Extraordinary Popular Delusions

“Today, as in the time of the South Sea Bubble, human nature is drawn like a moth to a flame by the speculative fads of the marketplace. The excitement of new glamour issues in electronics or medical technology and the general euphoria over a rising market can lure even the most experienced investors. Their optimism overcomes their better judgment. They abandon critical analysis of the investment’s fundamental value. Like gamblers in a casino, they play against the odds, paying inflated prices and dreaming of quick profit.” -from the foreword by John Marks Templeton.

Mackay’s classic, first published in 1841, studies the psychology of crowds and mass mania throughout history, including accounts of classic scams, grand-scale madness, and deceptions. Some of these include the Mississippi scheme that swept France in 1720, the South Sea Bubble that ruined thousands in England simultaneously, and the tulip mania of Holland when fortunes were made and lost on single tulip bulbs.

Other chapters deal with fads and delusions that often spring from good ideas or causes, many of which still have their followers today: alchemy and the philosopher’s stone, the prophecies of Nostradamus, the coming of comets and judgment day, the Rosicrucians, and astrology.

Time and again, we can avoid disastrous pitfalls and learn to profit by seeing how history repeats itself. Fascinating, mesmerizing, strikingly strange, and amazingly wise, this book will never be forgotten and cannot be ignored.

Charles Mackay was a British poet, journalist, and songwriter. He was born in Perth, Scotland, educated at the Royal Caledonian Asylum, London, and Brussels, but spent much of his early life in France. Coming to London in 1834, he engaged in journalism, working for The Morning Chronical from 1835 to 1844, and then became editor of The Glasgow Argus. He moved to The Illustrated London News in 1848, becoming editor in 1852. He published Songs and Poems (1834), wrote a History of London, Extraordinary Popular Delusions and the Madness of Crowds, and a romance, Longbeard. He is also remembered for his Dictionary of Lowland Scotch.

His fame, however, chiefly rests upon his songs, some of which include "Cheer, Boys, Cheer," which were set to music in 1846 by Henry Russell and had an astonishing popularity. Mackay acted as a Times correspondent during the American Civil War and, in that capacity, discovered and disclosed the Fenian conspiracy. He earned an LLD degree from Glasgow in 1846 and was a member of the Percy Society.