TIP784: History's Biggest Market Bubbles w/ Clay Finck

27:36The problem with this approach is that when the bubble pops, there is rarely going to be ready buyers as the market is overwhelmed with sell orders by the speculators trying to get out before it's too late. Many people think that they are smart enough to get out before the crash, but few have the foresight to make such accurate predictions, leaving many investors left with painful losses. Let's transition here to discuss the second case study we'll be covering today, and that is the railway mania of 1845. At the start of this chapter, Chancellor gives further distinction between an investor and a speculator.

28:13In his view, an investor is much more interested in established business models that produce steady returns in the current state of affairs. In other words, an investor is much more interested in preserving the capital they already have and generating income off of that investment. On the other hand, speculators are much more interested in capturing a capital gain and whether they realize it or not, are less interested in capital preservation and generating income today. Inventions and novelties have always excited speculators. In the 1690s, it was the diving machine, fire engine, and burglar alarm companies.

28:53In the 1720s, it was the financial alchemy generated by companies like South Sea. It wasn't until the Industrial Revolution did we start to come across technologies that weren't nearly as limited in their application. Starting in the late 18th century, a number of innovations in the field of communications had very significant impacts on society. First, it was the canals, followed in succession by railways, motor cars, radio, aircraft, computers, and more recently, the internet. Each of these technologies also attracted fervent attention from speculators, who ironically also contributed greatly to their successful establishment.

29:34The canal age in Britain started with the completion of the Duke Bridgewater Canal in 1767, which ran around 30 miles long, and over the following two decades, more than 1 ,000 miles of canals were constructed. The first canals produced tremendous returns on capital, paid large dividends, and enjoyed soaring share prices. Furthermore, canals were beneficial to society as a whole due to lower transportation costs. In the early 1790s, speculation started to creep into this industry, and the government passed 50 acts for new canals to be built, and speculation would hit its peak around 1793. The canal media would come to an abrupt end with the recession in 1793, brought on by the outbreak of the French Revolutionary War.

30:22Canal share prices collapsed and the investment returns on the new canals turned out to be abysmal in comparison to their predecessors. By the turn of the century, the overall return on capital invested in canals went from a pre-mania level of 50 % to around 5 % as the gravity force of capitalism took hold. But canals actually were not new, as the Romans had built aqueducts centuries prior. The canal simply extended the benefits of water transportation to areas which had not previously enjoyed it. As Chancellor explains, the advent of railways, on the other hand, represented a far more significant change in the life of mankind.

31:03When the steam engines first appeared in the 1820s, they were greeted with a mixture of skepticism and trepidation. It was anticipated that locomotives would prevent cows from grazing and hens from laying eggs, that their poisonous fumes would kill birds and blacken the fleeces of sheep, and that their speeds of up to 15 miles per hour would blow passengers to atoms. Realways also faced criticism and opposition from canal owners and landowners who feared losing the value of their assets. When the Great Western Railway was proposed to connect London to Western England, both the University of Oxford and Eaton College initially refused a connection.

31:46But as they say, you cannot stop an idea whose time has come. The first wave of railway excitement began with the opening of the Stockton and Darlington, but it faded quickly as an economic downturn cooled speculation. A few years later, the success of the Liverpool and Manchester Railway proved that steam locomotives were the future, reigniting public enthusiasm and setting off a second, far more powerful railway fever. But it took several years for the public at large to truly embrace railways. In the summer of 1842, the young Queen Victoria was persuaded to make her first railway trip, which she reported to be pleasantly free from dust, heat, and crowds.

32:30And landlords realized that land lying adjacent to railway lines tended to rise in value. Then journalists suddenly started to proclaim that railways were a revolutionary advancement in the history of mankind. One man understood best how to direct the public's enthusiasm for railways to his own ends. George Hudson, who was the chairman of the York and North Midland Railway, was an energetic and abrasive Yorkshire man. By 1844, he controlled over 1 ,000 miles of railway, more than a third of the total track and operation at the time, which might be why he was coined the Railway King. Hudson closely associated himself with the advancement of railways and deliberately staged opening ceremonies to increase the public's interest as much as possible.

33:19Hudson was the chairman of several railway companies, and he managed these companies really in an unusual manner. Companies' accounts and records were kept to himself, and he would update the accounting methods to his own liking, and acted as if many business rules just didn't apply to him. While he showcased personal extravagance in display on several occasions, he also cut quarters when it came to running his own operations. For example, there was a fatal accident on the York and North Midland line, and it turned out that he had employed an elderly train driver with defective eyesight in order to save on wages.

33:55Because of his lower cost structure, he was able to pay higher prices to acquire other railways and distribute greater dividends to shareholders. By late 1844, the economy was really starting to heat up. Interest rates were at their lowest point in almost a century, and after a series of excellent harvests, corn was cheap and plentiful. Railway construction costs had also fallen, and railway revenues were rapidly rising, and the three largest railway companies were paying dividends of 10%, four times that of the prevailing interest rate. As a result, the public's interest in the railway revolution was growing.

34:31Meanwhile, the number of railway companies skyrocketed as the newspapers were flooded with advertisements for railway prospectuses. The playbook by many of these firms was to retain the majority of these shares with insiders, promote a small number of the to the public, creating a scarcity of the shares to allow them to get bid up to high prices. If the promotion was successful, prices would get bid up high, demand for shares would be oversubscribed, and this would allow insiders to eventually offload their shares to the public to lock in substantial profits. Many of the promoters of new railways appeared to only be interested in profiting for themselves.

35:10One of the things that was unique about the railway mania was that it extended outside of the metro areas. And similar to the South Sea story, part of what helped fuel the mania in speculation was the ability to use leverage, as banks provided loans against the collateral of railway shares. In several cities, new stock Stock exchanges were established for the trade of shares, and it was estimated that half a million transactions were processed daily by around 3 ,000 stock brokers. One news article explained how the amount of business being done had never been seen before. A government report published in June 1845 revealed the identity of 20 ,000 speculators who had each subscribed for more than£2 ,000 worth of railway shares.

35:55And naturally, many who were on the list had contracted obligations that were well beyond their means. Some didn't even have the intention of meeting the subsequent calls on the railway shares, simply hoping to sell the option to buy shares at a premium to someone else later down the line, and others expected to flip their shares on the open market in early trading. These speculators were known as the railway stags. Although both The Times and The Economist accepted railway advertisements, they did warn the public about the corruption of the mania and the inevitability of a crash. In particular, the newspapers attempted to draw the public's attention to the insupportable amount of capital that was required to finance the reckless extension of the railway system.

36:42By June of 1845, there were more than 8 ,000 miles of new railway under construction by the Board of Trade, which was four times the size of the existing railway system. A pamphlet published in Manchester during the summer warned of an impending crisis as workers were more interested in getting involved in the speculation rather than working on real things in the economy. Once again, the old cry was raised that speculation was distracting people from lawful occupations. There was concern that this speculation would be felt for years as the industry was consuming the nation's capital resources for construction of railways.

37:21One paper wrote, to think or dream that the present mania will subsist without a crisis the most severe ever experienced in this country would be to shut our eyes to all past experience. George Hudson, or the Railway King, he really enjoyed his success. As long as the mania continued, Hudson remained a hero to the people as he had literally gone from rags to riches and was a symbol of the get-rich-quick mentality that enthralled the nation. He celebrated his success in August by purchasing a 12 ,000-acre estate for nearly half a million pounds. That amount of money adjusted for inflation would be worth something like$100 million today.

38:01By the late summer of 1845, speculation was nearing its peak. Foreign railways were projected all around the globe, and over 100 railways were planned for Ireland. In September, over 450 new schemes were registered, and a single issue of the Railway Times contained over 80 pages of prospectus advertisements. Even after the excitement of the mania cooled, the damage was already done because enormous amounts of capital had been committed and could not easily be reversed. Railway projects kept demanding cash through share calls, forcing investors to keep paying even as share prices collapsed, which drained money from the broader economy.

38:43Shortly after, the Bank of England decided to raise interest rates by half a percent. Although the raise was small, it really signaled the end of the railway fiesta. As economic conditions worsened in 1846 and 1847, businesses failed, banks collapsed, and panic spread throughout Britain's financial system. Investors who had speculated during the boom suddenly found themselves legally obligated to fund projects that they no longer believed in, leading to bankruptcies, lawsuits, and personal ruin. The middle class was especially hit hard, with families losing savings, homes, and livelihoods as railway shares imploded.

39:21By late 1847, the situation became so severe that the Bank of England was forced to suspend its own rules to prevent a complete financial collapse. Now that the bubble had popped, the railway king started to get more scrutiny. It was discovered by investors that he had been propping up dividends by using investor capital and not the profits of the underlying business. So in essence, shareholders were sending him money, and he was sending part of it right back as a dividend. This, alongside other illusions, helped keep share prices inflated for longer than they would have otherwise. As railway revenues declined and dividends were cut, Hudson's empire unraveled quickly.

40:03There were accusations of false accounting, insider trading, self-dealing, and political bribery, exposing the significant conflicts of interest at play. It was estimated that Hudson embezzled around$70 million inflation-adjusted dollars. Share prices of York and North Midland had fallen by two-thirds from its 1845 peak and was trading at a discount to its paid-up capital. Railways had really lost their appeal, and the railway king had been dethroned. But Hudson, of course, was not the only bad actor. He was just an output of a broken system. While other regions took necessary measures to prevent such manias, private enterprises were left unchecked in Great Britain.

40:45The uncontrolled expansion of the railway system in the hands of semi-criminal entrepreneurs produced an economic catastrophe. By January 1850, railway shares had declined from their peak by an average of 85%, and the total value of all railway shares were less than half the capital expended on them. Railway dividends averaged less than 2 % of capital expended, and in the years that followed, many companies could not even afford to pay a dividend. Several railroads built in the 1840s produced very poor returns and were eventually bankrupted by the arrival of the automobile. However, the results of the mania were not entirely negative.

41:26With over 8 ,000 miles of track in 1855, this helped bring great benefits to society in the form of faster and cheaper transportation for passengers, raw materials, and finished goods, and helped bring many jobs in the industry for the years ahead. Now, this book by Chancellor was published back in the year 1999, and I think he makes an accurate comparison when he compared the railway mania to the tech bubble in the 1990s. The railway mania is one of history's first examples of how a new technology does not necessarily bring good returns for the investor base at large. If anything, it suggests that we should avoid investing in new technologies, especially when there's a lot of hype surrounding it and high levels of capital investment is pouring into the industry.

42:12One of the big differences between the internet bubble and the railway mania was that the internet bubble didn't necessarily require a lot of capital to finance. Many companies could just hire a few programmers, spin up a website, and start promoting their ideas or paying for clicks to that website. This helped enable a wave of internet startups with the hope of hitting the public markets in a blockbuster IPO. Chancellor loops in this quote at the end of the chapter from none other than Bill Gates. He said, gold rushes tend to encourage impetuous investments. A few will pay off, but when the frenzy is behind us, we will look back incredulously at the wreckage of failed ventures and wonder who funded those companies.

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46:20This is a paid advertisement. All right, back to the show. To close out the episode, let's cover one more case study. So in chapter nine, Chancellor covers the Japanese bubble economy of the 1980s. Chancellor opens up this chapter by discussing this concept of Nihonjeron. So this term roughly translates to the theory of the Japanese. This concept ties into this idea that Japan is unique and perceived differences between Japan and the West were sometimes invoked by the Japanese authorities in order to hinder the import of foreign goods. For instance, it was said that Japanese stomachs digested food differently than the West, so therefore, they were unsuited to foreign beef and foreign rice.

47:04It was even claimed that American skis were useless in Japan because the snow was different. As you read about the history of the US and other countries, one common theme that I come across is that the West tends to be more individualistic than other countries. This idea comes from how Western societies historically organized their economies, politics, and social values around individual rights and personal autonomy. In practice, this led to political systems that prioritize individual rights and economic systems that reward personal initiative and entrepreneurship. By contrast, many non-Western societies, including Japan, evolved around collective structures where social harmony and group obligations often take precedence over individual choice.

47:52In Chancellor's words, Japanese capitalism is in many respects the antithesis of the Western model. Until the middle of the 19th century, Japan remained a feudal economy, closed to the outside world with no tradition of legal rights for the individual. In the years that followed, they borrowed selectively from the West, but the hierarchy of the feudal system still remained in place. The peasant who had formally bowed to the feudal lord now served a corporate master. Individuals felt a deep sense of belonging with the companies they worked for. In an exchange for their devotion and sacrifice, explorers were rewarded by their companies with lifetime employment and promotion according to their seniority.

48:35Now, as someone who's lived in the US my whole life, reading about the Japanese economy is certainly interesting. Some companies in Japan enjoy a privileged position as they receive protection from foreign competition. The Ministry of Finance guarded the financial sector and ensured that cheap loans were available to firms that were cash-hungry and highly leveraged, and the capital would be raised from Japan's thrifty savers. As interest rates were kept artificially low by these arrangements, then companies generally paid out small dividends, so returns for Japanese investors were rather poor.

49:09Furthermore, the domestic consumer was similarly exploited by the Japanese system as imports were restricted and the cost of everyday items were therefore higher. The Japanese prided themselves on the belief that their system was less selfish and more stable than their Western counterparts. They boasted that they thought long-term and that the West pursued only short-term gains. Speculation is antitheticals to a state directed economic system and after the stock market crash and bank collapses during the Great Depression, Japanese authorities were determined to never again tolerate such failures.

49:46Nevertheless, speculation still came to Japan in the 1980s, and as Chancellor puts it here, it burrowed so deep inside the Japanese system that when it departed after a mere five years, the system was in ruins." For much of the 20th century, the US was the dominant empire globally from an economic standpoint, but by the middle of the 1980s, its position was threatened by the growing might of Japan. Japan's industrial companies were deeply intertwined with new technologies in consumer electronics and a number of other fields, and its banks were the largest in the world when measured by assets and market value.

50:26Japan was running a trade surplus and the US was running a trade deficit, and this was partially funded by Japan's continued purchase of US Treasury bills. As we know, in 1971, we entered a new monetary system as the US broke the gold standard and the dollar was free-floating. During this time period, President Nixon criticized Japan for chronically undervaluing their currency in order to make their exports cheaper. In 1980, Japan started to loosen their control of their currency with the hope of making Japan a financial center of the world alongside London and New York. In light of the deregulation happening, banks were able to offer what was referred to as token accounts that allowed customers to deposit cash and earn a competitive interest rate.

51:12So Japanese companies started to supplement the regular income from their operations with interest earned on these accounts. In 1985, 9 trillion yen was invested in such accounts, and that amount would triple four years later. Chancellor refers to the financial engineering that Japanese companies used during this time period as Zytec. Zytec created a circular feedback loop. As share prices rose, the ability to perform financial engineering increased, which helped fuel share prices to rise even higher. And this helped companies perform even more financial engineering, and so on and so forth until the entire thing unravels.

51:52More than half of the reported profits of the largest players were derived from financial engineering. Companies were raising tremendous amounts of capital at low interest rates to increase these endeavors. Another important piece of the Japanese bubble was property values. Land holds a special place in the minds of Japanese people. Its ownership continued to convey status in a society not long released from feudal servitude, and development of land was relatively scarce when compared to a country like the US. There were also high capital gains taxes for short-term property gains, which encouraged owners to hold for the long term.

52:31Ironically, by discouraging the sale of land and creating an illiquid property market, the system actually encouraged land speculation. Between 1956 and 1986, land prices increased by 5 ,000 % while consumer prices only doubled. To help further fuel the bubble, banks acted on the belief that land prices would never fall again. So they provided loans against the collateral of the land rather than cash flows. Additionally, the banks knew that should things ever go badly, the government would likely be on the lookout to try and prevent a catastrophe from taking place. In the mid-1980s, the US and Japan had opposing economic policies.

53:14The US had relatively higher interest rates to keep inflation at bay, and Japan had a looser monetary policy. This led to a stronger dollar and weaker yen, which helped Japanese companies ship more products overseas. But in September 1985, the Plaza Accord was signed to correct the large trade imbalances globally. This led to a sharp appreciation of the Japanese yen, and now all of a sudden, Japanese goods in the international market were twice as expensive. Economic conditions in Japan then worsened, which led to the Bank of Japan lowering interest rates to help stimulate the economy, and then it just didn't take long for the market to just start roaring higher as the Nikkei Index reached 18 ,000 in the fall of 1986.

53:58Against the backdrop of a rising market, the government launched a long-awaited flotation of NTT, the national telephone company, offering 200 ,000 shares to the Japanese public. Within just two months, nearly 10 million people applied for shares, even though the government had yet to announce the issue price. Demand was so strong that the shares had to be distributed by a special lottery. The shares went live in February 1987, and within weeks, the share price had nearly tripled, valuing the company at over 200 times earnings. The market cap was around$375 billion US dollars, which in inflation-adjusted terms, would make it over a trillion-dollar company.

54:42One of the reasons that the stock traded at such elevated levels was because the government was behind the public offering, and it was widely believed that the government just wouldn't allow the share price to fall. In the public's eyes, betting on NTT was akin to betting on Japan itself, so the public embraced it without hesitation. Underneath the surface, Japanese politicians also had a vested interest in keeping the market going higher. Reaching the heights of the political sphere was expensive, as one needed to pay for favors and buy votes. It was estimated that the annual expense to maintain a major political position was around$3 million.

55:21This was partially funded for a lot of politicians by the stock market's gains. So instead of politicians helping keep speculation in check, they helped enable it. During the late 1980s, Japanese share prices would increase three times faster than corporate earnings, and the earnings themselves were inflated due to financial engineering. The Tokyo stock market flaunted some of the most overvalued shares in history. The textile sector traded at 103 times earnings. Services companies traded at 112 times earnings. And fishery and forestry firms traded at 319 times earnings. Western investors believed that such values were not justified and had reduced their stakes from the mid-1980s onwards.

56:07There were several explanations as to why such valuations were maybe justified. Some argued that accounting practices understated real earnings, and cross-shareholdings inflated reported PE measures. What also helped lift share prices was that interest rates were artificially low, and the rising yen discouraged investors from taking their money abroad. So they didn't have many alternatives, which led to a scarcity of sellers of Japanese stocks. It seemed that nothing could stop share prices from rising. When the emperor died in 1989, the market went up. When a small earthquake hit Tokyo six months later, prices continued to rise.

56:46Alongside the stock market, Japanese property prices climbed on an ever-increasing supply of credit, and as they climbed, many workers were being priced out of being able to buy a home, even a small apartment. Homebuyers were then forced to take out multi-generational 100-year mortgages. By 1990, the total Japanese property market was valued at over 2 ,000 trillion yen. This was over four times the real estate value of the entire United States. The grounds of the Imperial Palace in Tokyo was estimated to be worth more than the entire real estate value of California. Property values were simply beyond levels that would be considered unprecedented.

57:30Turning back to the government's role in helping fuel the bubble, the Ministry of Finance met with the four top brokers in the country and they ordered them to make a market for NTT shares and keep the Nikkei average above 21 ,000. The hope was that the broker's biggest clients would feel comfort knowing that share prices would not fall substantially, hopefully encouraging them to invest more. During the second half of the 1980s, 8 million new investors entered the market, taking the total number of Japanese investors to 22 million. New investors were encouraged by brokers to speculate in the market and were practically never handed a sell recommendation.

58:09Brokers took advantage of the Japanese population because they knew they tended to behave in herds and tend to not do what's unconventional. And they're prone to shifting mood swings, which can lead them to making emotional investing decisions. The four brokers, which accounted for more than half of the overall trading volume, worked together to determine which stocks should be pushed to customers. And for the major clients that needed tended to, or even needed losses recovered in short order, the brokers would be sure to make up for those at the expense of those who weren't insiders. The booming equity in property markets helped bring about a booming economy as well.

58:48Chancellor referred to it as the new golden age. People felt rich, so consumer spending was strong. The strong end helped stimulate demand for imports. Low income taxes gave consumers more disposable income. Loans were refinanced at low interest rates and consumer debt was hitting new highs. Since I've been getting more into golf lately in my personal life, not to say that I'm really any good, it was fun to read about the golf club membership craze of all things that was happening in Japan during this period. Golf was played by nearly a third of all salarymen, so it was really an important feature of the Japanese culture.

59:26The different ranks, accorded to clubhouses, allowed members to display their hierarchic status while businessmen, politicians, and bureaucrats used their time at the club to expand their network, which played an integral part of their social and professional life. Since golf clubs were owned by their members, when land prices soared in the 1980s, the property rights of a membership became increasingly attractive. In early 1982, the Nikkei Golf Membership Index was launched, and it was based on the average membership price at different clubs. Given how illiquid the property market was, the index served as a good indicator of the state of the market.

1:00:06From a base of 100, the index reached 160 at the end of 1985, and by the spring of 1990, it would reach over 1 ,000. The cost of joining Tokyo's leading country club was around$2.7 million, and over 20 clubs cost over$1 million to join. So not only was a golf club membership something to use for networking and showcasing your social status, but it in itself was also a speculative vehicle. Banks even provided margin loans of up to 90 % against the collateral of a membership certificate, which was of course used to invest more in the stock market. As the Japanese bubble was nearing its peak, it was starting to cause concern within some circles of society.

1:00:50One growing concern was the growing wealth inequality. The fortunes of the richest fifth of the population quadrupled, and the bottom fifth of society's wealth actually declined. The bubble was seen as eroding the work ethic by severing the connection between labor and reward. As 1989 drew to a close, the Nikkei Index was approaching 40 ,000, up 27 % on the year. The P-E ratio of the Nikkei was 80 times trailing earnings. The market yielded just 0.38 % in dividends and sold for six times book value. But in 1990, the governor of the Bank of Japan was replaced by a career central banker who boasted in public that he never owned a share in the market.

1:01:33He made it his personal mission to prick the bubble. He ordered for a raise in interest rates as the Nikkei reached its peak, and from there, the market started its descent. And the Bank of Japan went on to raise interest rates five more times to 6 % to try and bring down property prices. With a yield on long-term bonds of 7 % and a dividend yield well under 1 % for the stock market, there was just nothing left to keep valuations so high. Authorities did their best still to try and manage the decline. Margin requirements were lowered. Authorities ordered brokers to purchase stocks when the Nikkei fell below$20 ,000, and then margin requirements were lowered again.

1:02:18In the midst of the decline, frauds were uncovered and overly leveraged institutions went under as one domino after another fell. For example, one golf club was raided by police after having sold 60 ,000 memberships instead of the 2 ,000 they were authorized to sell. The dream that Tokyo would emerge as a global financial capital declined along with share prices and the Japanese economy headed towards a recession. Enormous capex during the good times saddled the country with excess productive capacity and falling asset values led to declining consumer confidence and spending. By late 1992, property prices had fallen by 60 % from their peak.

1:03:01Interest rates were then cut to try and undo the tremendous damage and would hit an all-time low of 0.5 % in 1995 and 0.25 % in 1998. But low interest rates failed to bring the market back to life. In 1989, the market peaked out around 39 ,000 and it wouldn't reach that level again until 2024. That's 35 years later. As Keynes observed during the Great Depression, in deflationary conditions, monetary policy was no more effective than pushing on a string. Falling property values led to a banking crisis as values of collateral fell and customers were in a hurry to pull their remaining cash out of banks.

1:03:43The environment in Japan rhymed of that with the Great Depression. Nine years into the collapse of the bubble, Japan teetered on the brink of systemic collapse as its banking system was weighed down with bad debts. The story of the Japanese bubble, along with the other bubbles outlined in the book, deliver several lessons that all of us could take away. Probably the most important one is the belief that the market risk or the downside can be eliminated, so infinite prices can be paid. Throughout the late 1980s, skeptics were told that the government would not allow share prices to fall and that the banks and brokerages were too big to fail.

1:04:21When the bubble collapsed a few years later, this deception was exposed. We saw a similar theme in the South Sea bubble when British shareholders believed that the government backing would protect them from losses. Most importantly, it's critical not to let your emotions overtake your decision-making when you find yourself caught in the bubble. When it feels like share prices can go nowhere but up, the market can feel more stable and durable than it actually is because we're anchored in the recent past. The Japanese bubble showcased that markets can detach from fundamentals for several years, and we shouldn't trick ourselves into thinking that this can continue forever.

1:04:59Another takeaway from studying bubbles from the past is the fraud and deception that takes place beneath the surface. Promoters often have financial incentives to further inflate the bubble and make things really look better than they are. It isn't until after the bubble has burst do you tend to see the fraud and deception exposed. And by then, it's too late to get out because the insiders realized before you did when it was the best time to do so. The final takeaway is that the bigger the bubble, the longer it can take for things to normalize. The Japanese bubble is a good example of how destructive a bubble can be if things get way too far out of hand.

1:05:38With many stocks trading at north of 100 times earnings, it creates a huge level of capital misallocation and leverage that took several years to clean up. While each bubble has its own story, each are driven by many of the same human traits such as greed, fear, overconfidence, and the belief that this time is different. Studying episodes like the South Sea Bubble, the railway mania, and Japan's 1989 collapse helps us recognize when speculation crosses the line so we can protect our hard-earned capital by staying grounded in fundamentals and disciplined when enthusiasm is at its loudest. So with that, thank you for tuning in to today's episode on Devil Take the Hindmost by Edward Chancellor.

1:06:23I really hope you enjoyed it, and I hope to see you again next week.

1:06:52a guarantee of future results. Listeners should do their own research and consult a qualified professional before making any financial decisions. Nothing on this show is a recommendation or solicitation to buy or sell any security or other financial product. Hosts, guests, and the Investor's Podcast Network may hold positions in securities discussed and may change those positions at any time without notice. References to any third-party products, services, or advertisers do not constitute endorsements, and the Investor's Podcast Network is not responsible for any claims made by them. Copyright by the Investor's Podcast Network.

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