I recently found out about Peter L. Bernstein (1919-2009), a popular American economist and financial historian. I must confess I haven’t read any of his books, but will surely read them after having learned from his life.
A son of a financial consultant, Bernstein attended Harvard College, where he befriended Robert Heilbroner (famous historian of economic thought) and earned a B. A. in Economics. He worked at the Federal Reserve Bank and joined the Air Force during the Second World War. In 1951, he became the manager of Bernstein-Macauley, Inc., the wealth management firm of his late father. In 1973 Bernstein would start his own firm, Peter L. Bernstein Inc., and in 1974 he became the first editor of the Journal of Portfolio Management.
Bernstein wrote ten books on economic and financial matters. He was known for presenting topics of risk management, asset allocation, portfolio strategy and financial markets history to a broad audience. This is remarkable, for in my view economic historians should aim to write for not only for academic circles but also for a public unaware of the insights brought by our discipline.
Among Bernstein’s most notable works are Capital Ideas: The Improbable Origins of Modern Wall Street (Maxwell Macmillan, 1992) and Against The Gods: The Remarkable Story of Risk (John Wiley & Sons, 1996). Bernstein wrote a follow-up to his 1992 book, Capital Ideas Evolving (John Wiley and Sons, 2007).
His works truly profit from Bernstein’s expertise as an insider in the financial industry. In 2004, Money magazine said that Bernstein “has probably learned more about more aspects of investing than anyone else alive”. His books were widely read in top financial circles.
Here is Peter L. Bernstein’s last essay, “The Moral Hazard Economy“, published by Harvard Business Review on its July-August 2009 number. You can read here “The New Religion of Risk Management“, an essay with the core ideas of his book Against the Gods. Julia Kirby, an editor of Harvard Business Review, mentions an interesting point of view held by Bernstein:
Which way things would go was hard to predict, he wrote, because “much about this current crisis is unprecedented, which means that history is less relevant than it has been, well, historically.”
Sadly, he will not elaborate on that anymore. But his works remain, and will surely be a reference when the history of the crisis of 2008 is written.