Book Bits For Saturday: 4.9.2011

The Big Secret for the Small Investor: A New Route to Long-Term Investment Success
By Joel Greenblatt
Summary via publisher, Crown Business/Random House
Let top hedge fund manager, Columbia business school professor, former Fortune 500 chairman and New York Times bestselling author, Joel Greenblatt, take you on a journey that will reveal the Big Secret for both individual and professional investors. Based on path-breaking new research, find out how anyone can beat the market, the index funds and the experts by following a new approach that relies on the principles of value investing, common sense and quantitative discipline. Along the way, learn where “value” comes from, how markets work, and what really happens on Wall Street. By journey’s end, small investors (and even not-so-small investors) will have found their way to some excellent new investment choices.

Financial Origami: How the Wall Street Model Broke
By Brendan Moynihan
Summary via publisher, Bloomberg Press/Wiley
Origami is the Japanese art of folding paper into intricate and aesthetically attractive shapes. As such, it is the perfect metaphor for the Wall Street financial engineering model, which ultimately proved to be the underlying cause of the 2008 financial crisis. In Financial Origami, Brendan Moynihan describes how the Wall Street business model evolved from a method to transfer risk into a method for manufacturing risk. Along the way, this timely book skillfully dissects financial engineering and addresses how it’s often a mechanism to evade regulatory constraints, provide institutional investors with customized products, and, of course, generate revenue for financial engineers.
* Reveals how Wall Street’s financial engineering business model morphed into something destructive.
* Highlights how the origami model worked well in the comparatively stable years of the early 2000s, when there was less risk to transfer.
* Discusses how Wall Street began manufacturing risk by creating products that multiplied risk exposures and encouraged subprime lending.
With the collapse of Lehman Brother the Wall Street business model effectively broke. But there are many lessons to be learned from what has transpired, and Financial Origami will show you what they are. With trillions of dollars worth of trades conducted every year in everything from U.S. Treasury bonds to mortgage-backed securities, the U.S. interest rate market is one of the largest fixed income markets in the world.
The Next American Economy: Blueprint for a Real Recovery
By William J. Holstein
Summary via publisher, Walker Books
At a time when debate is raging about how to create jobs and revive the American economy, veteran business writer William J. Holstein argues that the best way for us to recover our economic footing is to do what Americans do best—innovate and create new industries. Contrary to the perception that the American economy has run out of inspiration and new ideas, Holstein uses compelling case studies to celebrate the innovation and business success being experienced in many industries, from technology and energy to retraining and exporting, across the country, from Boston to Orlando, Pittsburgh to San Diego. In the face of economic powerhouses such as Japan and China that are pursuing conscious national strategies, Holstein argues that Americans must find new avenues of cooperation among universities, business, and government to create the kind of sustainable growth we need. Replete with fresh insights into how Americans can create a real economic recovery, The Next American Economy is essential reading for business leaders, politicians, strategists, and anyone who cares about our future.
Interest Rate Markets: A Practical Approach to Fixed Income
By Siddhartha Jha
Summary via publisher, Wiley
Interest Rate Markets: A Practical Approach to Fixed Income details the typical quantitative tools used to analyze rates markets; the range of fixed income products on the cash side; interest rate movements; and, the derivatives side of the business.
* Emphasizes the importance of hedging and quantitatively managing risks inherent in interest rate trades
* Details the common trades which can be used by investors to take views on interest rates in an efficient manner, the methods used to accurately set up these trades, as well as common pitfalls and risks providing examples from previous market stress events such as 2008
* Includes exclusive access to the Interest Rate Markets Web site which includes commonly used calculations and trade construction methods
Interest Rate Markets helps readers to understand the structural nature of the rates markets and to develop a framework for thinking about these markets intuitively, rather than focusing on mathematical models.
Truth, Errors, and Lies: Politics and Economics in a Volatile World
By Grzegorz W. Kolodko
Interview with author via Wilson International Center
This week on dialogue host John Milewski interviews author Grzegorz Kolodko about his latest book, Truth, Errors, and Lies: Politics and Economics in a Volatile World. In the book, Kolodko applies an interdisciplinary framework for understanding the global economy. Mr. Kolodko is one of the world’s leading thinkers on economics and development policy and was a key architect in Poland’s successful economic reforms when he served as the countries Deputy Prime Minister and Minister of Finance. He’s currently a Professor at Kozminski University where he heads the think tank “TIGER”, which stands for Transformation, Integration, and Globalization Economic Research