• Novel Market Inefficiencies from Early Victorian Times
    • ‘A previously unknown pricing anomaly existed for a few years in the late 1840s in the British government bond market, in which the larger and more liquid of two very large bonds was under-priced. None of the published mechanisms explains this phenomenon. It may be related to another pricing anomaly that existed for much of the 19th century in which terminable annuities were significantly underpriced relative to so-called ‘perpetual’ annuities that dominated the government bond market. The reasons for these mispricings seem to lie in the early Victorian culture, since the basic economic incentives as well as laws and institutions were essentially the familiar modern ones. This provides new perspectives on the origins and nature of modern corporate capitalism.’
  • For Tech Giants, A Cautionary Tale from 19th Century Railroads on the Limits of Competition
    • ‘That may sound familiar. As a historian of that first Gilded Age, I see parallels between the power of the railroads and today’s internet giants like Verizon and Comcast. The current regulators – the Federal Communications Commission’s Republican majority – and many of its critics both embrace a solution that 19th-century Americans tried and dismissed: market competition.’
  • Great Swindles of the 19th Century
    • ‘The 19th century was marked by a number of notorious swindles, including one involving a fictitious country, one connected to the transcontinental railroad, and a number of bank and stock market frauds.’
  • 200 Years of Asset Allocation
    • ‘From the perspective of even the most seasoned investment professional, a series of unprecedented events has occured over the last 40 years. Interest rates have been in almost constant decline. A global financial crisis forced both governments and central banks to step in to support financial markets. The fall in bond yields has led investors to shift into evermore exotic alternative assets.However, a 200-year view of our industry provides a very different perspective. Many of the challenges we face today have been faced by investors of previous generations. Interest rates were on a downward path for almost the entire 19th century. As now, pension fund and insurance company investors responded by shifting from government bonds to less liquid alternatives.’
  • The Darien Disaster: A Financial Scandal
    • ‘At the end of the 17th century, Panama became the focal point of Scottish imperial ambitions in a venture often described as the “Darien Scheme”. The failure of Darien was so catastrophic that it remains one of the greatest calamities in Scottish history. Its consequences have long been debated by historians, although none can doubt that it cost Scotland dearly. Some even see it as a decisive factor in compelling the Scottish parliament, along with the scheme’s bankrupted investors, to enter into union with England in 1707.’

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