Financial-Nonsense Blamed on Philosophers
Ethan Everett, The Investment Philosophers: Financial Lessons from the Great Thinkers (New York: Columbia Business School Publishing, October 2025). Hardcover: $28. 170pp. ISBN: 978-0-231221-11-5.
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“What do Warren Buffett and Friedrich Nietzsche have in common? Why does Baruch Spinoza’s understanding of irrational emotions help explain financial markets? How did Voltaire’s success in a bond lottery arbitrage shape his writing? Can David Hume teach an investor when to buck the consensus and when to heed it? Exploring these questions and many others, Ethan A. Everett reveals the surprising lessons we can learn about investing from major philosophers. Demystifying ideas and texts that can often seem intimidating or irrelevant, he shows how philosophical concepts can be fruitfully applied to financial markets. Everett shares how philosophers’ insights have informed his development as an investor, and he considers how great investors have embodied philosophical wisdom in their own endeavors… Ranging from the birth of modern securities markets in seventeenth-century Amsterdam to recent trends like meme stocks, this book shows why a philosophical perspective can prove invaluable to challenging common assumptions in finance.”
This book is divided into parts by themes: markets-and-morality, profiting from skepticism, market abstraction and investor identity, “money mindsets and market meaning”, and “market adaptation”. The first couple of these are reasonably clear, but the others are too abstract to grasp how these ideas can be connecting for an entire part. Madoff-rejection is a chapter in the last section on “adaptation”. Why would rejecting a Ponzi-scheme be a form of adaptation? The editor should have applied clearer part-titles to guide the reader.
The “Introduction” explains that teachers of investing, such as Benjamin Graham, regularly use philosophical quotes, as from Baruch Spinoza, to explain their financial advice. However, the first example offered shows how this philosophy is used to confuse, instead of guiding. Graham claims a “proper psychological attitude” is needed for investing before quoting from Spinoza on “eternity”. Eternity is a theological concept, not a psychological one. But what student would have been daring enough to raise their hand and object that Graham’s allusion was irrelevant? The following clarifying remarks are very convoluted as they seem to be stating that “common-people” cannot grasp philosophy, and that’s why financial-lecturers can use such quotes to mislead or confuse them into compliance with their will, without understanding.
“Chapter One: Going Short Irrational Emotions” finally arrives at some kind of useful philosophical-financial analysis. It opens with the note that in 1637 “the largest public company in history… the Dutch East India Company…” reached “an inflation-adjusted market value of” around $7.5 trillion”. My research in my BRRAM series into Renaissance’s market-manipulations by Richard Verstegan (probably a Jew (though advertised Catholic), who lived in the Netherlands, and was paid to write propaganda for the Dutch colonialists, among others) and other ghostwriters explains how this enormous wealth was acquired. I had not calculated this was the sum their wealth amounted to before, so this is an interesting and useful intro. The author explains that almost exclusively Jews initially invested in the Company, but their share dwindled by the end of this entity’s lifespan. Rabbi Menasseh puffed the Company in his theological Jewish texts, and he had taught Spinoza philosophy. While this is a dramatic intro, what follows is vague quotes from Spinoza that never mention the Company, or make direct financial advice. Spinoza was vague in his philosophy, instead of explaining financial concepts directly because his research was obviously sponsored by the Company. Spinoza’s argument against emotions is introduced: that argues that people make decisions that go against their self-interest because their emotions intervene. Then, the author introduces a first-person account of his own financial experience. He notes that he had raised a question about if Herbalife was a Ponzi scheme before realizing: “I had been emotionally comforted by the idea that laws in the US were almost always duly enforced, especially in the case of emotionally charged subjects, such as a big corporation defrauding vulnerable people”. The following paragraph starts with a contradiction that the “law is not something magical” (15-6). This epiphany is not helpful in explaining either Herbalife or Spinoza’s theory. The chapter(s) conclude with “Key Investment Takeaways”. These are generalities such as that “market actors will often take actions that do not further their original ends” (17). This is not helpful because most actors do take actions that are in their financial interests, so this is not rationally applicable to situations an analyst would need to practically analyze.
While I was briefly inspired by parts of this book; overall, I do not recommend anybody to try to read it because it is likely to convince them both philosophy and finance are nonsensical. Only poorly written social science is nonsensical, and this book is an example of this category.
--Pennsylvania Literary Journal: https://anaphoraliterary.com/journals/plj/plj-excerpts/book-reviews-summer-2025/

Practitioners and researchers in the Investment Management field have a long history of exploring any insight or theory that might give them the ability to increase the value of their portfolio positions. Beyond natural forays into processing financial data in new and creative ways, the quest for any investment advantage possible has also led to mining entirely separate fields—such as evolutionary biology, management science, fractal analysis, and even gambling strategy—for notions of how the portfolio formation process might be improved. Easily the best example of how applying ideas from a different field of study has advanced our understanding of investing was the integration of findings from experimental psychology, which resulted in the creation of a widely recognized subfield (i.e., behavioral finance) in addition to several winners of the Nobel Prize in Economic Sciences (e.g., Daniel Kahneman, Robert Shiller, Richard Thaler).

So, it was perhaps inevitable that someone would try to connect the study of investing to other intellectual disciplines as well. In The Investment Philosophers, author Ethan Everett attempts to do just that, this time examining what the ideas espoused by several of the great philosophers from the ages might teach us about how our investment capital can be better deployed. In a brief introduction suggesting why there might be any meaningful connection between investment management and formal philosophical structures—a discussion that includes a nice homage to Michael Mauboussin’s More Than You Know, which investigated the broad topic of how investing is entwined with other fields of study about two decades ago—Everett poses the main question that motivates the book: What do the great investors have in common with the great philosophers and what has prevented other market participants from considering what philosophy has to offer?

The main text contains thirteen chapters, all of which follow a similar construction. The relevant work of a notable philosopher is explained in the context of modern financial market behavior and then the author attempts to connect those concepts to some aspect of the modern investment process. Insights from an impressive array of philosophers are covered, including Voltaire, Spinoza, Nietzsche, Hume, Kierkegaard, Pascal, Schopenhauer, James, Baudrillard, Camus, and even Bruce Lee (!!). The work of each of these thinkers is then related to a different investment concept, such as investor attitudes toward wealth accumulation, contrarian investment strategies, characteristic portfolio formation, perceptions of other market participants, investing with a flexible approach, and so on. Generally, Everett does a nice job of translating often daunting philosophical concepts into practical lessons, bridging the gap between abstract theory and real-world application. In fact, his summaries of these myriad philosophical insights represent the book’s chief strength.

Unfortunately, where The Investment Philosophers falls short is in making compelling connections between the highlighted philosophical snippets and the actual practice of investing. Of course, this is not a trivial shortcoming since establishing those ties was the essential point of the book. Two examples of where the analogy between philosophical doctrine and investment principles seems either stretched or forced are the attempt to extend Spinoza’s concept of eternity to how investors should look at financial markets and relating Nietzsche’s concept of “eternal recurrence” to how Buffett thinks of a corporation’s business culture. Dubious connections such as those often led to “investment takeaways” that are vague to the point of being useless in practice (e.g., “We can strengthen our investment processes by continuously reflecting on our emotions and assessing whether they are irrational”, or “While the process of abstraction can be highly useful, we should be careful that our abstractions do become so detached from reality that they have highly destructive real-world consequences”). Finally, including Bruce Lee’s martial arts musings alongside the work of such luminaries as Kierkegaard, James, and Schopenhauer was the most disconsonant stretch yet.

Overall, I had very mixed feelings when reading this book. I certainly admire the ambitious attempt on the part of the author to examine two very different areas of intellectual activity for any similarities they might contain. Also, while not a lengthy treatment by any means, the analysis was impressive for its scope. However, the author failed to make a sound argument for why studying bits and pieces of philosophical work from well in the past creates truly useful and actionable information for investors in today’s market. Unlike how the adoption of stochastic mathematics helped to value derivative securities or experimental psychology findings identified investor heuristic biases that can lead to market inefficiencies, the problem with this project is that it approaches things backwards, effectively starting with observations of what participants in financial markets are currently doing and then searching for a philosophical treatise that might be related somehow. The reversed nature of that construction process is ultimately what leads to many of the connections to seem so forced and unconvincing. Consequently, while I can recommend The Investment Philosophers to certain readers of the investing literature, that recommendation does come with some significant qualifications.