We Study Billionaires - The Investor’s Podcast Network TIP427: The History of Bubbles, Mania & Fraud w/ Jamie Catherwood
23 snips
Mar 4, 2022 Jamie Catherwood, a financial market historian and founder of Investor Amnesia, joins to explore the fascinating world of market bubbles and fraud. He delves into historical instances like Tulipmania, revealing insights that challenge common myths. Jamie discusses modern micro manias and vital lessons from the 1800s that apply to today's tech stock concerns. The conversation also highlights the conditions that foster fraud and how speculation can benefit investors, all while tracing the lineage of financial instruments back to the 10th century.
AI Snips
Chapters
Books
Transcript
Episode notes
Tulip Mania: A Misnomer?
- Tulip Mania, often cited as a bubble example, might be exaggerated.
- Satirical pamphlets, not factual accounts, fueled the narrative of widespread financial ruin.
Bubble Triangle Framework
- The “bubble triangle” framework helps explain bubble formation: speculation (heat), marketability (oxygen), money/credit (fuel).
- A spark, usually tech or government policy, ignites the bubble when all three sides are present.
Nikola: A Mini-Mania Case Study
- Nikola’s rapid rise and fall exemplifies modern mini-manias, fueled by hype around electric vehicles and Tesla’s success.
- Investors, eager to catch the “next Tesla,” ignored Nikola's lack of product and sales.
