Confusion of Confusions (Joseph de la Vega)

Trader's Library #9 · Speculation classics and biographies. Proof that the 17th-century market behaved just like today's.

Author: Joseph de la Vega · Original: Confusión de confusiones · Year: 1688 · Usefulness for traders: ★★★☆☆

What it's about

The oldest known book about the stock exchange, written as dialogues between a philosopher, a merchant and a shareholder. It describes trading in East India Company shares on the 17th-century Amsterdam exchange, including forward contracts and options.

What it gives a trader

More than 330 years ago de la Vega described phenomena a trader sees on screen today: panic and euphoria, rumours, manipulation, short selling, derivatives and the fact that price moves often have no rational explanation. A great lesson in humility: technology changes, people don't.

Lessons for traders

• crowd psychology in the market has been unchanged for centuries (herding, Atlas of biases #31)
• derivatives and short selling aren't 20th-century inventions
• don't give advice or take it when the market is going crazy

What to watch out for

A baroque, florid style with lots of digressions. The value is more historical and philosophical than practical.

Discussion

The discussion takes place in Hetman Capital Club (in Polish). Join the discussion in the Club →

Navigation

← #008 The Man Who Solved the Market (Gregory Zuckerman) · Library index · #010 The Art of Speculation (Philip L. Carret) →

Educational content, not investment advice. The book description is my own summary and assessment, not quotations. Edition details were checked in catalogues and bookshops, and where there was doubt I said so plainly.