Skip to main content

Mobs, Messiahs, and Markets

Think for yourself and act accordingly.

If I were to sum up the ideas and underlying theme of Bill Bonner and Lila Rajiva's book, Mobs, Messiahs, and Markets, in a single sentence, that would be it.

It's a seemingly simple and succint philosophy, but executing this principle is where the difficulty lies. Because we are subject to the influence and demands of experts and leaders, along with the groupthink of crowds, our ability to reason and stand alone in a state of independence is constantly compromised. At one time or another, we are all subject to the pull of the crowd.

This is the idea that authors Bonner and Rajiva develop, or rather, expound on during the length of this book. This is not a new idea; many readers are likely to recall similar lessons on the dangers of groupthink and crowd behavior, as recorded in Charles Mackay's, Extraordinary Popular Delusions and The Madness of Crowds. What the authors of Markets do is update those lessons and apply them when chronicling some of the widely held delusions and popular manias of our time.

The book rolls along in a kind of acerbic, H.L. Mencken-style prose, with the authors addressing topics ranging from politics and finance, to mass hysteria over media-fueled scandals and events. Their tone is damning as they point out the hypocrisy among both the political left and the right, and in the motivations of the ever-burgeoning crowd of professional do-gooders and "world-improvers".

All this criticism (and more) is richly deserved, and the opening chapters on the methods and stated ideals of the "global agenda" set are a personal favorite. Rajiva and Bonner later build on these opening thoughts, and frequently refer back to them as the similarity between the seemingly disparate fields of politics and finance becomes more apparent. And the bridge that joins these seperate worlds is the idea of the public spectacle, and the effect that it has on our thoughts, emotions, and personal drives.

It seems that many of our actions and ideas are spurred on not by a careful consideration of things we know or are qualified to learn more about, but by simply reducing things we cannot fully understand down to manageable concepts and ideas. Slogans, if you will.


Here are a few examples of the simplified reasoning which lies behind many of our popularly held notions: "Stocks for the long run", "real estate prices never go down", "deficits don't matter", "you are either with us or against us", and so on.

When we get wrapped up in a belief set, or the excitement and consensus-building push of some powerful agenda, these factors and slogans can influence our thoughts and opinions, and shape our actions and decisions. Whether you are deciding to purchase stocks for your retirement fund, or reviewing arguments of a political nature, the selection process and your motivation to act is often influenced by factors of simplification and shared belief.

The crowd, and the crowd manipulator, seeks to reduce its message to the most popularly acceptable form, the lowest common denominator. The individual gives in to crowd mentality or the proclamations of experts and politicians when confronted with too much information and not enough time or reasoning ability to fully comprehend their message, its meaning, and its after-effects.

In time, the widely-held beliefs and slogans can drive a public spectacle, and all the reckless behavior that accompanies it. This holds true for politics, business, the world of finance and investments, and almost any area of human interaction and endeavor.


As the authors point out, the crowd is something that takes over in our minds and grabs hold of our passions. It exists within us, just as it coalesces outside into a raging mob. Learning to recognize the dangers of crowd thinking and behavior, as opposed to constructive voluntary group behavior, is essential to navigating a more successful course in our investments and our daily life.

If you are willing to reflect on this message, and are able to withstand the skewering of many of our society's deeply-held values and "truths", then you may enjoy this book.

Popular posts from this blog

The Dot-Com Bubble in 1 Chart: InfoSpace

With all the recent talk of a new bubble in the making, thanks in part to the Yellen Fed's continued easy money stance, I thought it'd be instructive to revisit our previous stock market bubble - in one quick chart.

So here's what a real stock market bubble looks like. 

Here's what a bubble *really* looks like. InfoSpace in 1999-2001. $QQQ$BCORpic.twitter.com/xjsMk433H7
— David Shvartsman (@FinanceTrends) February 24, 2015
For those of you who are a little too young to recall it, this is a chart of InfoSpace at the height of the Nasdaq dot-com bubble in 1999-2001. This fallen angel soared to fantastic heights only to plummet back down to earth as the bubble, and InfoSpace's shady business plan, turned to rubble.

As detailed in our post, "Round trip stocks: Momentum booms and busts", InfoSpace rocketed from under $100 a share to over $1,300 a share in less than six months. 

In a pattern common to many parabolic shooting stars, the stock soon peaked and began a…

New! Finance Trends now at FinanceTrendsLetter.com

Update for our readers: Finance Trends has a new URL! 

Please bookmark our new web address at Financetrendsletter.com

Readers sticking with RSS updates should point your feed readers to our new Finance Trends feedburner.  



Thank you to all of our loyal readers who have been with us since the early days. Exciting stuff to come in the weeks ahead!

As a quick reminder, you can subscribe to our free email list to receive the Finance Trends Newsletter. You'll receive email updates about once every 4-8 weeks (about 2-3 times per quarter). 

Stay up to date with our real-time insights and updates on Twitter.

William O'Neil Interview: How to Buy Winning Stocks

Investor's Business Daily founder and veteran stock trader, William O'Neil shared his trading methods and insights on buying winning stocks in an in-depth IBD radio interview.

Here are some highlights from William O'Neil's interview withIBD:

William O'Neil's interest in the stock market began when he started working as a young adult. 

"I say many times that I didn't get that much out of college. I didn't have much interest in the stock market until I graduated from college. When I got married, I had to look out into the future and get more serious. The investment world had some appeal and that's when I started studying it. I became a stock broker after I got out of the Air Force."
He moved to Los Angeles and started work in a stock broker's office with twenty other guys. When their phone leads from ads didn't pan out, O'Neil would take the leads and drive down to visit the prospective customers in person.

"I'd get in the c…