Contrarian Speculation: Crowded Markets in Fiction and Vernacular Finance

Research output: Contribution to conferencePaperResearchpeer-review

Abstract

This article examines the efforts made in early 20th century novels and investment handbooks to describe allegedly irrational behavior in financial markets, via the employment of late 19th century crowd psychology and the vocabulary that grew out of this theoretical tradition. Crowd psychology provided authors of investment handbooks with a suitable vocabulary and with adequate explanations for the excessive fluctuations in a both crises-ridden and mania-prone American stock market. In doing so, it also provided legitimacy to contrarian investment strategies that encouraged speculators to take into account the seemingly irrational behavior of the market crowd. This article’s focal point is the ‘Vermont Ruminator’ Humphrey B. Neill’s conceptualization of ‘The Theory of Contrary Opinion’, a market theory preconditioning the existence of a market crowd as an inherent part of financial markets’ functioning. The article demonstrates how a highly polemic and manifesto-like theorization of a particular investment practice was informed by a popular conception of ‘the market’, directly traceable to literary representations of markets and vernacular finance. Inspired by Michel Foucault’s analytic notion of ‘problematization’, the article analysis and examines Neill’s contrarian speculation philosophy as a certain field of experience offering an answer to a concrete problem concerning seemingly irrational behavior and inexplicable fluctuations in financial markets. The aim of the article is to understand how ideas and vocabulary from crowd theory was mobilized by Neill and kindred contemporaries for investment-strategic purposes and how this mobilization refers to as well as enacts or creates a particular conception of ‘the market’.
Original languageEnglish
Publication date2014
Number of pages24
Publication statusPublished - 2014
EventThe 3rd Interdisciplinary Market Studies Workshop - Couvent Royal, Saint-Maximin-la-Sainte-Baume, France
Duration: 5 Jun 20146 Jun 2014
Conference number: 3
http://imsw2014.sciencesconf.org/

Workshop

WorkshopThe 3rd Interdisciplinary Market Studies Workshop
Number3
LocationCouvent Royal
CountryFrance
CitySaint-Maximin-la-Sainte-Baume
Period05/06/201406/06/2014
Internet address

Cite this

Bondo Hansen, K. (2014). Contrarian Speculation: Crowded Markets in Fiction and Vernacular Finance. Paper presented at The 3rd Interdisciplinary Market Studies Workshop, Saint-Maximin-la-Sainte-Baume, France.
Bondo Hansen, Kristian. / Contrarian Speculation : Crowded Markets in Fiction and Vernacular Finance. Paper presented at The 3rd Interdisciplinary Market Studies Workshop, Saint-Maximin-la-Sainte-Baume, France.24 p.
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abstract = "This article examines the efforts made in early 20th century novels and investment handbooks to describe allegedly irrational behavior in financial markets, via the employment of late 19th century crowd psychology and the vocabulary that grew out of this theoretical tradition. Crowd psychology provided authors of investment handbooks with a suitable vocabulary and with adequate explanations for the excessive fluctuations in a both crises-ridden and mania-prone American stock market. In doing so, it also provided legitimacy to contrarian investment strategies that encouraged speculators to take into account the seemingly irrational behavior of the market crowd. This article’s focal point is the ‘Vermont Ruminator’ Humphrey B. Neill’s conceptualization of ‘The Theory of Contrary Opinion’, a market theory preconditioning the existence of a market crowd as an inherent part of financial markets’ functioning. The article demonstrates how a highly polemic and manifesto-like theorization of a particular investment practice was informed by a popular conception of ‘the market’, directly traceable to literary representations of markets and vernacular finance. Inspired by Michel Foucault’s analytic notion of ‘problematization’, the article analysis and examines Neill’s contrarian speculation philosophy as a certain field of experience offering an answer to a concrete problem concerning seemingly irrational behavior and inexplicable fluctuations in financial markets. The aim of the article is to understand how ideas and vocabulary from crowd theory was mobilized by Neill and kindred contemporaries for investment-strategic purposes and how this mobilization refers to as well as enacts or creates a particular conception of ‘the market’.",
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Bondo Hansen, K 2014, 'Contrarian Speculation: Crowded Markets in Fiction and Vernacular Finance' Paper presented at, Saint-Maximin-la-Sainte-Baume, France, 05/06/2014 - 06/06/2014, .

Contrarian Speculation : Crowded Markets in Fiction and Vernacular Finance. / Bondo Hansen, Kristian.

2014. Paper presented at The 3rd Interdisciplinary Market Studies Workshop, Saint-Maximin-la-Sainte-Baume, France.

Research output: Contribution to conferencePaperResearchpeer-review

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PY - 2014

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AB - This article examines the efforts made in early 20th century novels and investment handbooks to describe allegedly irrational behavior in financial markets, via the employment of late 19th century crowd psychology and the vocabulary that grew out of this theoretical tradition. Crowd psychology provided authors of investment handbooks with a suitable vocabulary and with adequate explanations for the excessive fluctuations in a both crises-ridden and mania-prone American stock market. In doing so, it also provided legitimacy to contrarian investment strategies that encouraged speculators to take into account the seemingly irrational behavior of the market crowd. This article’s focal point is the ‘Vermont Ruminator’ Humphrey B. Neill’s conceptualization of ‘The Theory of Contrary Opinion’, a market theory preconditioning the existence of a market crowd as an inherent part of financial markets’ functioning. The article demonstrates how a highly polemic and manifesto-like theorization of a particular investment practice was informed by a popular conception of ‘the market’, directly traceable to literary representations of markets and vernacular finance. Inspired by Michel Foucault’s analytic notion of ‘problematization’, the article analysis and examines Neill’s contrarian speculation philosophy as a certain field of experience offering an answer to a concrete problem concerning seemingly irrational behavior and inexplicable fluctuations in financial markets. The aim of the article is to understand how ideas and vocabulary from crowd theory was mobilized by Neill and kindred contemporaries for investment-strategic purposes and how this mobilization refers to as well as enacts or creates a particular conception of ‘the market’.

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Bondo Hansen K. Contrarian Speculation: Crowded Markets in Fiction and Vernacular Finance. 2014. Paper presented at The 3rd Interdisciplinary Market Studies Workshop, Saint-Maximin-la-Sainte-Baume, France.