Given what we now know about the effects of finance economics models on the markets – that they create portfolios that mimic each other – Keynes' observations in his General Theory on Americans and how they invest seems strangely prophetic:

"Even outside the field of finance, Americans are apt to be unduly interested in discovering what average opinion believes average opinion to be; and this national weakness finds its nemesis in the stock market. It is rare, one is told, for an American to invest, as many Englishmen still do, 'for income'; and he will not readily purchase an investment except in the hope of capital appreciation. This is only another way of saying that, when he purchases an investment, the American is attaching his hopes, not so much to its prospective yield, as to a favourable change in the conventional basis of valuation, i.e., that he is ... a speculator." Source: John Maynard Keynes, The General Theory of Employment, Interest and Money (photo. reprint 1997) (New York: Harcourt, Brace & World, 1936), p. 159.

Whether in stocks or real estate, we Americans speculate. The Securities Acts and other finance legislation of the 1930s sought the transformation of the markets from places of speculation – like racetracks or casinos – to places of informed investment.

Under Presidents Reagan through Bush II, the dismantling of New Deal legislation and the gelding of the regulatory agencies meant to implement it marked the triumph of culture over experience, of impulse over deliberation.

Two years ago, The Economist opined:

"Instead of saying that those who cannot remember the past are condemned to repeat it, George Santayana might have better said that those who misinterpret the past are condemned to bungle the present." Source: "An Affair to Remember," Economist, July 29, 2006, p. 25.

What Santayana actually said is far more disturbing:

"Progress, far from consisting in change, depends on retentiveness.... Those who cannot remember the past are condemned to fulfill it." Source: quoted in J.S. Gordon, "The Freedman's Bank," American Heritage, December 1993, pp. 18, 20.

For Americans, culture seems to be destiny. We are fulfilling the past, the past of the 1920s, because we could not retain the lessons of the 1930s.