BOOKS - What are ASF members reading?

[gav]

What I Learned Losing A Million Dollars by Jim Paul and Brendan Moynihan

This book is a refreshing change to the “How to get rich” or “How I made a million dollars” type books. It tells the story of a successful trader who lost it all, who later realised that almost all the success he’d had in life (not just trading) was due to sheer luck. He then set out to research what successful traders and investors do, and found that they all contradicted each other. But what many did have in common was the way they managed risk and losses. He boils the losing money to two traits:
- errors in analysis
- psychological factors which prevent you from applying the analysis
He claims that all analytical methods have some validity and make allowances for times when they don’t work, but the real problem is the psychological factors that keep you from executing your analysis (holding a loser, jumping from one method to another when the first has a brief drawdown, etc).

 

[Julia]

http://www.abc.net.au/tv/programs/jennifer-byrne-presents/#episode/AC1238H010S00

Jennifer Byrne has a conversation with one of Australia's most loved and awarded writers, Tim Winton.
Byrne shows empathy and sensitivity in this terrific half hour.
Tim Winton's intelligence and extraordinary perception of the lives of ordinary people is well brought out by Jennifer Byrne.
It's hard to imagine anyone with a greater genuine charisma than Tim Winton.

 

[gav]

Insanity: The Idea and Its Consequences by Thomas Szasz

Thomas Szasz was a psychiatrist with very controversial views about mental illness and they way psychiatry is conducted. He was also a libertarian, and many of his criticisms of psychiatry are based on libertarian principles. Szasz succinctly attacks conventional psychiatry on four grounds: morally, medically, linguistically and legally. The book is also used to defend against criticisms of his previous works.
*
This book isn’t huge (400ish pages), but it took me longer to read than any book I’ve read over the past 12 months (and I’ve read books twice as long). The main reason for this is that it isn’t very readable. It actually reads like a text book, which makes it difficult to read any more than a small section at a time. The font is quite small and the paragraphs are often huge, which doesn’t help. And Szasz often jumps from one topic to the next, then in a later chapter will add further comments to an earlier topic.
*
That said, the actual content is very detailed and quite amazing. Whether you agree with some, all, or even none of his views, Szasz will have you thinking about psychiatry and mental illness in ways in which you previously hadn’t. Some of the interesting topics include: literal and metaphorical diseases, coercive powers of psychiatrists, the history of psychiatry, pharmaceuticals (“the Therapeutic State”), social deviance, religion and belief systems, and diminished responsibility. He also talks about "mental illnesses" of the past, such as drapetomania (black slave running away), homosexuality and masturbation; and what they have in common with today's diagnoses.
*
Despite being one of the more difficult books I’ve read this year, it was thoroughly rewarding. For those interested in a very brief overview of Szasz’ work, I came across this blog post titled “Szasz in One Lesson”:
http://sheldonfreeassociation.blogspot.com.au/2011/01/szasz-in-one-lesson.html

 

[gav]

Man's Search For Meaning by Victor Frankl

Victor Frankl was a neurologist and psychiatrist. This book discusses the 3 years he spent in concentration camps during World War 2. Part One details Frankl’s experiences within the concentration camps. It deals with what life was like in the mind of an ordinary prisoner, and how different prisoners react to their environment. He discusses how there were both decent and cruel Nazi guards, and decent and cruel prisoners (such as the Kapo).

Part Two is an introduction to logotherapy, a school of psychiatric thought developed by Frankl which deals with the meaning of life. What I liked about this was the limited intervention by the therapist and a strong emphasis on personal responsibility for the patient (pretty much the opposite of mainstream psychiatry today). Logotherapy is also quite stoic.

The book can be summed up well with two quotes. The first by Frankl himself, and the second where Frankl quotes Nietzsche.

"…forces beyond your control can take away everything you possess except one thing, your freedom to choose how you will respond to the situation. You cannot control what happens to you in life, but you can always control what you will feel and do about what happens to you.”

“He who has a why to live for can bear almost any how”

 

[Judd]

Uncle Tom's Cabin;
The Riddle of the Sands;
Confessions of a Beachcomber; and
Heart of Darkness.

 

[johenmo]

And the Mountains Echoed by Khaled Hosseini

Set primarily in Afghanistan across decades, it's about family separation. "The book's foundation is built on the relationship between ten-year-old Abdullah and his three-year-old sister Pari and their father's decision to sell her to a childless couple in Kabul, an event that ties the various narratives together."

He writes well. his books "The Kite Runner "and "A Thousand Splendid Suns" sold well and were well received.

Now making my way through an Agatha Christie Omnibus.

 

[gav]

To Sell is Human by Daniel Pink

To Sell Is Human describes how almost everyone today is involved in selling – and even for the few that aren’t during their day job, they certainly are in their personal life. The basic premise is that sales is no longer what it used to be (eg. used car or door-to-door salesman). Today almost everyone works in sales because of our modern, inter-connected society. Even if you have no direct link to a customer - you might have to persuade your boss, negotiate an outcome, or pitch an idea in a meeting.

I bought this book mainly due to my interest in decision making (heuristics, behavioural psychology, etc), as well as a general interest in sales and marketing. I’d read great things about the author, and a few good reviews for this book. In fact, after seeing all the hype, I probably looked forward to reading this book more than any other book I’ve read this year.

Unfortunately, I found it quite thin on anything that you would expect from a book of its title: insights into persuasion and psychology were shallow, and it contains nothing regarding the history (or evolutionary benefits) of persuasion. If selling is such an ingrained part of being “human”, then why only write about the past 50 years? I understand that often these types of books are written in a “pop-science” kind of way to appeal to the lay reader, but this book had no depth whatsoever. Many of the “insights” were blatantly obvious eg. studies show that thinking from the other persons point of view can help with negotiations (gee, you think?). Even though it’s quite a short book (270 pages), it was also extremely repetitive.

Since reading this book, I’ve been told that Daniel Pink’s other books are excellent, and much better than this one. I’ve had a look at some of his others – but after this one, I just cannot bring myself to read any of his other work. If you are interested in reading about persuasion or marketing/sales, I have read a couple of the “classics” which I can recommend:
“How to Win Friends and Influence People” by Dale Carnegie and “Spin Selling” by Neil Rackham

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Why Zebras Don't Get Ulcers by Robert Sapolsky
Sapolsky is a neuroendocrinologist and a professor of biology. He has also spent many years studying primates in Africa. “Why Zebras Don’t Get Ulcers” is about stress, and stress related diseases. It covers how stress works in the environment we evolved for, and this differs to the chronic stressors we now face in a modern society. Many of the areas which stress affects are explored, including cardiovascular disease, sex and reproduction, the immune system, pain, memory, sleep, aging and death, and depression. Sapolsky also covers common personality types prone to stress and flawed coping mechanisms. Finally, he offers a brief section on how to manage stress.

There are a few areas that annoyed me about this book. Sapolsky is very anti-capitalist and anti-individualist, and often directly (or indirectly) points the blame of much of our stress to the capitalist system. However his examples which endorse this view reek of confirmation bias (and you could often use the same examples to argue a different view). He also spends most of the chapter on depression trying to convince the reader that depression is a real disease – to the point where it almost sounds like he is trying to convince himself! The arguments and data used will probably be enough to convince most readers, but have actually been defeated in the past by people like Thomas Szasz (see my earlier review of his book, “Insanity”).

My last gripe concerns the way he recommends exercise to help manage stress. Most exercise that is not taken to extreme will help, and is healthy. But he claims “The studies are quite clear that aerobic exercise is better than anaerobic exercise for health.” This is completely false. I could write pages on why this is false and provide plenty of evidence to the contrary.

Despite these few grievances, the majority of the book is well written and provides a fascinating insight into the chronic stressors of modern day life and the effects they have on our health. I’ll conclude by quoting the last paragraph of the book, which sums it up better than any words I could use:

“We return to the catalogue at the beginning of the first chapter, the things we all find stressful – traffic jams, money worries, overwork, the anxieties of relationships. Few of them are “real” in the sense that the zebra or lion would understand. In our privileged lives, we are uniquely smart enough to have invented these stressors and uniquely foolish enough to have let them, too often, dominate our lives. Surely we have the potential to be uniquely wise enough to banish their stressful old.”

 

[Baldric]

The Great Escaper by Simon Pearson.

The life of Roger Bushell.
For more info.
http://en.wikipedia.org/wiki/Roger_Bushell

 

[Judd]

Reading, again, The Iliad and the Odyssey. Recently finished The Divine Comedy.

 

[gav]

Economics In One Lesson by Henry Hazlitt

Economics In One Lesson is a fantastic introductory level look into economics and the price system. It has been praised by the likes of Milton Friedman, Mises, Ayn Rand and Ron Paul. The basic premise of the book (the “One Lesson”) can be summed up in just one sentence:

"The art of economics consists in looking not merely at the immediate but at the longer effects of any act or policy; it consists in tracing the consequences of that policy not merely for one group but for all groups."

This sounds pretty simple and straight forward, but Hazlitt argues that many ‘modern’ economists and governments have forgotten this lesson. He begins with the Broken Window Fallacy (originally presented by Frederic Bastiat), and continues to slay many conventional arguments relating to large government projects, tariffs, price fixing, minimum wages and unemployment, technology arbitraging away jobs, unions, bailing out favoured industries, the function of profits, inflation and the assault on savings.

Even though this book was written in 1946, it reads like an updated version of much of Frederic Bastiat’s work. It is quite short (only 200 pages) and is a very easy read. Whether you’re keen on learning all there is to know about economics, or just have a general interest in the topic, I cannot think of a better introductory book than Economics In One Lesson. A free copy can be viewed online at http://mises.org/books/economics_in_one_lesson_hazlitt.pdf

 

[gav]

Extraordinary Popular Delusions and the Madness of Crowds (by Charles Mackay) and Confusion de Confusiones (by Joseph De La Vega)

I read this book a few years ago. I think I enjoyed it more the second time round. This is actually two books in one. The first explores South Sea bubble, the Mississipi scheme and the Dutch tulip mania. The second looks at the Dutch East India Company and examines how a stock exchange worked in the 1600’s.

It has some fantastic insights into bubbles, herd behaviour, and some of the conniving schemes people come up with to make money. The main take away from this book is that when it comes to financial markets, human behaviour has changed very, very little over the past 400 years. A few of the commonalities include:
- bans on short selling during a crisis
- everyone is happy while they’re making money, but they claim to be “innocent victims” when the bubble bursts, and demand a scapegoat
- conmen, scams, and the bribing/lobbying of government officials
- trading principals and strategies

Some of the stories are extremely entertaining. Eg. A sailor unknowingly eating a tulip bulb worth the equivalent of $50k (thinking it was an onion), the selling of fake shares before a company became publicly listed, then using the profits from the fake shares to bribe government officials to pass an act that will allow the company to be publicly listed.

One of the most surprising things I learned (I cannot remember noticing it the first time I read the book) is the complexity of some of the trading instruments that were used. In the late 1600’s (less than 100 years after public stock exchanges emerged), people were shorting, using futures and options, and over-the-counter derivatives.

Extraordinary Popular Delusions and the Madness of Crowds and Confusion de Confusiones is a timeless classic. If you’re a trader or investor, it is a must have.

 

[drillinto]

"The money miners - The great Australian mining boom"

Publisher: Allen & Unwin, 1995

Author: Trevor Sykes

This a story of those who were more interested in mining money rather than minerals.

 

[Julia]

"American Rust" by Philipp Meyer. If one combined the talent, writing styles and settings of Steinbeck, Kerouac, Cormac McCarthy, this might be the result.

Starkly dramatic but about such ordinary people in an American small town. Vivid characterisations of the flawed people allow the story to unfold in a compelling way to an ultimately redemptive ending.

For me, this is up there with "The Narrow Road to the Deep North" by Richard Flanagan, "Eyrie" by Tim Winton, and "Barracuda" by Christos ("The Slap") Tsiolkas - all just profoundly absorbing and affecting novels.

 

[DocK]

"American Rust" by Philipp Meyer. If one combined the talent, writing styles and settings of Steinbeck, Kerouac, Cormac McCarthy, this might be the result.

Starkly dramatic but about such ordinary people in an American small town. Vivid characterisations of the flawed people allow the story to unfold in a compelling way to an ultimately redemptive ending.

For me, this is up there with "The Narrow Road to the Deep North" by Richard Flanagan, "Eyrie" by Tim Winton, and "Barracuda" by Christos ("The Slap") Tsiolkas - all just profoundly absorbing and affecting novels.

I'll add that one to my list. I've just finished "The Narrow Road to the Deep North" and found it to be very moving and thought-provoking. Not a "fun" read, but one that has made me reconsider some long-held beliefs about the subject. I also loved Eyrie (and everything of Winton's that I've read). "Barracuda" is on the ereader, but I keep starting something else first - it's quite sizable from memory. If you've found it to be up there with Eyrie and Narrow Road I might have to move it up the list, but I'm looking forward to reading a crime thriller by Mark Billingham first "The Dying Hours" - I enjoy his novels immensely.

 

[Julia]

Thanks for mentioning "The Dying Hours", DocK. I'm not familiar with Mark Billingham's work so will look this one out.

Don't be put off by the apparent size of "Barracuda". By the time I was halfway through I was wishing it was longer: that conundrum of feeling compelled to keep reading versus a reluctance to get to the end.
That's very much how "American Rust" affected me.

On "The Narrow Road to the Deep North", when I knew it was about the Thai Burma railroad I wasn't attracted to it at all, but all the critical acclaim prompted me to read it. It is so much more than an account of part of the second war, part love story, but ultimately a depiction of the stoicism of the human spirit.

Another novel that's quite different that you might also enjoy is "Bitter Wash Road" by Garry Disher, a quite literary writer of, broadly, crime fiction. There are some novels that deserve to be categorised somewhat outside the ubiquitous genre of "crime fiction" and this is one, with its perceptive study of flawed characters in a small outback South Australian town. A little similar is Stephen Orr's "One Boy Lost".
(There is an interview with Stephen Orr on today's "Books and Arts Daily" on Radio National).

 

[Judd]

Reverted to my childhood last night. The Wind in the Willows by Kenneth Grahame. Gorgeous fun.

 

[CanOz]

I've succumbed to the hype and just downloaded Flash Boys

 

[DocK]

Another novel that's quite different that you might also enjoy is "Bitter Wash Road" by Garry Disher, a quite literary writer of, broadly, crime fiction. There are some novels that deserve to be categorised somewhat outside the ubiquitous genre of "crime fiction" and this is one, with its perceptive study of flawed characters in a small outback South Australian town. A little similar is Stephen Orr's "One Boy Lost".
(There is an interview with Stephen Orr on today's "Books and Arts Daily" on Radio National).

Reviews look good, it sounds like a ripper - another for the "will get to one day" list! If only there were more hours in a day......

 

[CanOz]

I've succumbed to the hype and just downloaded Flash Boys

Well i finished this book on Saturday and honestly i couldn't put it down. Any investor or trader out there, you must read this, its a great read. Lewis explains the Wall Street world of HFT in way that its relatively easy to understand. You'll catch yourself shaking your head in disbelief at the stuff the Wall Street guys have been getting up to since the GFC...They just never run out of ideas...

9/10 for me...if i narrated the book anymore i'd give away half of the interesting parts....

 

[pavilion103]

No doubt many will be familiar with Malcolm Gladwell's books.

I've read "Outliers".

Almost finished "Blink"
Absolutely brilliant. Cannot recommend highly enough.
Applicable to trading also in terms of understanding how experienced traders can "thin-slice" information.

http://www.amazon.com/Blink-The-Power-Thinking-Without/dp/0316010669