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EspressoLover


Total Posts: 240
Joined: Jan 2015
 
Posted: 2017-09-27 14:04
Maybe. But 1929 probably falls on the tech side of that spectrum. The roaring 20s were mostly driven by mania for petrochemicals, electrifications and automobiles. Then 1873, which precipitated the worse depression of the 19th century, was also pretty tech'ish. At least if you consider railroads tech.

The relatively contained crises of 1884 (over leveraged bank loans) and 1890 (LatAm debt) were pretty close to the leveraged-asset end of the spectrum.

iasmath


Total Posts: 43
Joined: Feb 2010
 
Posted: 2017-10-02 02:14
The WSJ link was great especially to the book it pointed to (Manias, Panics and Crashes.. A History of Financial Crises - Kindleberger C.P., Aliber R.Z). I believe the authors of the book would choose this part to post here:

"Minsky noted that 'euphoria' might develop at this stage. Investors buy goods and securities to profit from the capital gains associated with anticipated increases in the prices of these goods and securities. The authorities recognize that something exceptional is happening in the economy and while they are mindful of earlier manias, 'this time it's different', and they have extensive explanations for the difference. Chairman Greenspan discovered a surge in US productivity about a year after he first became concerned about high level of US stock prices in 1996; the increase in productivity meant that profits would increase at a more rapid rate, and so the higher level of stock prices relative to corporate earnings did not seem unreasonable."

"When we pull back the curtain, we see that the wizard is just a man, but also that the man is a wizard"
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