This book engages the reader in a fascinating discussion of the role played by fear in financial market panics. Professor Colin Read demonstrates, in easy-to-understand terms, that rising market fear portends to major financial declines. He discusses the science and the economics of fear and shows that the financial market has learned how to capitalize on investor or economic fear. Professor Read devises a measure of fear, called the panic index, and shows how this panic index is closely correlated to market volatility, the decline of returns for small investors and the rising profits in the financial industry. He concludes by offering a series of recommendations that can strengthen financial markets and leave them less prone to manipulation. Throughout the book, readers are provided with the necessary economic tools to enable them to understand the current market turmoil, and the author makes the case for the value of an economically literate society.