Book Bits | 10 January 2015

The Change Book: How Things Happen
by Mikael Krogerus and Roman Tschäppeler
Summary via publisher (W.W. Norton)
From business cycles to budding trends, models make sense of a world that never stops spinning. The Change Book delivers 52 simple and effective models—each with a visual component—about how change happens. Drawing on myth-busting theories and breakthrough discoveries from thinkers of all stripes, Mikael Krogerus and Roman Tschäppeler, authors of the international bestseller The Decision Book, apply their characteristic wit and knack for the succinct to show what fuels the internet, why empires rise and fall, and why change hurts—but ultimately helps us grow.

Dead Companies Walking:
How A Hedge Fund Manager Finds Opportunity in Unexpected Places

by Scott Fearon with Jesse Powell
Review via Kirkus Reviews
Hedge fund owner/manager Fearon contrasts the methods of Wall Street experts and gurus, and the self-deception and illusions of many business managers, with his own ability to profit from such vulnerabilities. The author has ridden the roller coaster of finance and investment since the collapse of the Texas oil patch in the 1980s. Along the way, he became a successful investor by shorting the stock of companies destined to fail, and he founded his own hedge fund in 1991 and continues to run it. Fearon passed through a succession of investing styles as he worked to understand how self-delusions, obsessions and manias obstruct business success. Insights assimilated from his own failures—like the gumbo restaurant he located amid a non-Southern, spicy food–eating demographic, among others—were fuel for his subsequent successes.

Dear Investor, What the HELL are You Doing?:
Smart and Easy Ways to Fix the Mistakes You Make With Your Money

by Ken Weber
Summary via publisher (Greenleaf)
Despite its irreverent title, Dear Investor, What the Hell Are You Doing? has a serious purpose—to help you identify and fix the common blunders you may be making with your money. Long-time investment advisor Ken Weber exposes the minefield of financial tricks and psychological traps that ensnare millions of investors—beginners and old pros alike—and shows you what you should be doing instead.

When Globalization Fails: The Rise and Fall of Pax Americana
by James Macdonald
Review via Reuters (Edward Chancellor)
Few doubt that international trade usually increases the wealth of nations. Does it also bring peace? Many think so, but economic historian James Macdonald points out in “When Globalization Fails: The Rise and Fall of Pax Americana” that the last high point of globalization ended just over a century ago in a devastating world war – between countries which were also each other’s largest trading partners.

Quantitative Trading with R: Understanding Mathematical and Computational Tools from a Quant’s Perspective
by Harry Georgakopoulos
Summary via publisher (Palgrave Macmillan)
Quantitative Trading with R offers readers a glimpse into the daily activities of quants/traders who deal with financial data analysis and the formulation of model-driven trading strategies. Based on the author’s own experience as a quant, lecturer, and high-frequency trader, this book illuminates many of the problems that these professionals encounter on a daily basis. Answers to some of the more relevant questions are provided, and the easy-to-follow examples show the reader how to build functional R computer code in the process.

Rare: The High-Stakes Race to Satisfy Our Need for the Scarcest Metals on Earth
by Keith Veronese (Author)
Review via Nature
In 2010, a long-running dis- pute between China and Japan over owner- ship of the Senkaku Islands flared up, and China threatened to embargo shipments of rare-earth metals such as neodymium to Japan. Given China’s then near-monopoly on global supply, prices of rare-earth met- als spiked, and some Western governments became seriously worried about the threat to their high-tech manufacturing industries. These events demonstrate the geopolitical consequences of our need for an ever-widening range of elements in ever larger quantities. Competition and conflict over natural resources is nothing new, but in Rare, Keith Veronese gives this old story a modern twist. In an engaging, eclectic but sometimes rambling journey around this complex topic, he takes a ‘cradle to grave’ approach — from the stellar origins of these elements at the dawn of the Universe to their eventual fate in toxic landfills and backyard recycling sites in Africa and Asia.

Quantitative Finance: Back to Basic Principles
by Adil Reghai
Summary via publisher (Palgrave Macmillan)
The series of recent financial crises has thrown open the world of quantitative finance and financial modeling. The era of stochastic calculus is over and the time of Ito derivation as a unique tool of modelling is at an end. Today, quants need a broad
modeling skill set – one that transcends mathematics to price and hedge financial products safely and effectively, but that also takes into account that we now live in a world of more frequent crises, fatter tail risk and the optimized search for alpha. Quantitative Finance: Back to Basic Principles brings together new and proven methodologies from finance, physics and engineering, along with years of industry and academic experience to provide a cookbook of models for dealing with the challenges of today’s markets.