Book Bits | 9.15.2012

The Value Investors: Lessons from the World’s Top Fund Managers
By Ronald Chan
Summary via publisher, Wiley
Investing legend Warren Buffett once said that “success in investing doesn’t correlate with I.Q. once you’re above the level of 125. Once you have ordinary intelligence, what you need is the temperament to control the urges that get other people into trouble in investing.” In an attempt to understand exactly what kind of temperament Buffett was talking about, Ronald W. Chan interviewed 12 value-investing legends from around the world, learning how their personal background, culture, and life experiences have shaped their investment mindset and strategy. The Value Investors: Lessons from the World’s Top Fund Managers is the result. From 106-year-old Irving Kahn, who worked closely with “father of value investing” Benjamin Graham and remains active today, and 95-year-old Walter Schloss (described by Warren Buffett as the “super-investor from Graham-and-Dodsville”), to the co-founders of Hong Kong-based Value Partners, Cheah Cheng Hye and V-Nee Yeh, and Francisco García Paramés of Spain’s Bestinver Asset Management, Chan chose investment luminaries to help him understand the international appeal – and success – of value investing. All of these men became strong advocates of the approach despite considerable age and cultural differences. Chan finds out why.

The Measure of a Nation: How to Regain America’s Competitive Edge and Boost Our Global Standing
By Howard Steven Friedman
Review via
The prose—simple, largely matter-of-fact and boldly stated—is not what makes The Measure a compelling read. The spare literary device may actually be one of the more compelling aspects of the book, which reduces it heft to an easily digested 226 pages liberally interspersed with graphic visualization of the points made. What makes the book compelling is the sense many have that America is losing its competitive edge in a global economy at a time economic collapse. Essentially, Friedman—who is a prominent American statistician, health economist, writer poet and artist is currently employed at the United Nations Population Fund, and as an adjunct Associate Professor at Columbia—has done what Adam Smith did for The Wealth of Nations to outline those attributes that contribute to the greatness of nations when measured against the performance in the global marketplace.
Advanced Technical Analysis of ETFs: Strategies and Market Psychology for Serious Traders
By Deron Wagner and Ed Balog
Excerpt via publisher, Wiley
In our first ETF book, Trading ETFs: Gaining an Edge with Technical Analysis, we focused on the use of very basic technical indicators including trend lines, moving averages, support and resistance levels, volume, and price action (swing highs and swing lows).Although it is not necessary, you mayfind it useful to read that book because it lays the groundwork for the advanced technical strategies covered in this book.
In this follow-up book, we will introduce several new technical indicators and strategies that enhance the effectiveness of our proven “top-down” trading strategy detailed in the last book. While the merits of our initial top-down strategy can certainly stand alone, applying additional technical indicators, strategies, and concepts only serves to improve the profitability of ETF traders.
The New Tycoons: Inside the Trillion Dollar Private Equity Industry That Owns Everything
By Jason Kelly
Video interview with author via Yahoo Finance
In the accompanying video, I discuss the state of the industry with Jason Kelly, a Bloomberg reporter and author of The New Tycoons: Inside the Trillion Dollar Private Equity Industry That Owns Everything. Thanks to Mitt Romney’s run for the White House, private equity has come under intense scrutiny. Kelly says the industry’s track record is much more complicated than is commonly portrayed. “Romney made it very much about jobs,” but most private equity firms “never set out to be about jobs,” Kelly says. “Private equity guys say ‘we do sometimes [create jobs], sometimes we don’t. It’s not really what we set out to do.'” What is clear is that when private equity firms get involved “it does tend to have an impact on workers,” he says. “Things are going to change if a private equity company buys the firm you work for. They don’t tend to do nothing.”
Guesstimation 2.0: Solving Today’s Problems on the Back of a Napkin
By Lawrence Weinstein
Summary via publisher, Princeton University Press
Guesstimation 2.0 reveals the simple and effective techniques needed to estimate virtually anything–quickly–and illustrates them using an eclectic array of problems. A stimulating follow-up to Guesstimation, this is the must-have book for anyone preparing for a job interview in technology or finance, where more and more leading businesses test applicants using estimation questions just like these. The ability to guesstimate on your feet is an essential skill to have in today’s world, whether you’re trying to distinguish between a billion-dollar subsidy and a trillion-dollar stimulus, a megawatt wind turbine and a gigawatt nuclear plant, or parts-per-million and parts-per-billion contaminants. Lawrence Weinstein begins with a concise tutorial on how to solve these kinds of order of magnitude problems, and then invites readers to have a go themselves. The book features dozens of problems along with helpful hints and easy-to-understand solutions. It also includes appendixes containing useful formulas and more.
The Digital Flood: The Diffusion of Information Technology Across the U.S., Europe, and Asia
By James Cortada
Summary via publisher, Oxford University Press
No technology seems to have spread so fast around the world in such a short period of time as computers. It was a phenomenon that predated the arrival of the Internet and that began to change how businesses, governments, and whole societies functioned. The diffusion of information technologies occurred in dozens of countries all over the world with fascinating similarities and differences. In this book, historian James W. Cortada provides the first world-wide history of how computers appeared and were used in North America, all of Europe, and in most of Asia in barely a half century. He explores the causes of diffusion, arguing that more than the technology itself, other conditions were required for the spread of computers, such as standards of living, education, the Cold War, and globalization of the economy. He argues that these technologies are the glue that hold together today’s economies and are propelling increases in the quality of life of over a billion people moving into the middle class.
Exchange Rate Regimes in the Modern Era
By Michael W. Klein and Jay C. Shambaugh
Excerpt via publisher, MIT Press
The dollar–euro exchange rate, perhaps ‘‘the world’s single most important price,’’ is determined by market forces, and changes day to day, and even minute to minute. In contrast, each of the countries of the European Union that uses the euro as its national currency experiences no exchange rate changes with the other members of the eurozone because they share a common currency. Why is it that the United States allows its currency to float, while Germany, France, and the other members of the eurozone have abandoned their national currencies and, effectively, have set a fixed exchange rate across Europe? Similarly, why does the government of China fix the value of its yuan to the US dollar, while the world foreign exchange market determines the daily value of the Brazilian real? The overarching policy of the government toward the exchange rate—to allow it to float or instead to fix or peg its value to another currency—is called the exchange rate regime. What are the economic and political implications of these different exchange rate regimes for these nations?