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Toolbox | Chris Farrell's Favorites | The Economy
Against the Gods
by Peter Bernstein (John Wiley & Sons, August 1998)
Perhaps the most important finance book of the 1990s. "What is it that distinguishes the thousands of years of history from what we think are modern times? The answer goes way beyond the progress of science, technology, capitalism, and democracy. The revolutionary idea that defines the boundary between modern times and the past is the mastery of risk: the notion that the future is more than the whim of the gods and that men and women are not passive before nature." An engrossing history of risk, gambling, probability, and financial markets.
Buffet: The Making of an American Capitalist
by Roger Lowenstein (Doubleday, September 1996)
His biography of Warren Buffett is a solid, immensely readable look at the Wizard from Omaha.
Capital Ideas
by Peter Bernstein (Touchstone Books, May 1993)
Ideas do matter. A superb introduction to the revolution in finance that has transformed the world over the past half-century. A revolution fomented in the halls, offices, and computers of academia. A nice mix of character profile and intellectual history.
The Coming Internet Depression
by Michael Mandel (Basic Books, October 2000)
The chief economist at Business Week, Mandel has long followed the new economy. This was a prescient look at a high-tech boom that went on for too long.
Crashes and Panics: The Lessons of History
by Eugene White (Irwin Professional Publishers, June 1990)
A very academic collection of essays. These research papers, which range from Tulipmania in 17th century Holland to the Great Crashes of 1929 and 1987, are all, by top-notch scholars.
The Death of the Banker: The Decline and Fall of the Great Financial Dynasties and the Triumph of the Small Investor
by Ron Chernow (Vintage Books, July 1997)
Frankly, anything Chernow writes is worth reading, especially his history of the Morgan dynasty. Anyway, this short book pulls together several major ideas that have evolved from many years of studying the history of finance.
Devil Take the Hindmost: A History of Financial Speculation
by Edward Chancellor (Plume, June 2000)
He's done a nice job retelling some of the most famous speculative bubbles in history.
Dot.con: The Greatest Story Ever Sold
by John Cassidy (HarperCollins, March 2002)
The finance and economics writer for the New Yorker takes a wonderfully jaundiced look at the 1990s.
Economic Report of the President
by the Council of Economic Advisors (Claitor's Law Books and Publishing, February 2003)
This annual report written, by some of the nation's best economists is a gold mine of analysis and information. This is the place to begin if you want a well-written summary of what economists know about trends in inequality, productivity, inflation, regulations, growth, and so on.
The Great 401(k) Hoax: What You Need to Know to Protect Your Family and Your Future
by William Wolman and Anne Colamosca (Perseus Publishing, May 2002)
Bill is brilliant, an incredibly creative economist. Formerly Business Week's chief economist, he and Leonard Silk brought high-powered economics into journalism in the 1960s. A gloomy look at the economy and retirement savings.
Globalization and its Discontents
by Joseph Stiglitz (W.W. Norton & Company, June 2002)
The book falls apart toward the end, but Stiglitz, one of the world's foremost economists, is an articulate voice against the more simplistic versions singing the praises of global capitalism.
The Hedgehog and the Fox: An Essay on Tolstoy's View of History
by Sir Isaiah Berlin (Ivan R. Dee, Inc.; Reprint, March 1993)
In this essay, the recently deceased British philosopher beautifully spins out an argument based on a line, by the Greek poet Archilochus, "The fox knows many things, but the hedgehog one big thing." It is a sentence that Berlin believes marks one of the great divides in intellectual life. "For there exists a great chasm between those, on the one side," he writes, "who relate everything to a single central vision, one system less or more coherent or articulate. And, on the other side, those who pursue many ends often unrelated and even contradictory, connected, if at all, only in some de facto way. The first kind of intellectual and artistic personality belongs to the hedgehogs, the second to the foxes." Well, investing is a world that attracts a lot of hedgehogs — and they typically charge a hefty fee. Yet investing is an activity for philosophical relativists. A related essay is "The Pursuit of the Ideal" in his collected essays, The Crooked Timber of Humanity.
High Risk Society
by Michael Mandel (Times Books, January 1996)
The same forces that are driving living standards higher are also behind the rise in job insecurity. Pain and prosperity, growth and uncertainty are linked to one another over the long haul.
A History of Interest Rates
by Sidney Homer and Richard Sylla (Rutgers University Press, July 1991)
The late Sidney Homer was a Wall Street pioneer in bond market research. Richard Sylla is an economic historian at New York University. by design, the book is relatively light on economic analysis, but it is incredibly detailed and rich in recording interest rate trends through the ages. How can you not like a book with a first chapter that begins like this: "In historical times credit preceded the coining of money, by over two thousand years. Coinage is dated from the first millennium B.C., but old Sumerian documents, circa 3000 B.C., reveal a systematic use of credit based on loans of grain, by volume and loans of metal, by weight. Often these loans carried interest."
"Inflation and Deflation"
by John Maynard Keynes in Essays in Persuasion (W.W. Norton & Company, September 1991)
A brilliant economic and social discourse on the dangers of both rising prices and falling prices. Keynes knew both. A powerful argument for price stability — far better than any of the dry recitations and incantations of today's central bankers.
Irrational Exuberance
by Robert Shiller (Princeton University Press, March 2000)
A professor of economics at Yale University, Shiller has written a thoughtful book that make the best case yet that the stock market is a bubble of unprecedented proportions in U.S. history.
It Was a Very Good Year: Extraordinary Moments in Stock Market History
by Martin Fridson (John Wiley & Sons, December 1997)
A readable history of extraordinary moments in the stock market, starting in 1908.
The Lexus and the Olive Tree: Understanding Globalization
by Thomas Friedman (Anchor Books, May 2000)
Just what is globalism, that abstruse, abstract set of developments now worrying everyone from politicians to executives to plant-floor leaders? The peripatetic foreign-affairs columnist of The New York Times applauds the triumph of global capitalism but he also recognizes the growing pains and human costs that globalization creates.
Macro-Markets: Creating Institutions for Managing Society's Largest Economic Risks
by Robert Shiller (Clarendon Pr, June 1998)
A short, but extremely technical book with plenty of equations. Yet the introduction and the first chapter are accessible and well worth reading for many people. I especially like his discussion of risk and gambling. The basic idea behind this book in breathtakingly bold — to create markets that would allow people to hedge against all kinds of risks to their living standards.
Manias, Panics, and Crashes: A History of Financial Crises
by Charles Kindleberger (John Wiley & Sons; 4th edition, November 2000)
The classic work on financial crisis and speculative disasters. Opens with a quote from Walter Bagehot, the 19th century British thinker that nicely captures Kindleberger's subject. "Much has been written about panics and manias, much more than with the most outstretched intellect we are able to follow or conceive; but one thing is certain, that at particular times a great deal of stupid people have a great deal of stupid money. At intervals, from causes which are not to the present purpose, the money of these people — the blind capital as we call it, of the country — is particularly large and craving; it seeks for someone to devour it, and there is a 'plethora'; it finds someone, and there is 'speculation'; it is devoured, and there is 'panic.'"
Money Mischief: Episodes in Monetary History
by Milton Friedman (Harvest Books; reprint, March 1994)
The dean of monetarism in the U.S. This popular book takes you through various episodes in money history. Friedman is lucid and states his analysis with force.
The Money Wars: The Rise and Fall of the Great Buyout Boom of the 1980s
by Roy C. Smith (Beard Group, May 2000)
A former partner at the investment banking firm of Goldman Sachs, and now a professor at New York University. He takes a long look at the history of mergers and acquisitions in the U.S. He asks a very basic question: Are takeovers good or bad? The answer: Yes, on balance. He develops his theme partly in response to questions asked, by his friend Ruth, who is deeply offended, by the excesses of the 1980s.
The New Financial Order: Risk in the 21st Century
by Robert Shiller (Princeton University Press, April 2003)
In this new work, the author of Irrational Exuberance talks about the power of risk management. He says there are better methods of wealth creation out there than the stock market — methods that are a lot less risky and more beneficial to society.
A Piece of the Action: How the Middle Class Joined the Money Class
by Joseph Nocera (Touchstone Books, November 1995)
Finance has gone from being a world of elite's to a middle class mass market. Nocera documents this remarkable transformation in the U.S. I especially enjoyed the discussion of credit cards.
Searching for a Corporate Savior: The Irrational Quest for Charismatic CEOs
by Rakesh Khurana (Princeton University Press, September 2002)
The assistant professor at Harvard Business School wrote a timely analysis of the cult of the American CEO — and why it went too far.
Short History of Financial Euphoria
by John Kenneth Galbraith (Penguin USA; reprint, July 1994)
A truly gifted writer and wry observer, Galbraith's short excursion through the madness of financial crowds is a delight.
Valuing Wall Street: Protecting Wealth in Turbulent Markets
by Andrew Smithers and Stephen Wright (McGraw-Hill, March 2000)
The authors largely focus on why they thought the market of the 1990s was overvalued, but it also has a lot of good information for investors.
Wealth and Democracy: A Political History of the American Rich
by Kevin Phillips (Broadway Books, April 2003)
Considering the corporate accounting scandals and the egregious money grab, by the nation's CEOs in recent years, this book couldn't be timelier.
Wealth & Poverty (ICS Series in Self-Governance)
by George Gilder (Institute for Contemporary Studies; 2nd edition, June 1993)
First published in 1981, this book was closely associated with Ronald Reagan's rise to power. Skip over the social stuff. But if you start with the chapter called "The Inflationary State" and go on from there, Gilder has penned some remarkably insightful chapters on economic growth, inflation, productivity, and innovation.
Why Economies Grow: The Forces That Shape Prosperity and How We Can Get Them Working Again
by Jeff Madrick (Basic Books, October 2002)
The editor of Challenge Magazine is thoughtful about the wellsprings of economic growth, and puts forward a program of action.
Who's Afraid of Adam Smith: How the Market Got Its Soul
by Peter Dougherty (John Wiley & Sons, August 2002)
The leading economics book editor housed at Princeton University Press has written a labor of love about economics, economists, and the good society.
Chris Farrell's Top 12 >>
Favorite books on investing >>
Favorite books on personal finance >>
Favorite books on broad trends and economic analysis >>
Favorite Web sites >>
by Peter Bernstein (John Wiley & Sons, August 1998)
Perhaps the most important finance book of the 1990s. "What is it that distinguishes the thousands of years of history from what we think are modern times? The answer goes way beyond the progress of science, technology, capitalism, and democracy. The revolutionary idea that defines the boundary between modern times and the past is the mastery of risk: the notion that the future is more than the whim of the gods and that men and women are not passive before nature." An engrossing history of risk, gambling, probability, and financial markets.
Buffet: The Making of an American Capitalist
by Roger Lowenstein (Doubleday, September 1996)
His biography of Warren Buffett is a solid, immensely readable look at the Wizard from Omaha.
Capital Ideas
by Peter Bernstein (Touchstone Books, May 1993)
Ideas do matter. A superb introduction to the revolution in finance that has transformed the world over the past half-century. A revolution fomented in the halls, offices, and computers of academia. A nice mix of character profile and intellectual history.
The Coming Internet Depression
by Michael Mandel (Basic Books, October 2000)
The chief economist at Business Week, Mandel has long followed the new economy. This was a prescient look at a high-tech boom that went on for too long.
Crashes and Panics: The Lessons of History
by Eugene White (Irwin Professional Publishers, June 1990)
A very academic collection of essays. These research papers, which range from Tulipmania in 17th century Holland to the Great Crashes of 1929 and 1987, are all, by top-notch scholars.
The Death of the Banker: The Decline and Fall of the Great Financial Dynasties and the Triumph of the Small Investor
by Ron Chernow (Vintage Books, July 1997)
Frankly, anything Chernow writes is worth reading, especially his history of the Morgan dynasty. Anyway, this short book pulls together several major ideas that have evolved from many years of studying the history of finance.
Devil Take the Hindmost: A History of Financial Speculation
by Edward Chancellor (Plume, June 2000)
He's done a nice job retelling some of the most famous speculative bubbles in history.
Dot.con: The Greatest Story Ever Sold
by John Cassidy (HarperCollins, March 2002)
The finance and economics writer for the New Yorker takes a wonderfully jaundiced look at the 1990s.
Economic Report of the President
by the Council of Economic Advisors (Claitor's Law Books and Publishing, February 2003)
This annual report written, by some of the nation's best economists is a gold mine of analysis and information. This is the place to begin if you want a well-written summary of what economists know about trends in inequality, productivity, inflation, regulations, growth, and so on.
The Great 401(k) Hoax: What You Need to Know to Protect Your Family and Your Future
by William Wolman and Anne Colamosca (Perseus Publishing, May 2002)
Bill is brilliant, an incredibly creative economist. Formerly Business Week's chief economist, he and Leonard Silk brought high-powered economics into journalism in the 1960s. A gloomy look at the economy and retirement savings.
Globalization and its Discontents
by Joseph Stiglitz (W.W. Norton & Company, June 2002)
The book falls apart toward the end, but Stiglitz, one of the world's foremost economists, is an articulate voice against the more simplistic versions singing the praises of global capitalism.
The Hedgehog and the Fox: An Essay on Tolstoy's View of History
by Sir Isaiah Berlin (Ivan R. Dee, Inc.; Reprint, March 1993)
In this essay, the recently deceased British philosopher beautifully spins out an argument based on a line, by the Greek poet Archilochus, "The fox knows many things, but the hedgehog one big thing." It is a sentence that Berlin believes marks one of the great divides in intellectual life. "For there exists a great chasm between those, on the one side," he writes, "who relate everything to a single central vision, one system less or more coherent or articulate. And, on the other side, those who pursue many ends often unrelated and even contradictory, connected, if at all, only in some de facto way. The first kind of intellectual and artistic personality belongs to the hedgehogs, the second to the foxes." Well, investing is a world that attracts a lot of hedgehogs — and they typically charge a hefty fee. Yet investing is an activity for philosophical relativists. A related essay is "The Pursuit of the Ideal" in his collected essays, The Crooked Timber of Humanity.
High Risk Society
by Michael Mandel (Times Books, January 1996)
The same forces that are driving living standards higher are also behind the rise in job insecurity. Pain and prosperity, growth and uncertainty are linked to one another over the long haul.
A History of Interest Rates
by Sidney Homer and Richard Sylla (Rutgers University Press, July 1991)
The late Sidney Homer was a Wall Street pioneer in bond market research. Richard Sylla is an economic historian at New York University. by design, the book is relatively light on economic analysis, but it is incredibly detailed and rich in recording interest rate trends through the ages. How can you not like a book with a first chapter that begins like this: "In historical times credit preceded the coining of money, by over two thousand years. Coinage is dated from the first millennium B.C., but old Sumerian documents, circa 3000 B.C., reveal a systematic use of credit based on loans of grain, by volume and loans of metal, by weight. Often these loans carried interest."
"Inflation and Deflation"
by John Maynard Keynes in Essays in Persuasion (W.W. Norton & Company, September 1991)
A brilliant economic and social discourse on the dangers of both rising prices and falling prices. Keynes knew both. A powerful argument for price stability — far better than any of the dry recitations and incantations of today's central bankers.
Irrational Exuberance
by Robert Shiller (Princeton University Press, March 2000)
A professor of economics at Yale University, Shiller has written a thoughtful book that make the best case yet that the stock market is a bubble of unprecedented proportions in U.S. history.
It Was a Very Good Year: Extraordinary Moments in Stock Market History
by Martin Fridson (John Wiley & Sons, December 1997)
A readable history of extraordinary moments in the stock market, starting in 1908.
The Lexus and the Olive Tree: Understanding Globalization
by Thomas Friedman (Anchor Books, May 2000)
Just what is globalism, that abstruse, abstract set of developments now worrying everyone from politicians to executives to plant-floor leaders? The peripatetic foreign-affairs columnist of The New York Times applauds the triumph of global capitalism but he also recognizes the growing pains and human costs that globalization creates.
Macro-Markets: Creating Institutions for Managing Society's Largest Economic Risks
by Robert Shiller (Clarendon Pr, June 1998)
A short, but extremely technical book with plenty of equations. Yet the introduction and the first chapter are accessible and well worth reading for many people. I especially like his discussion of risk and gambling. The basic idea behind this book in breathtakingly bold — to create markets that would allow people to hedge against all kinds of risks to their living standards.
Manias, Panics, and Crashes: A History of Financial Crises
by Charles Kindleberger (John Wiley & Sons; 4th edition, November 2000)
The classic work on financial crisis and speculative disasters. Opens with a quote from Walter Bagehot, the 19th century British thinker that nicely captures Kindleberger's subject. "Much has been written about panics and manias, much more than with the most outstretched intellect we are able to follow or conceive; but one thing is certain, that at particular times a great deal of stupid people have a great deal of stupid money. At intervals, from causes which are not to the present purpose, the money of these people — the blind capital as we call it, of the country — is particularly large and craving; it seeks for someone to devour it, and there is a 'plethora'; it finds someone, and there is 'speculation'; it is devoured, and there is 'panic.'"
Money Mischief: Episodes in Monetary History
by Milton Friedman (Harvest Books; reprint, March 1994)
The dean of monetarism in the U.S. This popular book takes you through various episodes in money history. Friedman is lucid and states his analysis with force.
The Money Wars: The Rise and Fall of the Great Buyout Boom of the 1980s
by Roy C. Smith (Beard Group, May 2000)
A former partner at the investment banking firm of Goldman Sachs, and now a professor at New York University. He takes a long look at the history of mergers and acquisitions in the U.S. He asks a very basic question: Are takeovers good or bad? The answer: Yes, on balance. He develops his theme partly in response to questions asked, by his friend Ruth, who is deeply offended, by the excesses of the 1980s.
The New Financial Order: Risk in the 21st Century
by Robert Shiller (Princeton University Press, April 2003)
In this new work, the author of Irrational Exuberance talks about the power of risk management. He says there are better methods of wealth creation out there than the stock market — methods that are a lot less risky and more beneficial to society.
A Piece of the Action: How the Middle Class Joined the Money Class
by Joseph Nocera (Touchstone Books, November 1995)
Finance has gone from being a world of elite's to a middle class mass market. Nocera documents this remarkable transformation in the U.S. I especially enjoyed the discussion of credit cards.
Searching for a Corporate Savior: The Irrational Quest for Charismatic CEOs
by Rakesh Khurana (Princeton University Press, September 2002)
The assistant professor at Harvard Business School wrote a timely analysis of the cult of the American CEO — and why it went too far.
Short History of Financial Euphoria
by John Kenneth Galbraith (Penguin USA; reprint, July 1994)
A truly gifted writer and wry observer, Galbraith's short excursion through the madness of financial crowds is a delight.
Valuing Wall Street: Protecting Wealth in Turbulent Markets
by Andrew Smithers and Stephen Wright (McGraw-Hill, March 2000)
The authors largely focus on why they thought the market of the 1990s was overvalued, but it also has a lot of good information for investors.
Wealth and Democracy: A Political History of the American Rich
by Kevin Phillips (Broadway Books, April 2003)
Considering the corporate accounting scandals and the egregious money grab, by the nation's CEOs in recent years, this book couldn't be timelier.
Wealth & Poverty (ICS Series in Self-Governance)
by George Gilder (Institute for Contemporary Studies; 2nd edition, June 1993)
First published in 1981, this book was closely associated with Ronald Reagan's rise to power. Skip over the social stuff. But if you start with the chapter called "The Inflationary State" and go on from there, Gilder has penned some remarkably insightful chapters on economic growth, inflation, productivity, and innovation.
Why Economies Grow: The Forces That Shape Prosperity and How We Can Get Them Working Again
by Jeff Madrick (Basic Books, October 2002)
The editor of Challenge Magazine is thoughtful about the wellsprings of economic growth, and puts forward a program of action.
Who's Afraid of Adam Smith: How the Market Got Its Soul
by Peter Dougherty (John Wiley & Sons, August 2002)
The leading economics book editor housed at Princeton University Press has written a labor of love about economics, economists, and the good society.
Chris Farrell's Top 12 >>Favorite books on investing >>Favorite books on personal finance >>Favorite books on broad trends and economic analysis >>Favorite Web sites >>
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