Newton's Madness

What actually happened

Newton was no naif: he was Master of the Royal Mint, the man who had rebuilt England's coinage. His first trade was rational: take the doubling, walk away. What the bubble then attacked wasn't his intellect but his composure: everyone around him kept getting richer for three more months.

He re-entered with size in the summer; the stock collapsed in the autumn. The famous line was first recorded secondhand thirty-six years later, and the episode captions it as attributed: that he 'could calculate the motions of the heavenly bodies, but not the madness of people.'

Modern reconstructions of his accounts (Odlyzko) confirm the shape: early profit, late re-entry, heavy loss.

The play to remember

The bubble doesn't beat your math; it beats your patience. Watching others get rich is the most expensive spectator sport ever invented.