Five best books on financial meltdowns

For the Wall Street Journal, Martin Mayer, a guest scholar in economic studies at the Brookings Institution and the author of many books about banking and finance, named a five best list of book on financial meltdowns.

Number One on his list:

Manias, Panics, and Crashes
by Charles P. Kindleberger
Basic Books, 1978

Charles P. Kindleberger's "Manias, Panics, and Crashes" is the definitive overview of financial emergencies. It was published 30 years ago but updated early in this decade (when Charlie was 90 years old!). A professor of economics at MIT and one of the designers of the Marshall Plan after World War II, Kindleberger practiced what he cheerfully called "literary economics," as distinguished from the mathematical or even statistical economics to which almost all his colleagues paid obeisance. The style of the book is conversational, but it is not merely a narrative; its many historical illustrations serve analytical purposes. In the chapter "Speculative Manias," for instance, Kindleberger considers the surge of gold prices in the 1970s, when gold spiked from less than $40 an ounce at the start of the decade to $200 by 1973. "The greater fool theory" was likely at work, Kindleberger says, as some buyers -- aware that they were buying into a bubble -- acquired gold intending to unload it before the bubble burst. The reader will find in these pages from a generation ago all the arguments being aired regarding the current economic mess. With typical grace and brevity, Kindleberger addresses a subject now much on our minds: "Given a seizure of credit in the system," he writes, "more is safer than less. The excess can be mopped up later. As for timing, it is an art. That says nothing -- and everything."

Read about all five titles.

Related: Critic's chart: books on cash crashes.

--Marshal Zeringue