Given the recent financial crisis, it's no wonder that book shelves are littered with volumes chronicling the financial lessons that we have hopefully learned. But not all the financial books of 2009 deal with depression economics. Some are interesting, enlightening and, more importantly, useful. Let's start with those.
- "SuperFreakonomics: Global Cooling, Patriotic Prostitutes, and Why Suicide Bombers Should Buy Life" by Steven D. Levitt and Stephen J. Dubner.
For pushing your thinking outside the box, there is no better book than this. Answering questions like, "How is a street prostitute like a department store Santa?" or "Can eating kangaroo save the planet?" may not give you insight into your own life, but it will stretch your thinking about how the world actually works. To be fair, they do attack the terrorism and global warming issues with equal fervor, but it's the thought provoking issues of why incentives matter and the impact of unintended consequences that makes this a good read.
- "Animal Spirits: How Human Psychology Drives the Economy, and Why it Matters for Global Capitalism" by George Akerlof and Robert Shiller
This book takes behavioral economics to a new, understandable level and offers average people the opportunity to grasp concepts that not only put our recent financial market behavior into perspective, but also provide a foundation for understanding our own behavior, as irrational as it may be, and making better decisions.
- "The Greatest Trade Ever: The Behind-the-Scenes Story of How John Paulson Defied Wall Street and Made Financial History" by Gregory Zuckerman
Zuckerman provides traders with inspiration and the hope of pulling off a billion dollar gamble. The rest of us can get a look at how huge risk-taking evolves from an idea to a conviction and how taking action on your ideas can pay off, sometimes in a big way. The contrarian strategy John Paulson used isn't for everyone, but everyone that invests in the markets can learn from how he thinks and what he did.
- "Waste: Uncovering the Global Food Scandal" by Tristram Stuart
For green reading beyond global warming, consider this book. While it isn't light reading, it is illuminating as data and evidence trump the hyperbole that often overwhelms environmental writing. There are other problems in the world; a billion hungry people clearly make the list of big issues.
- "Poorly Made in China: An Insider's Account of the Tactics Behind China's Production Game" by Paul Midler
If you think China is going to take over the world, then reading this book might make you think again while making you laugh out loud. The firsthand account from a Mandarin speaking, Wharton schooled MBA provides a unique perspective on the economic miracle going on inside China. (FDI accounted for 30% of industrial output, 55% of trade and 11% of urban jobs in China in 2009. Learn more in Top 6 Factors That Drive Investment In China.)
No list of financial books in 2009 would be complete without an examination of the financial crisis. Here's a summary of the best books focused on financial calamity.
- "Lords of Finance: The Bankers Who Broke the World" by Liaquat Ahamed.
This work will put the recent financial crisis in perspective. It chronicles the central banks in the first part of the 20th century and the causes of the Great Depression. While it may seem like a dull subject, the parallels to recent history are striking and the lessons can help shape decision-making going forward.
- "Too Big to Fail: The Inside Story of How Wall Street and Washington Fought to Save the Financial System - and Themselves"
by Andrew Ross Sorkin
This is required reading for anyone that wants the inside scoop on the financial crisis. While this may not improve your financial situation, for those that like knowing what was said and by whom, this lengthy tomb will meet your needs.
"The Sellout: How Three Decades of Wall Street Greed and Government Mismanagement Destroyed the Global Financial System" by Charles Gasparino.
Here is another explanation of the recent financial woes and how we got there. Taking a broader approach than Sorkin, Gasparino tracks the greed back to the 1970s and shows how the once gilded era of Wall Street came crashing down around them. (Is the U.S. Congress' failure to rein in these mortgage giants to blame for the financial fallout? Find out in Fannie Mae, Freddie Mac And The Credit Crisis Of 2008.)
"This Time is Different: Eight Centuries of Financial Folly" by Carmen M. Reinhart and Kenneth Rogoff
This book provides a data-driven look at historical debt defaults around the world. The authors argue that the cycle of boom and bust has been around longer than most people realize and it isn't going away anytime soon. While historical in nature, it makes a solid case that the past is an indicator of the future.
"In Fed We Trust: Ben Bernanke's War on the Great Panic" by David Wessel
Wessel takes a different angle on the recent crisis focusing on the Federal Reserve and its chair, Ben Bernanke. With a look into how someone faces the potential of a second great depression and the impact of their day-to-day decisions, this book needs to be included any list of must-reads about the recent crisis.
The Bottom Line
Whether you are looking to educate yourself about the recession or looking for the perfect gift for the financially inclined person on your list, these books all provide great information and a great read.
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