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Keynes and the Market: How the World's Greatest Economist Overturned Conventional Wisdom and Made a Fortune on the Stock Market
Keynes and the Market is an entertaining guide to John Maynard Keynes– amazing stock market success. It weaves the economist's value investing tenets around key events in his richly lived life. This timely book identifies what modern masters of the market have taken from Keynes and used in their own investing styles–and what you too can learn from one of the greatest economic thinkers of the twentieth century. If you want to profit in today's turbulent stock market the techniques outlined here will put you in a better position to succeed.
212 pages, Hardcover
First published January 1, 2008
44 people are currently reading
348 people want to read
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Displaying 1 - 24 of 24 reviews
August 18, 2021
I was a little challenged by this book. I came to it with an understanding of Keynesian economics and with a bit of knowledge of Keynes' investment activities. I was hoping for new insights, which were largely absent. I did enjoy the biographical material about Keynes, but I feel that the author could have been a little more forceful about Keynes as an influencer of policy. However, the book was about neither of these.
The book sets out to highlight Keynes' method as an investment manager. It's a pity that it then spends so much time dwelling upon Berkshire Hathaway. Admittedly, they have a similar view towards investing, but despite both Berkshire Hathaway and Keynes arriving at a similar place, they have both taken different routes. I wanted to read more about Keynes' growing practice and less about Warren Buffet.
So what is Keynes' method? It's fairly straightforward. Bide your time. Wait until a stock is appreciably undervalued. Then go large on it. And be reluctant to sell. It sounds easy, and it is, but these platitudes offer no practical assistance at all. Biding your time means being patient in an impatient world. That is a question of personal restraint.
Knowing a stock is appreciably undervalued is easier to say than to do. The book offers very little assistance in this aspect of the technique. All it suggests is that you study your potential target very carefully, but it doesn't say for what or how you will know when the time to act has arrived. In this regard, the reader is sold short. Equally, going large is a question of degree. The book offers no guidance on an appropriate amount to invest. How do we know if our stake is reckless? Or too timid? These are judgement calls for which the reader can expect no assistance from the author.
Then there is the question of selling. At some point the company bought will go into decline. How will we know when that has happened? How did Keynes deal with this conundrum? It is in this area that I found the book to be superficial. When I wanted penetrating analysis, I received bland platitudes. This, of itself, was disappointing.
The book is well written and, even better, well edited. It sticks to the point, even if it lacks a certain depth, and is amusing to read. It gives the broadest of oversight on Keynes' investment activities. It quotes Berkshire Hathaway more than is respectably decent, but it doesn't challenge the reader any way at all. It is a useful introduction for those who have heard of Warren Buffet, but who are unaware of Keynes' investment activities. For anyone wanting a bit more than a cursory introduction, they had better look elsewhere.
The book sets out to highlight Keynes' method as an investment manager. It's a pity that it then spends so much time dwelling upon Berkshire Hathaway. Admittedly, they have a similar view towards investing, but despite both Berkshire Hathaway and Keynes arriving at a similar place, they have both taken different routes. I wanted to read more about Keynes' growing practice and less about Warren Buffet.
So what is Keynes' method? It's fairly straightforward. Bide your time. Wait until a stock is appreciably undervalued. Then go large on it. And be reluctant to sell. It sounds easy, and it is, but these platitudes offer no practical assistance at all. Biding your time means being patient in an impatient world. That is a question of personal restraint.
Knowing a stock is appreciably undervalued is easier to say than to do. The book offers very little assistance in this aspect of the technique. All it suggests is that you study your potential target very carefully, but it doesn't say for what or how you will know when the time to act has arrived. In this regard, the reader is sold short. Equally, going large is a question of degree. The book offers no guidance on an appropriate amount to invest. How do we know if our stake is reckless? Or too timid? These are judgement calls for which the reader can expect no assistance from the author.
Then there is the question of selling. At some point the company bought will go into decline. How will we know when that has happened? How did Keynes deal with this conundrum? It is in this area that I found the book to be superficial. When I wanted penetrating analysis, I received bland platitudes. This, of itself, was disappointing.
The book is well written and, even better, well edited. It sticks to the point, even if it lacks a certain depth, and is amusing to read. It gives the broadest of oversight on Keynes' investment activities. It quotes Berkshire Hathaway more than is respectably decent, but it doesn't challenge the reader any way at all. It is a useful introduction for those who have heard of Warren Buffet, but who are unaware of Keynes' investment activities. For anyone wanting a bit more than a cursory introduction, they had better look elsewhere.
June 8, 2021
A sprinkling of nice aphorisms throughout doesn’t outweigh the fact that this is just a Buffet/Munger value investing piece - with nothing really new coming out of it.
February 15, 2010
Insights into Keynes the investor
Now that everybody seems to be a Keynesian again, the perfect time may have arrived to revisit Keynes’s oft-overlooked – and wildly successful – strategies for succeeding in the stock market. This lively look at Keynes’s evolution as an investor is sure to convince readers that value investing is a wise approach. With pithy language and an engaging style, investment banker and financial reporter Justyn Walsh points out that Warren Buffett isn’t the only value investor worth emulating. Investors familiar with Buffett’s mantras will find little new advice here, but Walsh does an admirable job of casting Keynes’s life in a new light. He also concisely sums up Keynes’s economic theory. getAbstract recommends this book to investors looking for insight from one of capitalism’s great minds.
To learn more about this book, check out the following link: http://www.getabstract.com/summary/11...
Now that everybody seems to be a Keynesian again, the perfect time may have arrived to revisit Keynes’s oft-overlooked – and wildly successful – strategies for succeeding in the stock market. This lively look at Keynes’s evolution as an investor is sure to convince readers that value investing is a wise approach. With pithy language and an engaging style, investment banker and financial reporter Justyn Walsh points out that Warren Buffett isn’t the only value investor worth emulating. Investors familiar with Buffett’s mantras will find little new advice here, but Walsh does an admirable job of casting Keynes’s life in a new light. He also concisely sums up Keynes’s economic theory. getAbstract recommends this book to investors looking for insight from one of capitalism’s great minds.
To learn more about this book, check out the following link: http://www.getabstract.com/summary/11...
September 9, 2021
케인즈의 투자에 대한 이야기인데, 그냥 지극히 평범한 가치투자 서적 한 권을 본 것 같이 별 감흥이 없었다.
November 12, 2021
Keynes began as a speculator and market time, and transformed to an early value investor. He followed several key principles: (1) focus on intrinsic value, (2) a margin of safety when the pendulum of investor sentiment moves too far, (3) contrarianism/indepedence, (4) trade infrequently, (5) be concentrated and (6) appropriate balance between equanimity and patience.
He was wary of chasing money for money's sake and had an ambivalent attitude in the pursuit of wealth; it was purely a way to 'live wisely and agreeably'. He was interested in stocks at a time bonds were considered the only credible investment, and was drawn to their ability to compound retained earnings. He aimed to take advantage of 'animal spirits', that results in expectations for future cash flows of a business to vary widely month-to-month or year-to-year. Keynes was a pragmatist: never too tightly wed to any particular view. He said “I’m afraid of principle”. Keynes maintained economics is a ‘technique of thinking, not a body of settled conclusions.’ He was wary of classical economics and orthodox theory that relied on assumptions that did not hold in the chaos of real-life, and that were conveniently disregarded in the interests of theoretical elegance.
The economy exhibits ‘emergent properties’: complex, sometimes unpredictable, collective behaviour in a system, arising out of the multiplicity of interactions between its individual constituents.
Humans do not make cold, clinical analysis of expected outcomes and probabilities. Due to uncertainty most events cannot be assigned an accurate probability and therefore produce a precise calculation of expected value. If acting purely rationally in investment decisions, we should be rendered immobile by the daunting ‘what ifs’ of an unknowable future, and like Buridian’s ass, who was faced with two equally attractive and accessible bales of hay, starved while deliberating which one was preferable. We instead resort to less analytical factors when assessing stock market opportunities: “to avoid being in the position of Buridan’s ass, we fall back on motives that are not rational in the sense of being concerned with the evaluation of consequences, but are decided by habit, instinct, preference, desire, will etc”. As Keynes summarised: “a large proportion of our positive activities depend on spontaneous optimism, rather than on a mathematical expectation, whether moral or hedonistic or economic. Most, probably, if our decisions to do something positive, the full consequences of which will be drawn out over many days to come, can only be taken as a result of animal spirits and not as the outcome of a weighted average of quantitative benefits multiplied by quantitative probabilities.
He realised an over-emphasis on quantitative factors could be dangerous in downplaying the importance of non-numerical elements. Refers to Einstein qu0te: "Not everything that counts can be counted; and not everything that can be counted counts."
Keynes asserted that investors must exercise “constant vigilance, constant revision of preconceived ideas, constant reaction to changes in the external situation”.
“It is because particular individuals, fortunate in situation or abilities, are able to take advantage of uncertainty and ignorance... that great inequalities of wealth come about”.
“Very few American investors buy any stock for the sake of something which is going to happen more than six months hence, even though it’s probability is exceedingly high; and it is out of taking advantage of this psychological peculiarity that most money is made”.
“I believe now that successful investment depends upon (among other things) a steadfast holding of fairly large units through thick and thin, perhaps for several years.”
“It is out of these big units of the small number of securities about which one feels absolutely happy that all one’s profits are made. Out of the ordinary mixed bag of investments nobody ever makes anything”.
“My theory of risk is that it is better to take a substantial holding of what one believes shows evidence of not being risky rather than scatter holdings in fields where one has not the same assurance”.
“There are seldom more than two or three enterprises at any given time in which I personally feel myself entitled to put full confidence”.
“To suppose that safety first consists in having a small gamble in a large number of different directions, as compared with a substantial stake in a company where one’s information is adequate, strikes me as a travesty of investment policy. “
“The inactive investor who takes up an obstinate attitude about his holdings and refuses to change his opinion merely because facts and circumstances have changed is one who in the long run comes to grievous loss.”
“When facts change, I change my mind. What do you do, sir?”
"I would rather be vaguely right than precisely wrong "
He was wary of chasing money for money's sake and had an ambivalent attitude in the pursuit of wealth; it was purely a way to 'live wisely and agreeably'. He was interested in stocks at a time bonds were considered the only credible investment, and was drawn to their ability to compound retained earnings. He aimed to take advantage of 'animal spirits', that results in expectations for future cash flows of a business to vary widely month-to-month or year-to-year. Keynes was a pragmatist: never too tightly wed to any particular view. He said “I’m afraid of principle”. Keynes maintained economics is a ‘technique of thinking, not a body of settled conclusions.’ He was wary of classical economics and orthodox theory that relied on assumptions that did not hold in the chaos of real-life, and that were conveniently disregarded in the interests of theoretical elegance.
The economy exhibits ‘emergent properties’: complex, sometimes unpredictable, collective behaviour in a system, arising out of the multiplicity of interactions between its individual constituents.
Humans do not make cold, clinical analysis of expected outcomes and probabilities. Due to uncertainty most events cannot be assigned an accurate probability and therefore produce a precise calculation of expected value. If acting purely rationally in investment decisions, we should be rendered immobile by the daunting ‘what ifs’ of an unknowable future, and like Buridian’s ass, who was faced with two equally attractive and accessible bales of hay, starved while deliberating which one was preferable. We instead resort to less analytical factors when assessing stock market opportunities: “to avoid being in the position of Buridan’s ass, we fall back on motives that are not rational in the sense of being concerned with the evaluation of consequences, but are decided by habit, instinct, preference, desire, will etc”. As Keynes summarised: “a large proportion of our positive activities depend on spontaneous optimism, rather than on a mathematical expectation, whether moral or hedonistic or economic. Most, probably, if our decisions to do something positive, the full consequences of which will be drawn out over many days to come, can only be taken as a result of animal spirits and not as the outcome of a weighted average of quantitative benefits multiplied by quantitative probabilities.
He realised an over-emphasis on quantitative factors could be dangerous in downplaying the importance of non-numerical elements. Refers to Einstein qu0te: "Not everything that counts can be counted; and not everything that can be counted counts."
Keynes asserted that investors must exercise “constant vigilance, constant revision of preconceived ideas, constant reaction to changes in the external situation”.
“It is because particular individuals, fortunate in situation or abilities, are able to take advantage of uncertainty and ignorance... that great inequalities of wealth come about”.
“Very few American investors buy any stock for the sake of something which is going to happen more than six months hence, even though it’s probability is exceedingly high; and it is out of taking advantage of this psychological peculiarity that most money is made”.
“I believe now that successful investment depends upon (among other things) a steadfast holding of fairly large units through thick and thin, perhaps for several years.”
“It is out of these big units of the small number of securities about which one feels absolutely happy that all one’s profits are made. Out of the ordinary mixed bag of investments nobody ever makes anything”.
“My theory of risk is that it is better to take a substantial holding of what one believes shows evidence of not being risky rather than scatter holdings in fields where one has not the same assurance”.
“There are seldom more than two or three enterprises at any given time in which I personally feel myself entitled to put full confidence”.
“To suppose that safety first consists in having a small gamble in a large number of different directions, as compared with a substantial stake in a company where one’s information is adequate, strikes me as a travesty of investment policy. “
“The inactive investor who takes up an obstinate attitude about his holdings and refuses to change his opinion merely because facts and circumstances have changed is one who in the long run comes to grievous loss.”
“When facts change, I change my mind. What do you do, sir?”
"I would rather be vaguely right than precisely wrong "
June 23, 2021
Being a poor student of economics, I didn't quite catch the first half of the book. It was only towards the second half of the book that I understood better on what the author was writing about.
Essentially it's about Keynes and his approach to value investing. The author quotes Charlie Munger and Warren Buffet frequently, since they're the contemporaries of our time who echo the similar approach Keynes had in investments.
I learnt it's ok to have a concentration of certain stocks if they're doing well. To do a portfolio rebalancing by selling the winners would be akin to Bulls selling Michael Jordon because he became too important to the team.
It is also important to have a wide margin of safety, so that one can be successful in value investing.
Overall a good read. If one wants to capture the essence of the book, start reading from the second half. 😊
Essentially it's about Keynes and his approach to value investing. The author quotes Charlie Munger and Warren Buffet frequently, since they're the contemporaries of our time who echo the similar approach Keynes had in investments.
I learnt it's ok to have a concentration of certain stocks if they're doing well. To do a portfolio rebalancing by selling the winners would be akin to Bulls selling Michael Jordon because he became too important to the team.
It is also important to have a wide margin of safety, so that one can be successful in value investing.
Overall a good read. If one wants to capture the essence of the book, start reading from the second half. 😊
August 22, 2021
Rating: 3.0/5
The book acts as a good introduction to value investing to the uninformed reader. Hence, it was a decent read. The author also goes over the life of Keynes and how Keynes evolved as an investor, succeeding and failing in implementing various investment strategies and then finally settling onto value investing. However, this is where the value of the book ends. Towards the second half of the book, there is a lot of emphasis on Warren Buffet and Benjamin Graham instead of Keynes. Moreover, Keynes simply did not experiment with enough investment strategies for the book to act as a complete overview of the financial investments. The book provides little data and while the topic covered is interesting, there is simply not enough content to be explored.
The book acts as a good introduction to value investing to the uninformed reader. Hence, it was a decent read. The author also goes over the life of Keynes and how Keynes evolved as an investor, succeeding and failing in implementing various investment strategies and then finally settling onto value investing. However, this is where the value of the book ends. Towards the second half of the book, there is a lot of emphasis on Warren Buffet and Benjamin Graham instead of Keynes. Moreover, Keynes simply did not experiment with enough investment strategies for the book to act as a complete overview of the financial investments. The book provides little data and while the topic covered is interesting, there is simply not enough content to be explored.
January 15, 2025
This is more of a biography of the great man. The book according to me did not add value in understanding what is the approach or what to do in the financial world and the book is not straight forward on what to do. The language used is quite heavy for me, I was referring to the dictionary and words over google more often while reading this book.
What I really liked are the quotes which were interspersed across the book. Some of the quotes are real gem and worth going through again, if life affords the luxury or the financial independence of doing so.
What I really liked are the quotes which were interspersed across the book. Some of the quotes are real gem and worth going through again, if life affords the luxury or the financial independence of doing so.
April 16, 2021
A mix of a biography on Keynes and his professional life - with added focus on his financial market adventures - and his investment methodology which is essentially a qualitative, value-focused investment strategy.
Nothing special. Any budding investors are better off reading "The Intelligent Investor" or "Buffettology".
Nothing special. Any budding investors are better off reading "The Intelligent Investor" or "Buffettology".
May 24, 2021
Well articulated keynes life with his way of looking at investing and adhering to different tenets. Starting with short term investing and then moving to value investing ,which is, intrinsic value compared to current stock value. Covered key principle like safety net, long term view, uncertainty exists
April 13, 2021
Not good
October 29, 2022
A very important book! Loved it, totally
December 25, 2023
Great introduction to Keynes, his theory, and investment strategies.
July 6, 2024
So far a very difficult read...not extract enough summary about Keynes investment philosophy yet
October 6, 2024
Interesting read that covers a lot of ground and provides an insight into Keynes' understanding of financial markets.
December 16, 2024
Excellent read
January 29, 2025
Informative and very clearly outlined. Would recommend!
December 9, 2025
Not enough detail. It's like someone browsed the internet for a few weeks and decided to 'write a book'.
January 1, 2019
My rating is strict, but if you've read 10+ books on investing, you are unlikely to find much new here. I thought this book would discuss some of Keynes actual investments and I figured, it might be a difficult task for the author to find the specifics all these years later and read up on the companies and discern their quantitative and qualitative aspects. >>> It turns out, there is pretty much no discussion of any of Keynes' actual investments. Strangely, I don't recall a list of ANY of his holdings mentioned in the book! I guess that would've been too much work...
I don't even recall any mention of specific aspects Keynes looked at, when deciding what made a good investment! It's just hammered home again and again, that Keynes looked at intrinsic value (add up all the likely future dividends/earnings of a company) and compared it to the offered price of the market.
You will read again and again and again the same general principles:
- margin of safety (21 times!)
- Mr Market (23 times!)
- circle of competetence (only 6 times!)
- holding for the long term
- avoiding market noise
I'm not even clear after just finishing the book minutes ago, if John Maynard Keynes ever used the term "margin of safety" himself, but he was a contemporary of Benjamin Graham, so perhaps. My suspicion is, the author read Keynes' letters, chose a few choice sentences to sprinkle throughout the book, but then mostly free-styled the usual value minded investing aspects. A certain man from Omaha was only a teenager when Keynes passed away, but guess what:
Not counting notes and sources, Warren Buffett is mentioned (quick count...) 35 times in the text. You get the idea, that the author has read much of what the average well-read investing-book-junkie has read.
I don't even recall any mention of specific aspects Keynes looked at, when deciding what made a good investment! It's just hammered home again and again, that Keynes looked at intrinsic value (add up all the likely future dividends/earnings of a company) and compared it to the offered price of the market.
You will read again and again and again the same general principles:
- margin of safety (21 times!)
- Mr Market (23 times!)
- circle of competetence (only 6 times!)
- holding for the long term
- avoiding market noise
I'm not even clear after just finishing the book minutes ago, if John Maynard Keynes ever used the term "margin of safety" himself, but he was a contemporary of Benjamin Graham, so perhaps. My suspicion is, the author read Keynes' letters, chose a few choice sentences to sprinkle throughout the book, but then mostly free-styled the usual value minded investing aspects. A certain man from Omaha was only a teenager when Keynes passed away, but guess what:
Not counting notes and sources, Warren Buffett is mentioned (quick count...) 35 times in the text. You get the idea, that the author has read much of what the average well-read investing-book-junkie has read.
October 26, 2014
Written really well making the book a enjoyable read especially as the flow of the book made it easy to follow the ideas being laid out.
On top of that the content is great, really explores the idea of value investing into depth as the reader also classically dishes out timeless quotes and tidbits from Warren Buffet and Charlie Munger...I mean a value investing book is not complete without their mention. Definitely one of the best books i have read on value investing to date, plus after studying Keynes in economics it's great to learn about the investor keynes, adds more life to my current understanding of him.
That said this book also inspired me to read Keyne's general theory of employment, interest and money.
After reading this make it makes me wonder if Keynes ever met or was influenced by Benjamin Graham since their ideas and investing principles were so similiar.
On top of that the content is great, really explores the idea of value investing into depth as the reader also classically dishes out timeless quotes and tidbits from Warren Buffet and Charlie Munger...I mean a value investing book is not complete without their mention. Definitely one of the best books i have read on value investing to date, plus after studying Keynes in economics it's great to learn about the investor keynes, adds more life to my current understanding of him.
That said this book also inspired me to read Keyne's general theory of employment, interest and money.
After reading this make it makes me wonder if Keynes ever met or was influenced by Benjamin Graham since their ideas and investing principles were so similiar.
January 13, 2019
The author should have given a more detailed analysis on Keynes' holdings over the years. Keynes' investing philosophy presented in this book is very much like Buffett's: margin of safety, enterprise value, buy and hold strategy, concentrated investing, moat and making use of Mr. Market... I just can't find many new ideas in this book. At some point, I started to wonder whether this book is about Warren Buffett or John Keynes.
March 24, 2022
who knew our greatest economist was a great investor
The story of Keynes the economist and statesman are well known, but that he was an early practitioner of value investing isn’t- and it should be.
The story of Keynes the economist and statesman are well known, but that he was an early practitioner of value investing isn’t- and it should be.
April 27, 2015
Cliched and without insight, this works as a half-decent, very short, biography of Keynes. For actual investing, market analytic, historical economic or policy insight, look elsewhere.
December 2, 2018
totally loved this book, was a great recap of value investing in plain english. good for beginners or for a general recap about value investing and a tad of Keynesian economic theory.
Displaying 1 - 24 of 24 reviews