In a post on X (formerly Twitter), Kamath recommended 1929 by journalist Andrew Ross Sorkin as “a must-read for anyone in the markets — stocks, commodities, or crypto.” He quoted US President Herbert Hoover’s remark from that era: “The only problem with capitalism is capitalists. They’re too damn greedy.”
Kamath used the reference to make a larger point — that despite evolving financial instruments, regulations, and asset classes, the market’s emotional DNA remains unchanged. “Every crash, 1907, 1929, 1987, 2001 (Dotcom), 2008 (GFC), and so many more, follows the same script,” he wrote.
According to him, the story always begins the same way: greed drives prices higher, creating bubbles that attract even those who don’t fully grasp the risks. As excitement builds, leverage quietly piles up — through loans, margin trades, or complex derivatives. “It always finds a home,” Kamath noted.
Then, inevitably, comes the reckoning. “One day, the bubble pops,” he said. “The leverage unwinds with unstoppable force, amplifying losses as cascading sell-offs feed on themselves. Markets crash, fortunes evaporate, and the cycle reaches its end.”
Kamath’s reflection captures the psychology that underlies not just historical collapses like the 1929 Wall Street crash or the 2008 financial crisis, but also more recent speculative manias in cryptocurrencies and smallcap stocks.In his view, while each generation of investors believes it is witnessing something new, the pattern rarely changes — only the instruments do. “In the aftermath, lessons are learned,” Kamath wrote. “Regulations target the specific form of leverage that caused the crisis. The mechanism gets fixed, reformed, and contained. But greed never disappears.”That recurring greed, he added, “simply waits, then returns in a new form, finding fresh channels for leverage that no one is watching. And the cycle begins again. Different stories. Same ending.”
Kamath’s post resonates widely among market participants, particularly in a year when global equities have been volatile and speculative pockets in the Indian market — from smallcaps to thematic trades — have drawn regulator warnings.
The Zerodha founder has often spoken about investor behaviour and risk in euphoric phases. His latest reminder — rooted in market history — underscores a timeless truth: while technology and regulation evolve, human nature remains the biggest variable in finance.