If an investor merely recognizes the way mob sentiment works, the authors point out, he is far ahead of most others. Ordinary people, for example, turn over billions of dollars' worth of their hard-earned money to brokers and mutual fund managers every day -- immediate, tangible, personal money -- believing that strangers will give them back even more. Whatever would make them think so?

Mobs, Messiahs, and Markets demonstrates that investors are in fact caught between a rock and a soft place -- between the private world they can understand and master and the misleading public spectacle of the markets. "The further away you get from your investments, and the less you suffer the consequences if they go bad, the worse your performance will be," say Bonner and Rajiva. "That's why 'collective' investments like index-linked funds, mutual funds, hedge funds, insurance funds, and pension funds are usually so bad. The investors are too far from the facts -- and the managers are too far from the consequences."

The authors' cautionary tale of the current bubble economy warns that the gush of credit let loose by Alan Greenspan is fraught with perils for the unwary -- but their thoughtful and always entertaining approach also offers some sound investing principals for avoiding the pitfalls of the public spectacle, thinking for yourself, and protecting your money, your sanity, and your soul.