecture in Economic Policy at Washington and Lee University in Lexington, Virginia. He said of this book, “Friedman and Schwartz offered important new evidence and arguments about the role of monetary factors in the Great Depression. In contradiction to the prevalent view of the time, that money and monetary policy played at most a purely passive role in the Depression, Friedman and Schwartz argued that ‘the [economic] contraction is in fact a tragic testimonial to the importance of monetary forces.’” Bernanke’s homage is remarkable in light of the fact that Friedman and Schwarz are fearless and assertive in their critique of the Federal Reserve through and after the Crash of 1929.
Financial History Books #5: Extraordinary Popular Delusions and the Madness of Crowds
Author Charles Mackay
Year of Publication 1841
In his introduction Mackay writes of “whims and peculiarities,” as if he were referring to fashion or music. He then cites the Crusades and witch hunts as deadly examples of mania and social madness. This fondly familiar classic was the original financial history for broad audiences. The voice is avuncular, the tone gently chiding. Mackay finds our financial faults lie not within our stars but within ourselves. Still in print, it encourages investors in a solid Victorian mindset to rise above their base nature and be creatures of thought rather than instinctive fear and greed. The quotable line, to use a film reference is: “Men, it has been well said, think in herds; it will be seen that they go mad in herds, while they only recover their senses slowly, and one by one.”
Financial History Books #6: Alexander Hamilton
Author: Ron Chernow
Year of Publication 2004
When have 730 pages ever flown by so quickly? Hamilton is the patron saint of American enterprise, and here Chernow has given him the definitive biography. It tells enough of the times so that the life is related all the more finely. The writing is brisk and accessible, but is rich in vocabulary. Chernow is clearly an admirer of Hamilton, but the presentation is fair and balanced, not glossing over any of the man’s misjudgments. Other biographers have tended to emphasize Hamilton’s war record — he led the charge at Yorktown — and on the battles over assumption. Chernow honors those but gives full glory to Hamilton’s role as President Washington’s most trusted advisor, and also as a key enabler of the Constitution—far beyond just his role in writing the Federalist Papers. (full review in Financial History, issue 86, Fall 2004).
Financial History Books #7: Enough: True Measures of Money, Business, and Life
Author: John C. Bogle
Year of Publication: 2008
Like Theodore Roosevelt, John Bogle is both a wealthy man, and a harsh critic of the malefactors of great wealth (as TR called them). For the founder of the multi-squillion-dollar Vanguard Funds, Bogle decries the “counting culture” in America. He delights in calling earnings-per-share, slavishly followed as The Number, as essentially fictitious. Bogle talks about character, and societal issues and outrage. Bogle lays bare the insatiable avarice that drives financial operators to ever-greater levels of cost and complexity. Not the kind of thing that Captains of Industry usually bother with. Yet no less a stalwart than Barron’s praised Enough, saying it it was “a rabble-rousing, world-changing work like Common Sense and The Communist Manifesto.”
Financial History Books #8: The Intelligent Investor
Author: Benjamin Graham
Year of Publication: 1949
Before there was Buffett, there was Graham. First published in 1949, the Sage of Omaha read it the following year when he was 19 and has since called it “by far the best book on investing ever written.” The revised edition, updated and featuring commentary from Jason Zweig, member of this magazine’s