Moira+I haven’t got a brilliant track record when it comes to investing money. Examples include opting for an endowment mortgage and putting what little money we had into Equitable Life (some readers may be too young to appreciate the significance of these decisions!). I’ve previously expressed fears about the lack of finance for our old age and was fascinated to hear comments made by the eminent economist J K Galbraith in 1955 about the Wall Street Crash of 1929 on the "World Service" overnight (yes, sad man that I am!). I can’t find the precise quotation, but the following gives the flavour:
“The purpose is to accommodate the speculator and facilitate speculation. But the purposes cannot be admitted. If Wall Street confessed this purpose, many thousands of moral men and women would have no choice but to condemn it for nurturing an evil thing and call for reform. Margin trading must be defended not on the grounds that it efficiently and ingeniously assists the speculator, but that is encourages the extra trading which changes a thin and anaemic market into a thick and healthy one. Wall Street, in these matters, is like a lovely and accomplished woman who must wear black cotton stockings, heavy woollen underwear, and parade her knowledge as a cook because, unhappily, her supreme accomplishment is as a harlot."
Although written over fifty years ago, it absolutely describes the present financial mess. I fear that we still have a very long way to go in overcoming our current plight. Another quote from JK:
“The purpose is to accommodate the speculator and facilitate speculation. But the purposes cannot be admitted. If Wall Street confessed this purpose, many thousands of moral men and women would have no choice but to condemn it for nurturing an evil thing and call for reform. Margin trading must be defended not on the grounds that it efficiently and ingeniously assists the speculator, but that is encourages the extra trading which changes a thin and anaemic market into a thick and healthy one. Wall Street, in these matters, is like a lovely and accomplished woman who must wear black cotton stockings, heavy woollen underwear, and parade her knowledge as a cook because, unhappily, her supreme accomplishment is as a harlot."
Although written over fifty years ago, it absolutely describes the present financial mess. I fear that we still have a very long way to go in overcoming our current plight. Another quote from JK:
“A common feature of all these earlier troubles was that, having happened, they were over. The worst was reasonably recognizable as such. The singular feature of the great crash of 1929 was that the worst continued to worsen. What looked one day like the end proved on the next day to have been only the beginning”.
… and a very happy Friday to you all (sorry)!
… and a very happy Friday to you all (sorry)!
Photo: John Kenneth Galbraith (1908-2006)
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