Book Recommendations for Investing, the Stock Market, and Life

David Graeber.  Anthropologist David Graeber presents a stunning reversal of conventional wisdom: he shows that before there was money, there was debt. Will forever change how you think about money. A must read, especially for Universal Basic Income (UBI) enthusiasts.

Nassim Nicholas Taleb.  Fooled by Randomness is a standalone book in Taleb’s landmark Incerto series, an investigation of opacity, luck, uncertainty, probability, human error, risk, and decision-making in a world we don’t understand.  The other books in the series are The Black Swan, Antifragile, and The Bed of Procrustes.

Nassim Nicholas Taleb.  A black swan is an event, positive or negative, that is deemed improbable yet causes massive consequences.  In this groundbreaking and prophetic book, Taleb shows in a playful way that Black Swan events explain almost everything about our world, and yet we—especially the experts—are blind to them.

Milton and Rose Friedman.  The international bestseller on the extent to which personal freedom has been eroded by government regulations and agencies while personal prosperity has been undermined by government spending and economic controls.  New Foreword by the Authors.  A treasure!

Milton Friedman.  A series of essays by Friedman from the 1970's, including his renown Playboy interview, which helped shape economic understanding for many Americans.  That interview alone is worth the price of the book.

Henry Hazlitt.  A classic economic primer for all ages.  Hazlitt’s focus on non-governmental solutions, anti-deficit position, and general emphasis on free markets, economic liberty of individuals, and the dangers of government intervention make Economics in One Lesson, every bit as relevant and valuable today as it has been since publication.  A perfect gift for all ages!

Fred Schwed exposes the folly and hypocrisy of Wall Street. The title refers to a story about a visitor to New York who admired the yachts of the bankers and brokers.  Naively, he asked where all the customers' yachts were?  Of course, none of the customers could afford yachts, even though they dutifully followed the advice of their bankers and brokers.  Full of wise contrarian advice, in a world where brokers get rich while their customers go broke, this book continues to open the eyes of investors to the reality of Wall Street.

Jim Paul and Brendan Moynihan's cautionary tale includes strategies for avoiding loss within the dangers of investing, trading, and speculating. Describes the circumstances and psychology leading up to Paul's $1.6 million loss and the essential lessons he learned from it―primarily that, although there are as many ways to make money in the markets as there are people participating in them, all losses come from the same few sources.

Michael Lewis.  The real story of the 2008 crash began in bizarre feeder markets where the sun doesn't shine and the SEC doesn't dare, or bother, to tread: the bond and real estate derivative markets.  The smart people who understood what was or might be happening were paralyzed by hope and fear; in any case, they weren't talking.

Michael Lewis.  A small group of Wall Street iconoclasts realize that the U.S. stock market has been rigged for the benefit of insiders.  They band together―some of them walking away from seven-figure salaries―to investigate, expose, and reform the insidious new ways that Wall Street generates profits.  If you have any contact with the market, even a retirement account, this story is happening to you.

Michael Lewis classic.  The time was the 1980s.  The place was Wall Street.  The game was called Liar’s Poker.  Here is Michael Lewis’s knowing and hilarious insider’s account of an unprecedented era of greed, gluttony, and outrageous fortune on Wall Street.

Mark Douglas uncovers the underlying reasons for lack of consistency and helps traders overcome the ingrained mental habits that cost them money.  He takes on the myths of the market and exposes them one by one teaching traders to look beyond random outcomes, to understand the true realities of risk, and to be comfortable with the "probabilities" of market movement that governs all market speculation.

Justin Fox.  A lively history of ideas, describes with insight and wit the rise and fall of the world’s most influential investing idea: the efficient markets theory.  Carries readers from the earliest days of Wall Street to the current financial crisis, debunking the long-held myth that the stock market is always right in the process while intelligently exploring the replacement theory of behavioral economics.

Niall Ferguson follows the money to tell the human story behind the evolution of our financial system, from its genesis in ancient Mesopotamia to the latest upheavals on what he calls Planet Finance.  Ferguson reveals financial history as the essential backstory behind all history, arguing that the evolution of credit and debt was as important as any technological innovation in the rise of civilization.

Peter L. Bernstein.  In this unique exploration of the role of risk in our society, Peter Bernstein argues that the notion of bringing risk under control is one of the central ideas that distinguishes modern times from the distant past. Against the Gods chronicles the remarkable intellectual adventure that liberated humanity from oracles and soothsayers by means of the powerful tools of risk management that are available to us today.

Joseph H. Ellis argues that the problem with current forecasting models lies not in the data, but rather in the lack of a clear framework for putting the data in context and reading it correctly.  The book explains critical economic indicators in nontechnical language, identifies and documents the recurring cause-and-effect relationships that consistently predict turning points in the economy, and provides the tools managers and investors need to position themselves ahead of cyclical upturns and downturns.

Daniel Kahneman.  Groundbreaking tour of the mind that explains the two systems that drive the way we think.  System 1 is fast, intuitive, and emotional; System 2 is slower, more deliberative, and more logical.  The difficulties of predicting what will make us happy in the future, the effect of overconfidence and cognitive biases on everything from investing to planning ― each can be understood only by knowing how the two systems shape our judgments and decisions.

Ray Dalio.  One of the world's most successful investors and entrepreneurs, and founder of the world's largest hedge fund (Bridgewater Associates), Ray shares the unconventional principles that he's developed, refined, and used over the past 40 years to create unique results in both life and business - and which any person or organization can adopt to help achieve their goals.

Scott Sumner.  Drawing on financial market data and contemporaneous news stories, Sumner shows that the Great Depression is ultimately a story of incredibly bad policymaking—by central bankers, legislators, and two presidents—especially mistakes related to monetary policy and wage rates. He also shows that macroeconomic thought has long been captive to a false narrative that continues to misguide policymakers in their quixotic quest to promote robust, sustainable economic growth.

Ed Easterling.  Probable Outcomes continues the Crestmont Research tradition of full-color charts and graphs that enable investors and advisors to differentiate between irrational hope and a rational view of the stock market. The unique combination of investment science and investment art explores the market from several perspectives, and addresses the implications for a broad range of investors.