The stock market has reached what appears to be a permanently high plateau
- Irving Fisher
Born in 1867 in upstate New York, Irving Fisher always knew he was destined for greatness. Fisher, the son of a Congregationalist minister, carried the moral fiber of New England Puritanism throughout his life. His early years saw him thrive academically at Yale, where he graduated top of his class in 1889. He was even inducted into the prestigious Skull and Bones Society.
Fisher's love for mathematics led him to economics. His Ph.D. dissertation revolutionized the field by pioneering the theory of marginal utility. Paul Samuelson once called his dissertation the best in economics, a testament to Fisher's academic brilliance.
Battle with TB
Fisher’s star was on the rise. But Fisher’s life wasn’t without its trials. In 1898, just as his career was taking off, he was diagnosed with tuberculosis (TB). It was a blow that would change the course of his life. At the time, TB was essentially a death sentence. His father had succumbed to the same illness years earlier. Fisher's doctor couldn't even deliver the news directly, instead telling his wife. Yet Fisher, ever determined, fought to survive.
He spent time in the dry climates of Colorado Springs and Santa Barbara, where he crossed paths with Roger Babson, another TB patient who shared his interest in economics and markets. Both men recovered, but while Fisher remained optimistic about the future, his unwavering positivity was a beacon of hope. Babson became a notorious bear on Wall Street, but Fisher's optimism never wavered
Fisher the Biohacker
Fisher's battle with TB shaped more than just his health—it shaped his outlook on life. He became a fervent advocate for healthy living, devoting himself to the virtues of fresh air, exercise, and a strict diet. A tall, trim figure, Fisher was known for his rigid routine, which included jogging, eating fruit and peanut butter, and avoiding alcohol and tobacco. His zeal also extended into social causes, from Prohibition to eugenics and even 100% reserve banking.
His meticulous nature, however, bordered on eccentricity. For example, when staying in hotels, Fisher personally instructed chefs on how to prepare his meals. He wasn't known for his sense of humor. But by all accounts, he was deeply devoted to his wife Margie, with whom he shared an unshakeable bond. His letters to her, always beginning with "Dearest Love," were filled with affection. Fisher may have been rigid in public life, but his family meant everything to him in private.
Fisher Wants to Be a Millionaire
But it wasn't all work and no play for Fisher. In addition to his academic and reformist pursuits, Fisher had a penchant for invention. In 1910, he created an early version of the Rolodex, an index card system that allowed users to easily file and retrieve information.
Though it took years to catch on, the invention eventually made Fisher a millionaire. His newfound wealth led him to embrace a more lavish lifestyle, complete with a chauffeur-driven Lincoln and high-profile investments in the stock market.
Oracle of Wall Street
By the 1920s, Fisher had cemented his reputation as an economic oracle. Alongside Columbia professor Wesley Mitchell, he became one of the chief proponents of the "New Era" optimism that characterized the Roaring Twenties. He famously predicted that the stock market had reached a "permanently high plateau," a statement that, in hindsight, would become the epitome of ill-fated optimism.
Despite warnings from his old friend Roger Babson, who foresaw the impending crash, Fisher remained bullish. His public feud with Babson in the months leading up to the 1929 crash became legendary. As stock prices wobbled, Fisher insisted they would stabilize. Unfortunately, he couldn’t have been more wrong.
Bankruptcy
The crash of 1929 wiped out nearly 90% of stock values, and Fisher's fortune was no exception. His portfolio, once worth as much as $10 million, was obliterated. Undeterred, Fisher continued to write and lecture, even penning a book in the immediate aftermath of the crash, in which he attempted to maintain his optimistic stance. But the damage was done.
By the early 1930s, Fisher was grappling with bankruptcy. His wife's sister lent him significant sums to keep him afloat, and he faced constant pressure from the IRS over unpaid taxes.
In his later years, Fisher remained a reformer, advising President Franklin D. Roosevelt and championing ideas like deposit insurance. He wrote over thirty economics books, but his finances never recovered. In 1940, Fisher suffered a final blow with the death of his beloved Margie.
LIfe of Ruin
Now widowed and financially ruined, Fisher spent his last years chasing ill-fated schemes, like a collapsible three-legged chair he tried to sell to Sears.
In 1947, he died of cancer, leaving behind a complex legacy—both as one of America's greatest economic thinkers and as a man whose personal miscalculations cost him everything.
Fisher's life poignantly reminds us of the dangers of hubris. His unshakeable belief in the permanence of prosperity blinded him to the very risks he spent his career analyzing.
While his contributions to economics remain vital, his personal story offers a lesson in the perils of overconfidence.