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The Myth of the Rational Market: A History of Risk, Reward, and Delusion on Wall Street Audiobook
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(3.02) - 568 listener ratings
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Publisher Description
“Do we really need yet another book about the financial crisis? Yes, we do—because this one is different….A must-read for anyone who wants to understand the mess we’re in.” —Paul Krugman, New York Times Book Review
“Fox makes business history thrilling.” —St. Louis Post-Dispatch
A lively history of ideas, The Myth of the Rational Market by former Time Magazine economics columnist Justin Fox, describes with insight and wit the rise and fall of the world’s most influential investing idea: the efficient markets theory. Both a New York Times bestseller and Notable Book of the Year—longlisted for the Financial Times Business Book of the Year Award and named one of Library Journal Best Business Books of the Year—The Myth of the Rational Market carries readers from the earliest days of Wall Street to the current financial crisis, debunking the long-held myth that the stock market is always right in the process while intelligently exploring the replacement theory of behavioral economics.
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"A very readable narrative of economic history through the last 120 years or so. The author clearly enjoys the intellectual battle of economic ideas between the quantitative efficient marketers of the Chicago school and the behaviorists who are more skeptical of any dubious claims of "the market is always right" crowd. Great spirited debate between the great finance intellectuals and Nobel laureates described here. I was left with the sneaking suspicion that a lot of brainpower has been wasted in Finance rather than in genuine wealth-creating and society-improving activities! Finance should perhaps be the (overhead) grease that oils society rather than an end in itself? Anyway, great book with exhaustive research - read it."
— Ram (4 out of 5 stars)
Quotes
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“Do we really need yet another book about the financial crisis? Yes, we do—because this one is different. Fox’s book is not an idle exercise in intellectual history, which makes it a must-read for anyone who wants to understand the mess we’re in.”
— Paul Krugman -
“A fascinating historical narrative.”
— Washington Post -
“His analysis is singularly compelling, and the rare business history that reads like a thriller…A must-read for anyone interested in the markets, our economy or government, this dense but spellbinding work brings modern finance and economics to life.”
— Publishers Weekly -
“Justin Fox is a truly insightful fellow who can see things with his own eyes—a rare, very rare attribute.”
— Nassim Nicholas Taleb, author of The Black Swan -
“This wise and witty book is must reading for anyone who wonders what makes financial markets tick. Even those who have wrestled with this question for years will be glad to have read Fox’s compelling history.”
— Peter Bernstein, author of Against the Gods: The Remarkable Story of Risk -
“A lucid, lively and learned account.”
— Barron’s -
“Fox makes business history thrilling.”
— St. Louis Post-Dispatch -
“Impressively broad and richly researched.”
— Financial Times -
“An intellectual tour-de-force.”
— The Economist -
“A rich history of the world’s most seductive investing idea...the book chronicles the rise of rational market theory over the decades and captures the sizzle and pop of the intellectual debate.”
— Bloomberg
Awards
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A New York Times bestseller
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Longlisted for the 2009 Financial Times Best Book of the Year
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One of the 2009 New York Times Book Review 100 Notable Books for Nonfiction
The Myth of the Rational Market Listener Reviews
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" Informative, peopled with lots of characters, but the pacing was very slow sometimes....too slow. "
— Izzy, 2/20/2014 -
" Too much history for my tastes, though I'm not exactly sure what I mean by that. Lots of names and their arguments. I admit it forms a type of dialogue that is probably neatly formed but after enough positions were superseded, invalidated, or reforged into newer versions, I just wanted to hurry up and get to the current ones. "
— Josiah, 2/12/2014 -
" Great book! Really dispels the "efficiency" of the markets. "
— David, 1/27/2014 -
" To be appreciated most by financial planners, economists, stock market analysts and all others involved with investment theory and managing other people's money. Discusses the rise of the Capital Asset Pricing Model, Modern Portfolio Theory and its companion the Efficient Market Hypothesis which influenced portfolio management for decades, and how academic research and events have overthrown those belief systems. Other issues discussed include the rise of portfolio insurance, options and derivatives, and the mortgage bubble. What it lacks is a discussion of how the overthrow of the Efficient Market has undermined basic assumptions in the Financial Planning world (e.g. The Efficient Frontier used in portfolio allocation), and what that means for those seeking guidance on how to build their financial future, especially a financially secure retirement. "
— Ralph, 1/23/2014 -
" A relatively fast paced and informing review of the academic approach to the markets over time. Worth the time "
— Nathan, 1/23/2014 -
" I found this book to be a serious primer on macroeconomic -- something that I could take notes on, refer back to, etc. An interesting read for an overview of what could be a dry subject. Feel I learned 2 years worth of econ research with this book, although I had to take a lot of notes and supplement my understanding by looking up details and overview of ideas and people on the internet. But Justin Fox is extremely readable and insightful. "
— Mary, 1/14/2014 -
" This is a synopsis of the history of financial history, mostly the failed idea that prices of securities are rational, how those ideas became politicized and then ffailed. Not a pretty nor entertaining tale as told. As my daughter, Jessica likes to say, you can do better. "
— Joseph, 1/9/2014 -
" Not really what I was looking for. This is more a history than anything. "
— Julie, 12/29/2013 -
" Fox takes an axe to the UChicago Rational Market theories. He does a thorough job of chronicling the history of the theory, its application, and the disaster that unfolded in its application. "
— Don, 11/13/2013 -
" Four stars if you're into this sort of thing...the economics/finance nerd in me really enjoyed it. "
— Comfortkits, 10/20/2013 -
" Great. Very narrative and readable, and covers the whole arc of the story. Mandatory reading for anyone who wonders why some modern economists seem to have no idea what they're talking about. "
— Ketsugami, 7/14/2013 -
" Interesting read. Hard to keep all the people straight, but over all pretty good. "
— Aposprout, 6/2/2013 -
" Wildly boring history lesson with an endless stream of names for the first half. Got much more interesting after the half-way point. "
— Ryan, 5/15/2012 -
" Great 100+ year review/synopsis/report on what we call economics and finance. Great read for anyone interested in anything that happens in the world. Period. Ever. Well, at least anything tied to domestic economics. Enjoy! "
— Timmy, 12/30/2011 -
" Fascinating history of modern finance. How we moved from markets being really novel to markets knowing more than we know and always being right to where we are today. Easy to read even for those who know little about finance. I would highly recommend it. "
— Efox, 5/10/2011 -
" Comprehensive history of finance, theory as well as (Wall Street) practice. "
— Deep, 4/29/2011 -
" The author is now the editor of the Harvard Business Review. Fascinating history (much of it very recent)of the debate over the extent to which the free market correctly assesses risk and prices assets. I think it has a bad title. The topic is presented in a balanced manner. Almost gave it 5 stars. "
— Thomas, 4/4/2011 -
" Comprehensive history of finance, theory as well as (Wall Street) practice. "
— Deep, 4/2/2011 -
" This is a synopsis of the history of financial history, mostly the failed idea that prices of securities are rational, how those ideas became politicized and then ffailed. Not a pretty nor entertaining tale as told. As my daughter, Jessica likes to say, you can do better. "
— Joseph, 3/14/2011 -
" Interesting read. Hard to keep all the people straight, but over all pretty good. "
— Aposprout, 1/22/2011 -
" A relatively fast paced and informing review of the academic approach to the markets over time. Worth the time "
— Nathan, 6/29/2010 -
" Well written, but all about econometrics - found myself snoozing through the things I could learn. Not really worth the whole read but I enjoyed the 1/3 I got though. "
— Liz, 4/2/2010 -
" Great 100+ year review/synopsis/report on what we call economics and finance. Great read for anyone interested in anything that happens in the world. Period. Ever. Well, at least anything tied to domestic economics. Enjoy! "
— Timmy, 1/19/2010 -
" Four stars if you're into this sort of thing...the economics/finance nerd in me really enjoyed it. "
— Comfortkits, 1/18/2010
About Justin Fox
Justin Fox is the editorial director of the Harvard Business Review Group. He is also a contributing writer at Time, where until 2010 he was the economics columnist and creator and lead writer of the Curious Capitalist blog. Before joining Time in 2007, Fox spent more than a decade at Fortune magazine, where he covered a wide variety of topics related to economics, finance, and international business. Prior to joining Fortune, Justin Fox worked at several newspapers, including American Banker and The Birmingham (Alabama) News. He has a degree in international affairs from Princeton University, studied political science at the University of Leiden in the Netherlands, and speaks Dutch and German. Fox is married and has a son. He lives in Cambridge, Mass.
About Alan Sklar
Alan Sklar, a graduate of Dartmouth, has excelled in his career as a freelance voice actor. Named a Best Voice of 2009 by AudioFile magazine, his work has earned him several Earphones Awards, a Booklist Editors’ Choice Award (twice), a Publishers Weekly Listen-Up Award, and Audiobook of the Year by ForeWord magazine. He has also narrated thousands of corporate videos for clients such as NASA, Sikorsky Aircraft, IBM, Dannon, Pfizer, AT&T, and SONY.