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JWPR031-Bonner-SampleJuly 18, 200722:35INDEXLAsness, Clifford, 313Asset-price boom, 285Assets, 259–260United States in foreign hands, 295value of all world’s financial, 284Assets-to-equity ratio, 307–308Astrology, 48Asunción, Paraguay, 347Atrocities, 108–110Auckland, Lord, 209–210Automotive industry, 222oDok Msh Aop T.co ERm IAAbuse, child, 89–95Adjustable-rate mortgages (ARMs),272Afghanistan, 52, 133, 210–212Africa, 160, 240Alexander the Great, 7–9Algeria, 70–71Ali, Muhammad, 378Allawi, Ayad, 137Altruism, 41–42Amaranth Advisors, 303, 306Amazon.com, 250Americansconsumer attitudes, 322and debt, 133delusions of grandeur, 53–54desire for responsible government,346–347faith in military, 143purchasing power, 285Annual rate of return, 351Anti-Charitable Contributions Act,208–209Apple Computer, 315AQR Capital Management, 313Aravind eye hospital, 241–242Argentina, 160–166, 170, 339,352–353ARMs (Adjustable-rate mortgages),272Art and artists, 34–39Arzuaga, Javier, 158Asia, 120, 265Asian Region of the Future 2005/06,218COPYhttp:RI//wGwHwT.pEbBaghdad, 136–138Bank for International Settlements,307Bankruptcy, 317Barclays Capital, 284Bartholomew, James, 65–67Basic Inc. v. Levinson, 340Batista government, 153, 156, 158Bear market, 344, 351Beef, 228–229Belgium, 107–110Beliefs, religious, 376–377Bell curve, 230–231Ben-Brahim, Driss, 284Bentham, Jeremy, 191Bernanke, Ben, 274Betancourt, Ernesto, 158Bhagwati, Jagdish, 228–229Black Death, 87Black Swans, 231Blackshirts, 5Blankfein, Lloyd, 284Blitz, 123–126413
JWPR031-Bonner-Sample22:35INDEXhttp://wwwCACI International Inc., 141Capitalism, 197, 389Carry trade, 249Cartesian reason, 372–373shop.comCash, 361–362Castro, Fidel, 140, 153Central Bank of Cuba, 159Central banking, 280–295and Alan Greenspan, 295in China, 179control of currency, 254, 292in Cuba, 153purpose of, 292–293CEOs, 30–33, 284–285, 315Chalabi, Ahmad, 104Chang, Jung, 173Chaos, 371Chavez, Hugo, 307Chennai, 217–223Chiang Kai-shek, 175–176, 179Child abuse, 89–95Children, 96, 98–99China, 173–182, 199, 353Chirac, Jacques, 11–12Chou En-lai, 178CIA, 104–105, 138–142Clive, Robert, 208Coca-Cola, 217Cockburn, Alexander, 91–92, 93–94Cockburn, Patrick, 144Cohen, Steven, 316Cohn, Norman, 80Coins, 256–257, 363Collectives, 366Collectivism, 126Colonies, British, 114–115Command economy, 371Commentary, market, 324Commerce, 133, 197, 219–223Commodities, 344Commodity fetishism, 374Commodity prices, 169Common decency, 70Communism, 126, 157–158, 176Comparative advantage theory, 203Confidence, 30–31, 39ok.pBolivia, 156, 160Bombings, 22, 123–126Bonuses, executive, 31, 284–285,389Bourne, Randolph, 80Brainwashing, 105Branch Davidians, 95Braverman, Steven, 313Brazil, 25–26Brin, Sergey, 315Britaincolonial subjects, 114–115and Germany, 120and globalization, 207and Iraq, 144propaganda, 105–107, 109–110in the 1970s, 65–66trade and fraud in the Empire,207–212Brooks, David, 9–10Bryce, James, 109Buffett, Warren, 191, 305, 329, 357,360Bull market, 266–279, 344, 350, 351Bush, George W., 8–10and federal debt, 264, 294and full spectrum dominance,146and gold prices, 352and Middle East, 154number of votes, 193and suicidal statecraft, 144vision of good and evil, 147and war in Iraq, 52, 136–138and word games, 64–67Businesses, 348, 357–358Butterfly effect, 325bo414July 18, 2007
JWPR031-Bonner-SampleJuly 18, 200722:35Indexokshop.comhousehold, 258, 263, 294, 316–317of older Americans, 316–317Deception, 45–46, 136, 365Defense companies, 32, 33Deficit, trade. See Trade deficitDelusions of grandeur, 53–54Democracy, 65, 66, 154, 368Derivatives, 296–317. See also HedgefundsDeveloping countries, 225Dewar, Mike, 115Digby, W. R., 208Dijksterhuis, Ap, 68Disorder and Early Sorrow, 285Dissent, 61Distribution, normal, 230Divorce, 25Dodgson, Charles, 206Dollarand Argentine economy, 162backed by gold, 281, 282fall versus rise of gold, 362and inflation, 292linked to peso, 166Dot-com investors, 252Dow Jones Industrial Average,247–248, 249Dubner, Stephen, 187Dunbar, Robin, 186http://www.pboConspicuous consumption, 28Conspiracy, diabolical, 88–89Constant Proportion Debt Obligation(CPDO), 301Consumer attitudes, 322Consumer credit, 245, 263, 349Consumer debt, 294Consumer prices, 262Cooperation, 366, 367Coromandel Coast, 216, 218Corruption, 166Cowperthwaite, John, 65CPDO (Constant Proportion DebtObligation), 301Cramer, Jim, 251Credit, 245, 263, 349and Alan Greenspan, 250, 253growth in, 1947–2007, 260Japanese, 251short-term, 280CreditAnstalt, 325Crowds, 143, 188, 364–368. See alsoGroupsCrusades, 16–20Crusades from the Arab Point of View,The, 17–20Cuba, 153–154Cults, 95–97Cultural Revolution, 181Currency, 254, 256–257, 282Customs, 373David, George, 32–33De Vlieghere, Martin, 215Debt, 131, 262–263, 281and Americans, 133Argentina, 163–164consumer, 294and derivatives, 297government, 264, 294and Greenspan, 251home-mortgage, 294415Ebbers, Bernie, 299–300Economic Freedom Index, 218Economic growth, 66Economic man, 189Edwards, Edwin, 300Efficient Market Hypothesis, 149,340–34180–20 rule, 231Electionsof 2006, 146effect of individual voters, 58how much is spent, 187
JWPR031-Bonner-Sample22:35INDEXshop.comFederal Reserve, 280, 286–295Fighting forces, 135Fiorina, Carly, 31Fixed-action pattern, 88Flat Earth Society, 197–215Food aid, 239Food production, 238–239, 353Foodstuffs, 344Ford Motor Company, 307Foreclosures, 278Foreign aid, 240. See also World BankFox, M. W., 87France, 70–71, 119Franco-Prussian War, 150Frauds, 22–23, 273–274, 340Freakonomics, 187Freddie Mac, 273Free market, 371Free trade, 203, 222Friction, 354Friedman, Thomas L., 7, 10–16, 134,197–198, 201–207Full spectrum dominance, 146Fusaro, Peter, 306Future, 369–370Futures, 303http://www.pboElections (Continued)number of voters, 193presidential, 55–56Electronic Herd, 206Elphinstone, William, 209–212Emotional mind, 69Emotions, 356Employee Benefit Research Institute,316Energy consumption, 12–15Energy Hedge Fund Center, 306Energy trading, 305–306Engineers, software, 220–221England, 296Environmental regulations, 228Equality, 190–192Equities, 352Equity, private, 341–342Essay Concerning Human Understanding,An, 25Europe, 282European Union, 215, 228–229EverBank 5-Year MarketSafe GoldBullion CD, 362Evolution, 40–42, 44Exchange-traded funds (ETFs), 363Expert Political Judgment—How Good IsIt? How Can We Know?, 369Exploitation, 227Exports, 353Extraordinary Popular Delusions and theMadness of Crowds, 84ok416July 18, 2007Faber, Marc, 284Fair play, 70Famine, 128, 180, 208–209, 214–215Fanaticism, 170Fannie Mae, 31, 273Farce, 136Farrell, James Augustus, 313Fassihi, Farnaz, 102Fat tails, 229–230Ganek, David, 313Gannon, Jeff, 102Gates, Bill, 329GATT (General Agreement on Tradeand Tariffs), 228–229Gaussian distribution, 230Geithner, Timothy, 302General Agreement on Trade andTariffs (GATT), 228–229General Electric, 349General Motors, 31, 283Germany, 120, 172, 285–286Gibbons, Jenny, 85Gini index, 199Gladwell, Malcolm, 41
JWPR031-Bonner-SampleJuly 18, 200722:35Indexcomfederal government’s percentage of,291of India, 225shares of world, 264Group identity, 43, 122Group integrity, 188–190Group prejudices, 43Groups. See also Crowdsdifferences from crowds, 367–368Groupthink, 190Guanahacabibes, 157Guerrilla war, 156Guevara, Che, 151–160okshop.Haidt, Jonathan, 69Halliday, Jon, 173Happiness, 21–22, 24–25, 27Harkis, 70–71Hartog, Hendrik, 25–26Hassan-i-Sabah, 18–19Hedge Fund Index, 305Hedge funds. See also Derivatives2-and-20 terms, 38assets, 305–306assets-to-equity ratio, 307–308net worth of managers, 315–316returns, 304–305Helú, Carlos Slim, 329Herding behavior, 231Hewlett-Packard, 31Hill & Knowlton, 103History, 374, 381–384Hitchens, Christopher, 101Hitler, Adolf, 7–8, 50, 359–360,386–387Hoffer, Eric, 106–107Home equity, 271, 276, 281Honesty, 45. See also LiesHong Kong, 65–67, 236Housing, 194, 260–261boom, 270, 327as investment, 270–271http://www.pboGlobal trade, 235Globalization, 197–215acceptable positions on, 234commerce, 219–223defense of, 228–229downside of, 224and free trade, 222and India, 224–225and technology, 310Glory, 378, 381Gödel’s theorem, 206Gold, 352versus paper money, 372rise versus fall of dollar, 362Gold-backed dollar, 281, 282, 292Golden Quadrilateral, 219Golden Straitjacket, 206Goldman Sachs, 279, 284, 307–308Good Friday, 379–380Google, 297, 315Göring, Hermann, 34Graham Capital Management, 314Grantham, Jeremy, 351Great Burning, 82Great Depression, 310, 325Great Hunger, 214–215Great Hunt, 85, 86Great Leap Forward, 180Great War, 117. See also World War IGreenspan, Alan, 246–254as chairman of the Federal ReserveBank, 286–295and debt, 251and home prices, 281and inflation, 248and recession of 2001–2002, 253and savings, 252and stock market crash of 1987, 248and trade deficit, 258Greenwich, CT, 313Gross domestic product (GDP), 259of Asia, 120, 265417
JWPR031-Bonner-Sample22:35INDEXhttp://ww.pwIcahn, Carl, 315Identity, group, 43Imperial power, 133, 135Imports, 238Impression management, 30In Defense of Globalization, 228In-Q-It, 141Inaction, 359–360Incomeinequality, 199, 261per capita in Hong Kong, 236per capita in India, 236per capita in Latin America andAfrica, 240and trade restrictions, 238U.S., 261–262Indiaand automotive industry, 222and the British Empire, 208and commerce, 219–223Coromandel Coast, 216shop.comfamine, 208–209food production, 238–239and globalization, 224–225gross domestic product (GDP), 225industrialization, 239inflation rate, 239per capita income, 236poverty, 330and software engineers, 220–221U.S. aid to, 236–237Indian Institute for Technology (IIT),221Industrial workers, 199Industrialization, 239Inequality, 199, 261Inflationand Alan Greenspan, 248in Argentina, 161, 166, 339in Germany, 285–286in India, 239and investments, 349and loans, 309and paper money, 255and redistributed wealth, 264–265and savings, 283and taxes, 291Influence, 42–44Information technology, 197Initial public offerings (IPOs), 301–302Innocence, 98–99Insiders, 357Instincts, 40–42, 61–63Integrity, 188–190Intelligenceand intuition, 67–69private contractors, 141Interest rates, 251, 296, 349International Monetary Fund (IMF),205, 276–277Internet, 276Intuition, 62, 67–69Investment markets, 342–345boHousing (Continued)median price, 277–278prices, 258, 267–268, 269, 276–277,281, 296, 307reasons for price correction, 275–276supply, 270tying up securities, 298Hulbert, Mark, 335–336, 361Human nature, 370–374Humansand influence, 42–44predicting behavior, 369Hummers, 27–28Hungary, 307Hunter, Brian, 300, 303, 306Hussein, Saddam, 4, 104–105, 138, 146Hybrid cars, 12–15Hyderabad, 220Hyperinflation, 285Hysteria, 92–97ok418July 18, 2007
JWPR031-Bonner-SampleJuly 18, 200722:35Investments, 354–356advising, 332–336housing, 270–271methods, 352newsletters, 332–334value of a business, 348Investorsdot-com, 252and emotions, 356and history, 384IPOs (Initial public offerings), 301–302Iran, 146Iraq, 11, 51–52, 136and British rule, 144deaths and costs of war, 145U.S. goal in, 12Iraqi National Congress, 104Ireland, 212–215Ivan’s War, 127–128Kramer, Heinrich, 86–87Krispy Kreme, 31KUBARK, 140Jackson, Thomas “Stonewall,” 118–119Jacobs, Joseph, 313Japanand consumer credit, 251interest rates, 296return on equities, 352stock market, 249, 296and trade restrictions, 225Jenkins, Roger, 284Jesus, 380Jews, 366–367Jobs, Steve, 315Jones, Alfred Winslow, 305Jones, Paul Tudor, 313–314, 315Junk bonds, 308Justicialismo, 164okIndexshop.comLabor, 157, 209, 353Labor market, U.S., 203Lal, Deepak, 133Late Great Planet Earth, The, 93Latin America, 240LaVey, Anton, 96Law of marginal utility, 329, 331Le Bon, Gustave, 188Lee, Bandy Xenobia, 53–54Lee, Robert E., 119Leopold II, 108Leuthold, Steve, 351–352Level Global Investors, 313Levitt, Steven, 187, 232Lewis, Michael, 341Lexus and the Olive Tree, The, 206Lies, 44–46Limbic system, 27, 62Lindsey, Hal, 93Liquidity, 388Literary intelligence, 68Livengood, Scott, 31Llosa, Alvaro Vargas, 159Loans, 308–309defaults, 278and inflation, 309subprime, 272, 273, 278, 281, 299Locke, John, 21, 25LondonBlitz, 123–126commercial real estate, 284hedge funds managers, 316and world’s financial assets, 284–285London Stock Exchange, 302Long March, 175, 177Long Term Capital Management(LTCM), 306Long-term loans, 308–309bo.pww//wtp:htKabul, 209–212Kahneman, Daniel, 232Kennedy, Paul, 134Korb, Lawrence, 139419
Maalouf, Amin, 17–20Mackay, Charles, 84Macroeconomics, 259–265Madras, 217–223Mahabharatha, 102Malleus Maleficorum (The Hammer of theWitches), 86–87Manchukuans, 180Mann, Thomas, 285Mao Tse-tung, 173–182Marginal utility, law of, 329, 331Market commentary, 324Market reforms, 65Markets of investment, 342–345Marriage, 24–26Marshall, George, 179Marx, Karl, 373–374Marxism, 153Mass mania, 80Masterman, Charles, 109–110McMartin Preschool, 89–92McWilliams, David, 212–213Media war, 101–102Mei Moses all art index, 38Meiwes, Armin, 3–4Men, 7–8, 28–29, 41, 69Menem, Carlos, 161, 166Merridale, Catherine, 127–128Merrill Lynch, 355Michelle Remembers, 92–93Middle East, 8–9, 154Military personnel, 33, 117–119, 143Mind, 69Minneapolis, 275–276Mitford, Diana, 5–6Mobsthinking, 70, 75–79violence, 165and words, 86Moneyborrowed, 250how to avoid losing it, 323–363supply, 250, 259value of, 331Money, paper. See Paper moneyMoral rules, 386Moral thinking, 69Morales, Evo, 151Morgan Stanley, 284, 306Mortgage-backed securities, 273, 298Mortgagesequity, 271fraud, 273–274and Greenspan, 294lenders, 271–272nontraditional, 272Mosley, Oswald, 5Motorcycle Diaries, 151Mulele, Pierre, 159Multi-victim multi-offender childabuse cases, 91Muslims, 18–20Mussolini, Benito, 4–5Myers, Richard, 57–58Myth of diabolical conspiracy, 88–89shoLos Angeles, 267–268Love, 21–46Luftwaffe, 124–125Lytton, Lord, 208–209ok420July 18, 2007Naipaul, V. S., 159Narcissistic personality disorder, 53–54National Socialism, 164Natural gas, 303Natural selection, 41Nazism, 172, 367Near East, 16–20Negative amortization mortgage, 272Neocortex, 81, 87, 186New Century Financial Corporation,278New Jersey, 310–311New socialist man, 157–158
JWPR031-Bonner-SampleJuly 18, 200722:35Indexww.pcomp.shoboOffice of Global Communications(OGC), 105Office of Strategic Information (OSI),105Oil prices, 12–16Opium, 179Options market, 308Order, spontaneous, 366, 370Origin of Satan, The, 80Orizio, Riccardo, 6Outreau affair, 77–79Ownership, foreign, 264Phelps, Edmund, 323Plachimada, 217Poincaré, Jules Henri, 325Pope’s Children, The, 212Population, world, 200Potato famine, 214–215Poverty, 195, 223, 330Power-law distribution, 231–232Prawns, 216, 224Prebisch, Raul, 165Predictions, 369–370Present value, 349Presidential election, 2004, 55–56Press, theand Belgium, 108–110in China, 179damage it causes, 103–105as principal organ of mob sentiment,75–79Price controls, 255Pricesart, 35–36housing, 258, 260–261, 266–279,281, 296, 307manipulating, 340Pricing, 371Priest, Dana, 138Private equity, 341–342Private intelligence, 141Probst, Christoph, 72Propaganda, 105–107, 109–110Prosperous British India, 208Purchasing power, 255, 285, 331Put option, 308okNew York Stock Exchange, 297Newsletters, investment, 332–334Newspapers. See Press, theNiederhoffer, Victor, 233NKVD (People’s Commissariat forInternal Affairs), 127Noble rot, 376Normandy, 50–51North, Gary, 334–335North Korea, 146, 156Notional sum derivatives, 296–297http://wPage, Larry, 315Pagels, Elaine, 80, 88–89Panic, 57, 89–92, 126Paper money, 255, 292defunct, 256–257versus gold, 372and housing prices, 281Paulos, George, 275–276, 277Paulson, Hank, 284Pazder, Lawrence, 92–93Peloponnesian War, 129–131People’s Commissariat for InternalAffairs (NKVD), 127Pericles, 129–131Perón, Evita, 167–171Perón, Juan, 160–166, 168, 171Peso, 166421Qin Shi Huangdi, 176Rainbow Tour, 169Raines, Franklin, 31Ramanujan, Sreenivas, 220Rampton, Sheldon, 106Rate of return, annual, 351
JWPR031-Bonner-Sample22:35INDEXhttp://wwSaint Gobain, 219–223Salaries, 30–33Salomon, Robert S., Jr., 251Sartre, Jean-Paul, 155, 180Satan, 80, 85, 96Satan’s Underground, 93Savings, 252, 263, 283, 327okshop.comSchlieffen Plan, 107Schmidt, Eric, 315Scholl, Sophie and Hans, 72Schrage, Michael, 101Securities, 273, 298Securities and Exchange Commission(SEC), 381Self-esteem, 122Self-sufficiency, food, 239Semel, Terry, 315September 11, 2001, 22, 56, 201, 233,252–253Serotonin, 47–487-Eleven, 202Sex, 76, 86, 99, 100Shelton, John, 210–211Shiism, 18–19Short-term loans, 308–309Simmons, Zalmon Gilbert, 314Simon, James, 315Sjuggerud, Steve, 344, 352–353, 363Slavery, 59–60Smith, Michelle, 92–93Social capacity, 186–188Social intelligence, 68–69. See alsoIntuitionSoftware engineers, 220–221Somerset-Webb, Merryn, 48Soros, George, 315Soviet Union, 128, 138–139S&P 500, 32Speculator, 342–344Spy trade, 141–142Stagflation, 166Stalin, Joseph, 7–8, 117Starvation, 128, 180Stock marketand astrology, 48bear market, 344, 351bull market, 350collapse of 1949, 170crash of 1987, 247–248bowRationality, 374Real estatecommercial, 284as investment, 347residential, 266–279when to buy, 361Reason, 69, 372–373, 374Recession, 248, 253Reciprocity, 122Red Army, 129Refinancing, 271Regulations, 228, 233–234Religion, 376–377Remembrance Day, 113–114Remington Rand, 314Renaissance Technologies, 315Rendon, 104–105Reno, Janet, 94–95Reputation, 122Retained earnings, 327Return on investment, 351–352Reynald de Chatillon, 18, 20Ricardo, David, 203Risk, 230, 349–350assessment, 232reactions to, 232–233and terrorism, 56Roach, Stephen, 198–199Robespierre, 155Robin, “Red,” 333–334Rodrik, Dani, 65Romance, 25, 26–27Rumsfeld, Donald, 146Russia, 117.p422July 18, 2007
JWPR031-Bonner-SampleJuly 18, 200722:35Index423Tokyo stock market, 249Torture, 140, 175Tradeliberalization, 225restrictions, 225, 238unfair, 227and World Bank, 237Trade deficit, 27–28, 258, 294Traditions, 372, 373Tropin, Kenneth, 314Trump, Donald, 267Tudor Investment, 3152-and-20 terms, 38Tyranny, 53–54Taleb, Nicholas Nassim, 22, 231Talk of the Devil: Encounters with SevenDictators, 6Tamil Nadu, 220, 222Tanks, 119Taxes, 215, 291Technologyand globalization, 310and housing prices, 275Telconia, 107Telecoms, 250Templeton, John, 236Tenet, George, 141Terrorismand CIA, 138–142differences from Blitz, 124–126and election of 2004, 56–58reactions to, 22risk, 56war on, 150Tetlock, Philip, 369Thailand, 307Theory of comparative advantage,203Thrift, 326–327Time, 375Titan Corporation, 141Unemployment, U.S., 203–205Unintended consequences, 222United Statesaid to India, 236–237, 239assets in foreign hands, 295cost of elections, 187as debtor nation, 294–295, 307economy after World War II, 283enemies, 137–138financial assets, 330income, 199, 261–262and Mao Tse-tung, 179propaganda, 106–107residential real estate, 266–279trade restrictions, 225unemployment, 203–205and war in Afghanistan, 133way to get responsible government,346–347workers’ earnings, 265United Technologies Corporation,32–33http://www.pbookshop.comcycles, 382and history, 383–384Japanese, 296life cycle, 350Stocks, 355, 360Stonecipher, Harry, 31Storyboarding, 101, 103Stratford, Lauren, 93Subprime loans, 272, 273, 278, 281,299Suicidal statecraft, 144Sunnites, 18–19Surowiecki, James, 364–368Survival, 43Value-at-risk, 307Venezuela, 15, 307Venkataswamy, Govindappa, 241–242Verum factum, 373
JWPR031-Bonner-Sample424July 18, 200722:35INDEXhttp://wwwp.shookbo.pWacziarg, Romain, 65Wages, 261, 262Wagoner, Rick, 31Wars, 80–81absurd reasons for, 59–60as farces, 117–120Iraq, 11, 145and the media, 101–102on terror, 150without blood, 141Water supply, 344–345, 353Wealth, 133, 315–316accumulation of, 326Americans, 285distribution across the world, 200how much is rich?, 329–331redistributed, 264–265richest people, 329transfer, 285Wehrmacht, 127Weingarten, Henry, 48Welfare State We’re In, The, 65–67Wenar, Leif, 57Wexford Capital, 313White Rose Society, 72Wiccans, 96Williams, Arland D., Jr., 379Wisdom of Crowds, 364–368Witches, 80, 81–87Women, 28–29, 69, 80–87Work for All, 215Workers, 203, 262Working class, 170World Bank, 235–242World improvers, 3–20, 50–51World Is Flat, The, 197, 203World
JWPR031-Bonner-Sample July 18, 2007 22:35 INDEX Abuse, child, 89–95 Adjustable-rate mortgages (
