Good economist, poor practicality

Good economist, poor practicality

Keynes, Marx, Saint-Simon, and Newton, - not only did these people have an incredible talent and contribution to the development of economic ideas, but also they all were incredibly unlucky in business. The cobbler's children have no shoes. Despite their genius, they couldn’t realize their ideas in practice. Some of them were supported by their colleagues all their life, and some died young in extreme poverty.

Karl Marx, subsidized for the whole life

Karl Marx' name is a well-known one and every student of the economic department studies his great book "Capital". However, the person whom the phrase "Money shall make money" is attributed to could hardly provide for his family in real life, which is almost an unknown fact. Soon after Marx moved to London in 1848, a profound grief befell the family: the younger son died. Marx even had no opportunity to cover funeral expenses. It was Marx' colleague Friedrich Engels who helped him that time and many other times, as he was quite successful in business, unlike Marx. Partner of a textile factory, he earned enough to provide for his own small family and subsidize Karl Marx throughout his whole life.

In real life Karl Marx wasn't as successful as his works

In real life Karl Marx wasn't as successful as his works

It's worth mentioning that Marx' poverty wasn't a result of his insight but of his attitude to paid work. After his works became popular, many editors offered him money for writing articles. To justify his refusal, Marx used to refer to his persistent work on "Capital". Nevertheless, the economist's well-being had improved by the end of his life mostly owing to Engels' subsidies.

John Keynes, victim of an unsuccessful forecast

Economist John Keynes is the author of the General Theory of Employment, Interest and Money, published in 1936. This period marked the highlight of his career: he was recognized as a leader among economists of those times. Just a few years before Keynes had been on the edge of bankruptcy after losing all of his savings during the Great Depression of the years 1929–1933.

Some of Keynes' forecasts were incorrect

A few weeks before the outburst of the first and the wildest American crisis of the 20th century John Keynes had announced that the country's economy was stable and most favourable to risky investments.

Keynes was unaware that economic development is cyclic and a slump inevitably follows a peak, which was the reason of his mistake.

Henri de Saint-Simon with his idea of rational society reconstruction and Pierre-Joseph Proudhon with Philosophy of Poverty also joined the ranks of unsuccessful economists. Both scientists died in misery.

Isaac Newton and the South Sea Company

The first-ever financial pyramid organized by Robert Harley in 1711 draw worldwide famous physicist Isaac Newton's attention. The South Sea Company was said to have a monopoly to trade with the Spanish sector of South America, but in reality it had never conducted any operations before 1717. Still, the company's stock was being actively sold during that period and the investors received profits at the expense of newcomer investors.

In 1720 Newton predicted that the company would possibly crash soon and therefore withdrew his investment, managing to earn 7,000 pounds. However, the popularity of the company's stock continued to grow and the cost amounted to 1,000 pounds per share. Despite his own words, Newton submitted to the general hysteria and bought a package of shares again. In the end, the company's bank announced bankruptcy in 1720 and Newton lost over 20,000 pounds. At that very moment he pronounced the famous phrase: "I can calculate the motion of heavenly bodies, but not the madness of people".