Breakfast  
 
 

  Extract from a report

GLOBAL  STRATEGY    
Popular  Delusions   Five  books  for  the  beach  
 

   
Q At  Christmas  I  offered  up  some  ideas  for  winter  reading  based  on  the  six  books  which  had  
    had   the   biggest   influence   on   my   thinking   over   the   years.   Now   that   summer   is   here,   which  
   
    means   the   rain   in   London   is   warm,   and   minds   are   wandering   to   more   exotic   locations,   I  
    thought  I’’d  lower  the  hurdle  a  little.  Here  are  five  books  I’’ve  read  recently,  really  enjoyed  and  
   
    think  you  might  too.    
    Q “The   Drunkard’s   Walk”   by   Leonard   Mlodinow   isn’’t   just   a   book   about   how   deceptive  
   
   
randomness  can  be;;  it’’s  about  our  apparent  emotional  need  to  reject  luck  as  an  explanation  
    for  the  events  shaping  our  lives  and  our  world.  I  actually  found  it  a  very  uplifting  book.  It’’s  not  
just  about  probability  or  even  investing,  but  about  life.  
Q “The   Little   Book   of   Behavioural   Investing””   by   James   Montier   is   a   brilliant   summary   of  
behavioural  finance  written  by  the  guy  who  did  more  than  anyone  else  to  bring  behavioural  
psychology   out   of   academia   and   into   the   investing   community.   It’’s   as   punchy   as   you’’d  
expect  from  anything  written  by  Montier,  and  with  characteristic  ““Little  Book””  conciseness.  
Q I   warn   you   now:   “Mobs,   Messiahs,   and   Markets”   by   Bill   Bonner   and   Lila   Rajiva   is  
impossible  to  put  down  once  you’’ve  started  it.  I  suppose  it’’s  a  book  about  mob  psychology,  
but  ……  that  just  doesn’’t  do  this  wonderful  book  justice.  Drawing  on  psychology,  evolutionary  
biology,  anthropology,  history,  politics  and  economics,  the  authors  -­  with  trademark  humility  
and  wit  ––  develop,  illustrate  and  warn  with  their  theory  of  ““the  Public  Spectacle””.    
Q  My  fourth  recommendation  might  not  strictly  count  as  beach  reading.  But  “Gold  and  Iron:  
Bismarck,  Bleichröder  and  the  forging  of  a  new  German  Empire”  by  Fritz  Stern  is  a  book  
I’’ve  been  meaning  to  read  for  a  while  and  only  got  round  to  a  few  months  ago  (largely  thanks  
to  being  stranded  in  a  hotel  room  by  an  ash  cloud!).  There  really  are  parallels  between  the  
rise  of  Germany  in  the  19th  century  and  of  China  in  the  21st  and  the  biographical  approach  
teases  out  the  story  wonderfully.    
Q “Lords  of  Finance”  by  Liaquat  Ahamed  is  a  book  I  read  last  Christmas  and  regular  readers  
will   recognise   it   because   I’’ve   quoted   heavily   from   it   ever   since.   The   Great   Depression   is  
possibly  one  of  the  most  analysed  episodes  in  economics.  But  this  is  genuinely  a  profoundly  
different   approach   to   studying   the   period.   Firstly,   it’’s   written   almost   as   a   biography   of   the  
four  most  prominent  central  bankers  of  the  day  as  they  struggled  from  one  crisis  to  another  
during   the   rolling   financial   implosions   that   characterised   the   years   from   1928   to   1933.  
Secondly,  the  story  starts  at  the  beginning,  in  WW1  where  the  seeds  of  the  problems  of  the  
1930s  were  sown  (written  in  five  parts,  the  crash  of  1929  isn’’t  covered  until  part  four).  Finally,  
the  Depression  is  treated  as  the  global  phenomenon  it  was,  in  contrast  to  the  prevalent  US-­
centred  treatments  which  view  the  episode  as  primarily  an  American  depression  triggered  by  
a   Wall   St   crash.   It’’s   one   of   the   best   accounts   of   the   Great   Depression   there   is   and   all   the  
better  for  being  so  brilliantly  told.    
Q Books   I’m   hoping   to   get   through   this   summer   are   ““The   Uses   of   Pessimism””   by   Roger  
Scruton,  ““The  Invisible  Hands””  by  Steve  Drobny,  ““Don’’t  Blame  the  Shorts””  by  Robert  Sloan  
and  ““Faultlines””  by  Raghuram  Rajan  
 
 
                             
 

    Dylan  Grice          
      (44)  20  7762  5872              
      dylan.grice@sgcib.com          
                     
Notice  to  US  investors:  Written  by  a  non-­US  research  analyst  not  registered/qualified  under  FINRA  Rules.  
THIS  RESEARCH  REPORT  IS  THE  PRODUCT  OF  SOCIETE  GENERALE  (AUTHORIZED  IN  FRANCE  BY  THE  AMF).  
PLEASE  SEE  IMPORTANT  DISCLOSURES  AND  ANALYST  CERTIFICATION  IN  THE  APPENDIX  
 
 

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