Thursday, December 24, 2015

Hallelujah: "Why Handel Never Went Baroque"

From Jason Zweig at the now departed WSJ Total Return blog, Dec. 3, 2012 as mirrored at Mr. Zweig's personal site:
This Christmas season, before we head off to any performances of the Messiah by George Frideric Handel  (1685-1759), Total Return wants to note that the great composer was a successful investor.
In a wonderful article published in 2004, MIT music professor Ellen Harris documents Handel’s financial shrewdness.

By the end of his life, according to several contemporary sources, Handel was worth at least 20,000 pounds, or 2.39 million pounds in today’s money.

His musical career was lucrative, despite occasional setbacks, but Handel supplemented his income with opportunistic investments.

Like many other intellectuals living in London at the time, including Alexander Pope and Isaac Newton, Handel bought into the South Sea Co., the investment that was at the center of one of the world’s earliest and most devastating financial manias.

Unlike most of his peers, however, Handel got in early — and got out early as well. According to Harris, he bought no later than 1716, long before the price ran up, and appears to have sold by the middle of 1719, at least one year before the bubble burst.

And once Handel got out, he stayed out; he didn’t re-enter the stock market until 1728, long after the mania had faded.

Harris estimates that Handel roughly doubled his money on his South Sea bet, locking in a profit of approximately 15,000 pounds in today’s terms.

What led the great composer to bail out of the bubble just as so many investors were desperately piling in? Was he just lucky? Did he need quick cash for a temporary spending need? Could the firmly disciplined musician been uncomfortable singing the same tune as every other investor? Harris doesn’t speculate, and we will probably never know....MORE
Since Mr. Zweig posted this article MIT has made Professor Harris' paper open access, here.

Finally, here's a do-it-yourself part of the big piece done at a small college in Japan. Sensei Jiro Tomonaga, music director: