"Mobs, Messiahs, and Markets: Surviving the Public Spectacle in Finance and Politics"

"Mobs, Messiahs, and Markets" by William Bonner and Lila Rajiva is not your typical personal finance book and that might be one of the bigger understatements we've made in a long time. Yes, in the last quarter of the book it does finally give you more or less concrete information that you can apply to managing your financing. So what's the other 75%? Surprisingly, it is a very entertaining walk through historical blunders created by mob behavior and blind crowd following. The lesson of course is that when Google hits $700 and every analyst in the world is screaming for you to buy, you might want to in fact be doing the opposite.

Being contrary to the market is nothing new and we wouldn't be reviewing the book if that is all they have to add. What makes this book unique, is the literary economical approach they have taken to the subject.

From ancient Rome through the Fed policies of Alan Greenspan, the book explore mass and irrational behavior--often fueled by a compliant media only too happy to sell newspapers. Time after time, from the Crusades to the more recent idolizing Marxist guerilla Che Guevara by fashionable t-shirt wearing teens and celebrities, large swaths of public opinion have been so wrong that centuries later we can only scratch our heads wondering what were we thinking.

Most literary explorations of group think focus on the Bay of Pigs. While this book touches on that briefly (and uniquely from the perspective of the other side), the books examples are far more entertaining. In addition to the ones already mentioned, the authors explore witch trials, the McMartin Preschool trial, neoconservatism, to name a very few.

In the end, the personal finance message can be distilled down to something like this. Avoid the hoopla and hype. Do your homework. You should know what something is worth and whether or not it is a good deal. Don't expect a lot of help from "experts" or the media since they have their own agendas. If someone wants to sell you something you probably don't want to buy it.

Anyway you get the idea. Having suffered through a few very dry and very derivative personal investment books I found this book to be refreshingly and irreverently different.

Amazon link: Mobs, Messiahs, and Markets: Surviving the Public Spectacle in Finance and Politics (Agora Series)

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