Edwin Lefevre on manias:
"Intoxicated by success, forgetting the lesson of the lean years, men lose their normal business prudence. They increase the output of their factories or of their mines without duly considering the demand for their goods; they buy much and produce more.
They've seen friends acquire wealth in a few lucky prosperous months; they'd do likewise, whether it is in dry goods, pig iron, rawhides or stocks. Greed, a species of moral malaria, fills their system, poisons their blood & colors their thoughts with the jaundice hue of gold."
"As the fever rises, they cease to think calmly. They abandon logical processes, they scorn dispassionate analyses of conditions and probabilities. All about them they behold the faces of gold stricken fellow madmen. They know that a final crash is inevitable, because such...
...periods always lead to disastrous overproduction; but they think the end is so far away, and coming so slowly, that they can prepare for it in time. It is the egotistical delusion of men whom the dazzle of gold has blinded — men who fancy that they are not gambling, but...
...merely making aureate hay while the sun of prosperity shines. It means “boom days” — an era of exaggerated values, of over-stimulated business, of excessive output, which lasts months, possibly even years."
"And then?
The economic pendulum swings back and downward.
It has happened before.
It will happen again.
That is the law."
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