The Long Term Investor
Financial History’s Biggest Lessons and How Past Crashes Can Guide Your Investing with Mark Higgins (EP.204)
May 14, 2025
Mark Higgins, author of "Investing in U.S. Financial History", shares insights into how understanding historical market crashes can give investors an edge. He discusses the surprising parallels between past crises and today's economic climate. Higgins emphasizes the importance of investor psychology and warns against emotional decision-making. He explores how politics and inflation have shaped market behaviors historically. With pragmatic lessons drawn from financial history, he guides listeners on building resilient long-term portfolios.
30:25
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Quick takeaways
- Understanding historical market crashes offers insights into investor psychology and the importance of a resilient portfolio strategy for long-term success.
- Recognizing the dangers of herd behavior can prevent rash investment decisions that lead to significant financial losses during economic peaks.
Deep dives
The Importance of Studying Financial History
Studying financial history, particularly that of the United States, is essential for investors as it reveals patterns of human behavior that tend to repeat over time, particularly in market crises. The U.S. has experienced numerous economic cycles, and the lessons learned from past mistakes can help investors avoid similar pitfalls. For example, understanding historical market crashes, like the Great Depression, can provide insights into investor psychology and the need for a resilient portfolio strategy. Ignoring these lessons and relying solely on personal experience can lead individuals to repeat the financial errors of those who came before them.
