April 21, 2012
Book Bits | 4.21.2012
● Land of Promise: An Economic History of the United States
By Michael Lind
Review via History Book Club
This election year offers Americans an unusually clear choice between competing visions of the republic: On the one hand a minimalist government presiding over a lightly-taxed populace left free to succeed (or not) on their own devices; or a more actively engaged government intervening in economic development and social policy to pursue what it perceives as the general welfare. Michal Lind’s splendid new economic history of the United States shows that these two competing visions are almost as old as the republic itself. This is a book that would be welcome anytime, but that is especially timely in the run-up to the 2012 elections. Anyone even slightly acquainted with American history will recognize these as the Jeffersonian and Hamiltonian strains of American public policy. Yet history is full of ironies: Jefferson remains one of the great heroes of the Democratic Party, but the real Jeffersonians of our time are the Tea Party Republicans, while Democrats tend to be Hamiltonian in outlook. The strands of history make a tangled skein. Michael Lind untangles those strands for us in this lucid, fascinating, highly readable book. He presents American economic history as a succession of “republics,” each characterized by its own economic forces and policies, each destabilized by the forces that would create its successor.
● The Sector Strategist: Using New Asset Allocation Techniques to Reduce Risk and Improve Investment Returns (Wiley Finance)
By Timothy McIntosh
Summary via publisher, Wiley
Presenting a revolutionary new investment philosophy that redefines how we view sector investing, The Sector Strategist challenges long held ideas about how this unique area of finance operates. Misconceptions, such as the belief that international stocks provide diversification, are preventing investors from making the most of the opportunities for financial growth that sectors provide, and the book presents practical, applicable evidence that a better, more profitable option is available. Additionally, the book hopes to give readers an opportunity to improve returns and protect retirement assets by providing a wide range of techniques and tools designed to optimize wealth that the author has developed over the last decade.
● From Bear to Bull with ETFs
By David Kotok
Q&A with author via IndexUniverse
IndexUniverse: You recently wrote a book on sector investing with ETFs. Why are sectors a useful way to approach the market?
Kotok: The benchmark for the U.S. stock market is the S&P 500 Index. It is composed of sectors and they are key to gaining performance. The ETF choices among the sectors facilitate this process. Choosing a sector to overweight or underweight requires macro inputs and a rationale for the decision. This is coupled with selection of broader characteristics such as growth vs. value or large-cap vs. small-cap. In some cases, you can combine them.
IndexUniverse: Which two U.S. sectors look the most attractive to you right now and how are you investing in them with ETFs?
Kotok: We like the health care sector. The broad-based ETF is XLV [the Select Sector SPDRs – Healthcare (NYSEArca: XLV)], and we hold it.
● The Great Recession: Market Failure or Policy Failure?
By Robert Hetzel
Review via John Taylor's Economics One blog
The debate about the causes of the financial crisis and the great recession will continue for many years, and the facts and analysis that Robert Hetzel put forth in his new book The Great Recession: Market Failure or Policy Failure? should now be part of that debate. As I said in my comments for Cambridge University Press, “Hetzel applies his experience as a central banker and his expertise as a monetary economist to make a compelling case for rules rather than discretion, showing that 'monetary disorder' rather than a fundamental 'market disorder' is the cause of poor macroeconomic performance. At the same time, he acknowledges and discusses disagreements among those who argue for rules rather than discretion.”
● Risk Intelligence: How to Live with Uncertainty
By Dylan Evans
Review via Publishers Weekly
A lecturer in behavioral science at University College Cork School of Medicine in Ireland, Evans (Placebo: The Belief Effect) defines risk intelligence as “the ability to estimate probabilities accurately,” such as the probability of a car crash or the truth of a rumor. Evans explores everything from climate change predictions to Homeland Security’s color-coded system that supposedly rated the risk of terrorist attacks. Evans outlines why many are so bad at estimating probabilities—with sometimes devastating consequences, such as in the financial crisis and 9/11—and how one can become better at it, since it’s a vital skill for gaining success in life. With an arsenal of studies and statistics, he covers fascinating topics, including battlefield strategies, overconfidence, lies, and the tendency to follow the crowd, despite obvious evidence they are wrong.
● The Debt Bomb: A Bold Plan to Stop Washington from Bankrupting America
By Sen. Tom Coburn with John Hart
Adapted excerpt via The Washington Examiner
I am known as a senator in Washington, but I will always be a medical doctor first. And if America were one of my patients, I would tell her she had a 100 percent chance of experiencing a major cardiac event -- a potentially fatal heart attack or stroke -- if she failed to take immediate steps to get healthy. In many respects, our recent recession may have been mere chest pains compared with what is coming. To many Americans, the cures are blindingly obvious: spend less, borrow less, keep taxes low and reform entitlement programs in a way that protects the poor. One reason I released my "Back in Black" deficit reduction plan, which includes $9 trillion in savings, was to show that these changes are possible. The real problem in Washington is not gridlock or money in politics, nor is it a lack of ethics reform or solutions. It is careerism -- the philosophy of governing to win the next election above all else. For the career politician, the moment to do what is right is never today. It is always a mirage just beyond the horizon of the next election.
● The Clash of Economic Ideas: The Great Policy Debates and Experiments of the Last Hundred Years
By Lawrence White
Summary via publisher, Cambridge University Press
The Clash of Economic Ideas interweaves the economic history of the last hundred years with the history of economic doctrines to understand how contrasting economic ideas have originated and developed over time to take their present forms. It traces the connections running from historical events to debates among economists, and from the ideas of academic writers to major experiments in economic policy. The treatment offers fresh perspectives on laissez faire, socialism and fascism; the Roaring Twenties, business cycle theories and the Great Depression; Institutionalism and the New Deal; the Keynesian Revolution; and war, nationalization and central planning. After 1945, the work explores the postwar revival of invisible-hand ideas; economic development and growth, with special attention to contrasting policies and thought in Germany and India; the gold standard, the interwar gold-exchange standard, the postwar Bretton Woods system and the Great Inflation; public goods and public choice; free trade versus protectionism; and finally fiscal policy and public debt.
● America's First Great Depression: Economic Crisis and Political Disorder After the Panic of 1837
By Alasdair Roberts
Summary via publisher, Cornell University Press
For a while, it seemed impossible to lose money on real estate. But then the bubble burst. The financial sector was paralyzed and the economy contracted. State and federal governments struggled to pay their domestic and foreign creditors. Washington was incapable of decisive action. The country seethed with political and social unrest. In America's First Great Depression, Alasdair Roberts describes how the United States dealt with the economic and political crisis that followed the Panic of 1837. As Roberts shows, the two decades that preceded the Panic had marked a democratic surge in the United States. However, the nation's commitment to democracy was tested severely during this crisis. Foreign lenders questioned whether American politicians could make the unpopular decisions needed on spending and taxing. State and local officials struggled to put down riots and rebellion. A few wondered whether this was the end of America's democratic experiment.
● Eco-Tyranny: How the Left's Green Agenda will Dismantle America
By Brian Sussman
Summary via publisher, WND Books
Exorbitant energy prices, rolling blackouts, acute food shortages, critical water deficiencies, and private property rights usurped: this is America’s future as envisioned by the environmental movement’s well-honed green agenda. In order to de-develop the United States, the Left is using phony environmental crises to demonize capitalism and liberty, and purposefully withhold America’s vast natural resources-and the Obama Administration is piloting the plan.Eco-Tyranny , by best-selling author Brian Sussman, presents a rational strategy to responsibly harvest our nation’s vast resources in order to fulfill the future needs of a rapidly growing population.
● Harvest the Wind: America's Journey to Jobs, Energy Independence, and Climate Stability
By Philip Warburg
Review via Kirkus Reviews
Warburg believes that that collaboration between the government and the private sector can make wind power a major source of energy for the generation of power in the United States. An attorney specializing in environmental law who served as president of the Conservation Law Foundation from 2003 to 2009, the author has been a committed environmentalist for more than 40 years. Warburg makes the case that with this “inexhaustible domestic energy resource,” America can finally demonstrate a willingness to lead the international fight for climate stability. He reports on recent travels through the U.S. and in Denmark. where he met with “farmers, ranchers, shop owners, truckers, crane operators and more,” whose lives have been improved by the new technology. He also visited large and small-scale wind farms, on land and offshore. While Warburg admits that wind power still presents serious problems for the environment—the turbines are responsible for the death of thousands of birds, the noise they produce can disturb neighboring residential communities, etc.—he is optimistic that these will be resolved and that the benefits of the new technology exceed the costs.
Posted by jp at April 21, 2012 5:40 AM