Book Bits | 2 November 2019

The Great Reversal: How America Gave Up on Free Markets
By Thomas Philippon
Summary via publisher (Belknap Press/Harvard University Press)
A leading economist argues that many key problems of the American economy are due not to the flaws of capitalism or the inevitabilities of globalization but to the concentration of corporate power. By lobbying against competition, the biggest firms drive profits higher while depressing wages and limiting opportunities for investment, innovation, and growth… American markets, once a model for the world, are giving up on healthy competition. Sector after economic sector is more concentrated than it was twenty years ago, dominated by fewer and bigger players who lobby politicians aggressively to protect and expand their profit margins. Across the country, this drives up prices while driving down investment, productivity, growth, and wages, resulting in more inequality. Meanwhile, Europe—long dismissed for competitive sclerosis and weak antitrust—is beating America at its own game.

The Man Who Solved the Market: How Jim Simons Launched the Quant Revolution
By Gregory Zuckerman
Review via Bloomberg/Barry Ritholtz
Every now and again, a book comes along that is so compelling, filled with so many fascinating characters and new information, that it demands a review.
“The Man Who Solved the Market: How Jim Simons Launched the Quant Revolution” is just such a book. Written by Wall Street Journal reporter Greg Zuckerman, it is a history of Simons and the secretive hedge-fund firm he founded, Renaissance Technologies LLC. Zuckerman spent 2-1/2 years researching the firm, eventually speaking to more than 40 current and former Renaissance employees. Despite the misgivings and deep opposition to this (or any) book about his career, Simons eventually agreed to sit for more than 10 hours of interviews.

Daylight Robbery: How Tax Shaped Our Past and Will Change Our Future
By Dominic Frisby
Essay by author via The Irish Times
Tax is power. Whether the ruler be king, emperor or government, without control of tax revenue, they are powerless. This rule has always applied, from the first king of ancient Sumer – one Alulim, reputedly a contemporary of Adam and Eve, who ruled in antediluvian times for an impressive 28,800 years – to the social democracies of today. Taxes are the fuel on which the state’s operations run. Limit taxes, and you limit ruling power.
Civilisations are shaped by the way they are taxed. A large part of a nation’s destiny – whether its people will be prosperous or poor, free or subordinated, happy or depressed – is determined by its system of tax.

Return of the Active Manager: How to apply behavioral finance to renew and improve investment management
By C. Thomas Howard and Jason Apollo Voss
Summary via publisher (Harriman House)
Emotional behavior and biases run throughout financial markets. This is the diagnosis of behavioral finance. But it is not enough to know that investors make biased decisions. What do we do about it? How do we move beyond diagnosis, to prescription? In this groundbreaking new book, investing and behavioural finance experts Thomas Howard and Jason A. Voss plug this void and show the new way ahead for investment managers and advisors. Return of the Active Manager provides a set of tools for investment professionals to overcome and take advantage of behavioral biases.

Building a Resilient Tomorrow: How to Prepare for the Coming Climate Disruption
By Alice C. Hill and Leonardo Martinez-Diaz
Interview with co-author (Hill) via Council on Foreign Relations
I sat down with Alice Hill, CFR’s senior fellow for climate change policy, to talk about the coming climate disruption… Here are three takeaways from our conversation [including]: Adapting to climate disruption means building a more resilient economy and society. Cutting the emission of heat-trapping gasses is the best resilience strategy of all. But global emissions are increasing, not shrinking. Even if emissions could be cut to zero today, climate disruptions will occur because so many heat-trapping gasses have already been pumped into the atmosphere. The political challenge is to ensure that the efforts to adapt to predictable climate disruptions don’t come at the expense of fighting what is causing them in the first place.

We Have Never Been Middle Class: How Social Mobility Misleads Us
By Hadas Weiss
Summary via publisher (Verso)
Tidings of a shrinking middle class in one part of the world and its expansion in another absorb our attention, but seldom do we question the category itself. We Have Never Been Middle Class proposes that the middle class is an ideology. Tracing this ideology up to the age of financialisation, it exposes the fallacy in the belief that we can all ascend or descend as a result of our aspirational and precautionary investments in property and education.

Please note that the links to books above are affiliate links with and James Picerno (a.k.a. The Capital Spectator) earns money if you buy one of the titles listed. Also note that you will not pay extra for a book even though it generates revenue for The Capital Spectator. By purchasing books through this site, you provide support for The Capital Spectator’s free content. Thank you!