Together, these three historic episodes confirm that greed and fear have always been the driving forces of financial markets, and, furthermore, that being sensible and clever is no defence against the mesmeric allure of a popular craze with the wind behind it.

In writing the history of the great financial manias, Charles Mackay proved himself a master chronicler of social as well as financial history. Blessed with a cast of characters that covered all the vices, gifted a passage of events which was inevitably heading for disaster, and with the benefit of hindsight, he produced a record that is at once a riveting thriller and absorbing historical document. Over a century and a half later, it is as vibrant and lurid as the day it was written.

For modern-day investors, coping with the ups and downs of the stock market the moral of the popular manias scarcely needs spelling out. When the next stock market bubble comes along, as it surely will, you are advised to recall the plight of some of the unfortunates on these pages, and avoid getting dragged under the wheels of the careering bandwagon yourself.

"If you plan to read one book this month, then read this one. If you do not read anything, then start the reading habit with this book . . . although the book does not contain tools and methods for trading, it must be one of the best books for traders." Sudarshan Sukhani

Charles Mackay was born in Perth, Scotland in 1814. His mother died shortly after he was born, whereupon his father, an officer in the Royal Navy, sent Charles to live with a nurse in London.

At the age of sixteen he was employed as the private secretary to William Cockerill, an ironmaster based in Belgium. In his spare time he wrote articles for the local newspaper, then returned to Britain to write for London newspapers, and in 1835 became assistant to George Hogarth on the Morning Chronicle. He was in auspicious company: other journalists on the paper included Charles Dickens and William Hazlitt.

In 1844 he moved from the Morning Chronicle to edit The Glasgow Argus. While there he contributed articles and poetry to the Daily News, a newspaper set up by Charles Dickens. In 1848 he returned to London to join the staff of the London Illustrated News, becoming its editor in 1852.

Other than Extraordinary Popular Delusions and the Madness of Crowds, Mackay publications include an anthology of his poetry, a dictionary of Lowland Scotch, and a two volume autobiography published two years before his death in 1899.