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Season 2, Episode 35: How Bubbles and False Narratives Made Financial Markets

With Jamie Catherwood, Author of InvestorAmnesia.com

With the Dow Industrial Average hitting 30,000 on the day of this recording, revisiting historical booms and busts feels particularly timely.

Jamie Catherwood, the author of InvestorAmnesia.com and a self-proclaimed financial history nerd, is a perfect guide to this discussion.

We discuss booms in treasure hunting, bicycles, railroads, breweries, and of course tulips (which it turns out was greatly exaggerated. The guest debunks this).

Content Segments

  • What epoch in financial history is perhaps most apt in light of today’s period? (3:38);
  • How long do these cycles typically last? (12:40);
  • Bubbles in transportation technology: bicycles, railroads (twice), now electrical vehicles (16:25);
  • “Tulip mania,” often cited as the “mother of all financial bubbles” was in reality nowhere near as crazy as commonly believed (18:40 );
  • What are common elements that prick bubbles? (27:08);
  • The role of central banks and the money supply in the bursting of bubbles (29:59);
  • Background on the guest (40:36);
  • How he started his website on financial bubble history (45:44)
  • Contrarian investors through history (51:59);
  • Epilogue: bonus content for supporters of Tottenham Hotspur only (57:05).

More Information on the Guest

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