Economia Politica

, Volume 35, Issue 1, pp 13–40 | Cite as

Taming the great depression: Keynes’s personal investments in the US stock market, 1931–1939

  • Carlo Cristiano
  • Maria Cristina Marcuzzo
  • Eleonora Sanfilippo


While the recent literature has shown an increasing interest in Keynes’s investment activity, specific analysis of his own (rather than for King’s College) investments in US securities is still lacking. Keynes began to trade in the US stock market on a regular basis in late 1931, when it was still very hard to tell when full recovery could be expected. In 1930, he had publicly rebutted the view of his business partner Oswald Falk, whose advice to investors was to abandon British manufacture and buy American shares. Until 1933, Keynes’s outlook on the USA remained negative. Only in February 1934 did Keynes become optimistic about the USA on account of his growing confidence in the New Deal, which however was short-lived. In 1937 he was shaken by the US recession and disillusioned by Roosevelt’s fiscal policies and reforms. In this paper we first trace the evolution of Keynes’s opinions on the US economy and his “view” on the US stock market. There are direct references to Wall Street and specific examples relating to its working that are contained, in particular, in Chapter 12 of the General Theory. We then go on to follow the timeline of his investments by sectors, focusing on the companies that Keynes held onto for a longer period, looking for a pattern in his investment behaviour in the US market between 1931 and 1939, before the War changed the personal and institutional circumstances of his investment activity. We offer also a comparison of Keynes’s own portfolio with his investments on behalf of King’s (as reconstructed by Chambers and Kabiri, Bus Hist Rev 90(Summer):301–328, 2016) and conclude with an assessment of the influence of his theoretical approach on his investment activity.


Keynes Investment Equities Wall Street Financial markets 

JEL Classification

B26 B31 G11 N22 



We wish to thank Jan Kregel for helpful comments on an earlier version. We are also extremely grateful to Iolanda Sanfilippo for her invaluable research assistance.


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Copyright information

© Springer International Publishing AG 2017

Authors and Affiliations

  1. 1.Dipartimento di GiurisprudenzaUniversità di PisaPisaItaly
  2. 2.Dipartimento di Scienze StatisticheUniversità di Roma, La SapienzaRomaItaly
  3. 3.Dipartmento di Economia e GiurisprudenzaUniversità di Cassino e del Lazio MeridionaleCassinoItaly

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