RIP ‘Adam Smith’
Jason Zweig recently remembered the late financial writer Jerry Goodman, who used the pseudonym Adam Smith. Among other titles and pieces, Goodman was the author of The Money Game.
In The Money Game, the best-selling book he published in 1968, Goodman exposed the frenzied trading, epidemic rumor-mongering and bizarrely neurotic behavior that drove many professional money managers throughout what came to be called the “go-go” years of the bull market of the late 1960s. With a panache no financial writer ever since could hope to match, he cited the mumbo-jumbo of Freudian psychologists, quoted philosophers and poets in untransliterated ancient Greek, and ridiculed Wall Street analysts trying to make sense of momentum stocks with mock names like Murgatroyd Bonbon and Digital Datawhack.
Excerpt from The Money Game (1968 edition, p. 81):
A stock is, for all practical purposes, a piece of paper that sits in a bank vault. Most likely you will never see it. It may or may not have an Intrinsic Value; what it is worth on any given day depends on the confluence of buyers and sellers that day. most important thing to realize is simplistic: The stock doesn’t know you own it. All those marvelous things, or those terrible things, that you feel about a stock, or a list of stocks, or an amount of money represented by a list of stocks, all of these things are unreciprocated by the stock or the group of stocks. You can be in love if you want to, but that piece of paper doesn’t love you, and unreciprocated love can turn into masochism, narcissism, or, even worse, market losses and unreciprocated hate.