In September 2008, Chicago School conservative Judge Richard A. Posner broke from his past and wrote (in The New Republic) that deregulation was one of the primary causes of  the 2008-09 recession. He hailed John Maynard Keynes’s 1936 classic, The General Theory of Employment, Interest, and Money, and said that “despite its antiquity, it is the best guide we have to the crisis.”

Indeed, the financial crisis has led to lost confidence in the laissez faire style of economic policy, and a Keynesian revival. Keynes advocated for an interventionist government role in the market economy in cooperation with private initiative, to mitigate the adverse effects of recessions and booms—a view that influenced FDR’s new deal policies. (Click on the book images for details.)

Keynes: The Return of the Master
By Robert Skidelsky
Public Affairs Publishing, 2009, 240 pages
$17.13 hardcover, $14.27 Kindle

Skidelsky, Keynes’s preeminent biographer, contends that Keynes’s mixture of pragmatism and realism distinguishes his thinking from the neo-classical or Chicago school of economics.

Paul Krugman, who won a Nobel Prize in economics, said Skidelsky’s book is “a must read even if one doesn’t fully accept its conclusions…This is a wonderfully stimulating book, one that reflects the author’s unparalleled erudition. We’re living in the second Age of Keynes—and Robert Skidelsky is still the guide of choice.”

The Keynes Solution: The Path to Global Economic Prosperity
By Paul Davidson
Palgrave Macmillan, 2009, 208 pages
$14.96 hardcover, $9.99 Kindle

Davidson “exposes the intellectual mistakes which led to the present world economic downturn,” wrote Skidelsky of his competitor, ”and shows how Keynes’s ideas can help bring about a ‘civilized economic society.”

Davidson provides insights into how we got into the crisis—but more importantly how to use Keynes economic philosophy to get out of this mess. He makes recommendations and presents plans for spending, monetary policy, financial market rules and regulation, and wages.

John Maynard Keynes
By Hyman Minsky
McGraw-Hill, 2008, 181 pages
$16.47 paperback, $14.82 Kindle

This book is for economists and financial professionals, not general readers. Minsky argues that what most economists consider Keynesian economics is at odds with the major points of Keynes’s The General Theory of Employment, Interest, and Money. Too many contemporary economists ignore “pervasive uncertainty.” Once uncertainty is given center stage, recurring episodes of financial system crises are inescapable.

For balance, see my review of three books that present a conservative viewpoint:

• Meltdown, by Thomas E. Woods, Jr.
• End the Fed, by Ron Paul
• Architects of Ruin, by Peter Schwiezer

Click on the book images for details.

The House of Medici: Its Rise and Fall
By Christopher Hibbert
Harper Perennial, 1999, 364 pages
$11.52 paperback

Founded in 1397 by Giovanni di Bicci de’ Medici in Florence, the Medici Bank became the largest and most respected bank in Europe, and flourished for 100 years. The Medici family was of course phenomenally wealthy and powerful, but more than that: they were influentially involved in science, art, architecture, religion, and affairs of the heart, for two more centuries after the bank’s demise. The House of Medici patronized Michelangelo, Galileo, and Botticelli (and, indirectly, Da Vinci), who made Florence the heart of the Renaissance.

Cosimo’s grandson Lorenzo the Magnificent (1449-1492) is perhaps the most famous Medici. He ruled the Florentine Republic and brokered peace between the various Italian states. He excelled in the classics, sports, poetry, and music (though not in finance). Two of his sons became powerful popes: Leo X and Clement XII. (See Magnifico: The Brilliant Life and Violent Times of Lorenzo de’ Medici, by Miles J. Unger, Simon & Schuster, 2009.)

Not all the Medicis were so respectable. In the 17th century, Ferdinando II de’ Medici, Grand Duke of Tuscany, abandoned the family’s patronage of Galileo when the Inquisition accused him of heresy (for contending the the earth revolved around the sun, not vice-versa). In the 18th century, Cosimo III de’ Medici, another Grand Duke of Tuscany, persecuted Jews and sparked Tuscany’s bankruptcy by imposing punitive taxes on the populace.

The author Hibbert has written more than 50 books of history and biography, including Disraeli (2004) and Queen Victoria (2000).

The House of Rothschild: Volume 1: Money’s Prophets: 1798-1848
By Niall Ferguson
Penguin, 1999, 672 pages
$16.50 paperback, $14.85 Kindle

The House of Rothschild: Volume 2: The World’s Banker: 1849-1999
By Niall Ferguson
Penguin, 2000, 544 pages
$16.50 paperback

The House of Rothschild, founded in the late 18th century by expatriate German Jews, was at one time the largest banking enterprise in the world. Its principals controlled a vast portion of the industrial world’s wealth and dominated the international bond market. Consequently the family enjoyed significant political influence in the major capitals of Europe, up to the early 20th century.

Ferguson’s two-volume history of the Rothschild banking dynasty is both “exhaustive [and] spellbinding,” said Publishers Weekly. It also presents a vivid picture of the “financial, political, and military aspects of early 19th-century European life.”

Volume 1 begins with merchant Mayer Amschel Rothschild and his wife, who raised five boys in the Frankfurt Judengasse (Jewish ghetto). The sons spread out to different European cities around 200 years ago. The most capable of them, Nathan Mayer, located in London; and the others in Paris, Vienna, Naples, and Frankfurt. Each founded a branch of the Rothschild bank, with headquarters in London. The brothers’ remarkable unity, combined with geographical dispersion, gave their bank an overwhelming competitive advantage.

Volume 2 begins at the peak of the Rothschilds’ wealth and power, which enabled them to act as power brokers throughout the world. Through shrewd, complex negotiations they helped promote the beginnings of economic union throughout Europe. They financed Spain’s railroad and Rhodes’s diamond and gold mines in South Africa.

The rise of national socialism and changes in international banking, coupled with a new generation of Rothschilds who cared less about maintaining their holdings than enjoying themselves, led to a substantial decline in the family’s authority and wealth.

Ferguson, a Harvard history professor and author of The Ascent of Money (Penguin, 2008), focuses primarily on the Rothschilds’ public life, warts and all. If you want to read more about the character and relationships of the family members, see The Rothschilds, by Frederic Morton (Kodansha Globe, 1998, 360 pages).

The House of Morgan: An American Banking Dynasty and the Rise of Modern Finance
By Ron Chernow
Grove Press, 2001, 832 pages
$14.96 paperback

The glory years of the Morgan banking dynasty focused on the founder’s grandson, John Pierpont (J.P.) Morgan, who inherited the bank from his father, Junius P. Morgan, in 1890. With J.P. at the helm (until he died in 1913), the House of Morgan “behaved like a sovereign state, commanding more wealth than most countries…engaging in shadowy diplomatic missions, writing the script for war or peace, propping up governments or toppling them” (Entertainment Weekly).

The aristocratic J.P. commanded his empire from Morgan headquarters at 23 Wall Street, New York. The bank, known for integrity and secrecy, accepted only rock-solid corporations and old-moneyed families as clients. J.P. himself dominated American corporate finance—in 1892 he engineered the merger that resulted in General Electric, and in 1901 he merged several steel and iron companies to form U.S. Steel. He collected “Old Masters and young mistresses.” (EW) Thanks to J.P.’s legendary wealth and power (and big stogies), he became the populist symbol of predatory, monopolist bankers.

J.P. died in 1913, leaving his fortune and bank to his son, John Pierpont (Jack) Morgan, Jr. Jack was a more-than-competent banker, but the Glass-Steagall Act of 1933 forced him to split the House of Morgan into a commercial bank (J. P. Morgan & Co., later renamed Morgan Guaranty Trust), an investment bank (Morgan Stanley), and an overseas securities house (Morgan Grenfell in London). Thus ended the years of imperial glory.

The second half of the book presents an institutional history of the three divergent branches up through the “morass of takeovers and junk bonds” of the 1980s.  EW said, “Chernow is properly scathing about this descent into tawdry greed.” Unfortunately, the second half is nowhere near as fascinating as the first half (I quit reading it partway into the second half).

Chernow also wrote Titan: The Life of John D. Rockefeller, Sr., and The Warburgs. His biography of Alexander Hamilton is one my all-time favorite works of non-fiction.

Click on the book images for details or to purchase.

Meltdown: A Free-Market Look at Why the Stock Market Collapsed, the Economy Tanked, and Government Bailouts Will Make Things Worse
By Thomas E. Woods Jr.
Regnery Press, 2009, 194 pages
$18.45 hardcover, $9.99 Kindle

Woods offers a free-market, small-government assessment of the worldwide financial crisis of 2008-09. He blames the U.S. Federal Reserve System, and argues that the only way to rebuild our economy is by returning to the “fundamentals of capitalism” and letting the free market work. Bailouts can provide temporary relief but ultimately make things worse, he says.

Woods is also the author of The Politically Incorrect Guide to American History (2004), and is coauthor of Who Killed the Constitution? (2009).

End of the Fed
By Ron Paul
Grand Central Publishing, 2009, 224 pages
$14.95 hardcover, $9.99 Kindle

Most people think of the Fed as indispensable to a properly functioning country. Paul, an 11-term Texas Congressman and physician, draws on American history, economics, and stories from his own long political life to argue that the Fed is both corrupt and unconstitutional. It is inflating currency today at nearly a Weimar or Zimbabwe level, a practice that threatens to put us into an inflationary depression, he warns. He proposes a way to fix America’s economic policy for future generations.

Architects of Ruin: How Big Government Liberals Wrecked the Global Economy
By Peter Schweizer
Harper, 2009, 240 pages
$16.49 hardcover, $9.99 Kindle

The 2008-09 meltdown was “a massive failure of social engineering by liberals,” Schweizer says. It was “Robin Hood capitalism run wild.” A coalition of left-wing activists, liberal politicians, and “do-good capitalists” on Wall Street leveraged government power to achieve their goal of broadening homeownership among minorities and the poor. The results were not only devastating to the economy, but hurt the very people they were supposedly trying to help. Those same culprits are now trying to lead us out of the crisis and into a “massive overhaul of the American economic system.” The “green” technology movement, for example, will cause another bubble and crisis. Schweizer is strident, not ashamed to make ad hominem attacks (Jesse Jackson is a “race-baiter”).

Balance, anyone?

In September 2008, the Chicago School conservative Judge Richard A. Posner broke from his past and wrote (in The New Republic) that deregulation was largely responsible for the recession. He hailed John Maynard Keynes’s 1936 classic, The General Theory of Employment, Interest, and Money, and said that “despite its antiquity, it is the best guide we have to the crisis.”

For a new perspective on Keynes, see The Keynes Solution: The Path to Global Economic Prosperity, by Paul Davidson (Palgrave Macmillan, 2009). Keynes advocated for an interventionist government role in the market economy in cooperation with private initiative, to mitigate the adverse effects of recessions, depressions, and booms—a view that influenced FDR’s new deal policies.

Click on the book images for details or to purchase

The Battle for Wall Street: Behind the Lines in the Struggle that Pushed an Industry into Turmoil
By Richard Goldberg
Wiley, 2009, 240 pages
$19.77 hardcover, $15.82 Kindle

A conflict of epic financial proportions has begun on Wall Street. The opposing forces are (a) the sellers, an army of commercial and investment bankers, some of the more prominent of which were humbled into restructuring as commercial banks; and (b) the buyers, an army of hedge fund managers and private equity groups. It is a battle to dominate the market known as the investment community. Goldberg, a Wall Street veteran, describes the strategies and steps he thinks will create future winners.

Nerds on Wall Street: Math, Machines and Wired Markets
By David J. Leinweber
Wiley, 2009, 353 pages
$26.37 hardcover, $21.10 Kindle

Leinweber, one of the Wall Street quants who developed electronic trading innovations, gives a humorous (sometimes silly), inside look at the technological revolution in equity trading. The author is a founding director of the Center for Innovative Financial Technology at the Haas School of Business, University of California at Berkeley.

“This is a delightfully entertaining romp across the trading floors and through the research departments of major financial institutions, told by one of the early architects of automated trading,” says Andrew W. Lo, professor of finance at MIT Sloan School of Management

“It’s time to stop hoping for China’s failure and start…adapting to its success,” wrote Fareed Zakaria in Newsweek (10/26/09). Here are the best out of a slew of books on the subject. [Click on the book images for details.]

The Future of Chinese Capitalism
By Gordon Redding and Michael A. Witt
Oxford University Press, 2008, 275 pages
$60 hardcover, $48 Kindle

Redding and Witt present a comprehensive exploration of China’s economic system, how that system is evolving, and how it might change over the next couple of decades. They leave no doubt that China is re-emerging to its historical position of eminence in the world economy.

Redding is director of the Euro-Asia and Comparative Research Centre at INSEAD, and former director of the business school at the University of Hong Kong. Witt teaches international business at INSEAD and is a researcher at Harvard’s Reischauer Institute.

“Though a weighty academic work, the book is written in a quite reader-friendly style that researchers, college students, and even managers would appreciate,” according to the International Business Review.

The Chinese Economy: Transitions and Growth
By Barry Naughton
MIT Press, 2007, 504 pages
$14.66 paperback

Naughton first presents a historical overview of the pre-1949 economy; then describes industrialization, reform, and market transitions that have taken place since. He analyzes patterns of growth and development, including population growth and the one-child family policy; the rural economy, including agriculture and rural industrialization; industrial and technological development in urban areas; international trade and foreign investment; macroeconomic trends and cycles and the financial system; and the largely unaddressed problems of environmental quality and the sustainability of growth.

Written as a textbook but accessible to general readers, it compares China’s economy with other transitional and developing economies, and also to advanced industrial countries such as the USA and Japan.

China Into the Future: Making Sense of the World’s Most Dynamic Economy
By W. John Hoffman and Michael Enright
Wiley, 2007, 220 pages
$19.77 hardcover

This book is notable for covering demographics, social imbalances, regional disparities, environmental degradation, and corruption, all of which will force the Chinese government to depart from past policies in unanticipated ways. It provides alternative scenarios for China’s future, rather than a single, linear projection.

For another look below the glossy surface of economic growth, see Empire of Lies: The Truth About China in the Twenty-First Century, by By Guy Sorman (Encounter Books, 2008, 325 pages; $16.72 hardcover, $7.99 Kindle). Sorman asserts that to achieve astonishing economic growth over the last three decades, China’s leaders have brutally oppressed the downtrodden masses and shackled its media under censorship. China has seduced the West into conferring greater legitimacy on it than do the Chinese themselves, says Sorman, who has traveled to China regularly since 1967 and lived there through 2005 and 2006.

The Chinese Century: The Rising Chinese Economy and Its Impact on the Global Economy, the Balance of Power, and Your Job
By Oded Shenkar
Wharton School Publishing, 2006, 256 pages
$12.23 paperback, $9.78 Kindle

Within 20 years China will have the world’s largest economy, if projections can be trusted. China’s continued growth is leading to a radical restructuring of the global business system, says Shenkar (professor of management and HR at Ohio State University’s Fisher College of Business). He also offers, in a new epilogue, strategies and tactics for U.S. companies to compete with Chinese companies and succeed in Chinese markets.

China is restoring its imperial glory by infusing modern technology and market economics into a non-democratic system controlled by the Communist Party bureaucracy. China is already the #2 economy in the world for direct foreign investment, behind the USA. The Chinese Century demonstrates how China is leveraging the world’s most powerful pool of human resources, how it will sustain dominance in low-tech industries as it enters high-tech realms, and how its disregard for intellectual property rights creates sustainable competitive advantage.

Superfusion: How China and America Became One Economy and Why the World’s Prosperity Depends on It
By Zachary Karabell
Simon & Schuster, 2009, 352 pages
$17.16 hardcover, $9.99 Kindle

In September 2008, China became the USA’s largest creditor. China buys billions of dollars in U.S. Treasury bills, which allows us to keep interest rates low; low interest rates encourage Americans to spend more money than they have; Americans especially like to consume low-priced Chinese goods; so China has been happy to fuel this cycle of investment and consumption. Thus our two countries have become partners, says Karabell: “The Chinese and U.S. economies have fused to become one integrated system. Americans should embrace this fusion, even if it means ceding some of our global dominance, to ensure our prosperity in the future.”

Karabell downplays the fact that the relationship is more a codependency than a partnership—like drug dealer and addict. Now the USA has overdosed on debt, while China keeps saving, investing, and growing. China’s premier Wen Jiabao stated that he is worried about the safety of China’s investment in the USA. How long can the “partnership” last? Karabell underestimates the potential for conflict and the impediments to the happily integrated system that he envisions.

Click on the book images for details or to purchase.

Den of Thieves
By James B. Stewart
Touchstone Books, 1992, 587 pages
$11.56 paperback

Pulitzer Prize-winner Stewart tells of the biggest insider trading ring in Wall Street history, during the 1980s, centering on arbitrageur Ivan Boesky and junk bond king Michael Milken (of Drexel Burnham Lambert). Both of them seem stranger than fiction. Also in the ring were Drexel financiers Dennis Levine and Martin Siegel. The first half of this 1992 bestseller lays out their get-rich schemes, and the second half tells how prosecutors nailed them.

The Predators’ Ball: The Inside Story of Drexel Burnham and the Rise of the Junk Bond Raiders
By Connie Bruck
Penguin, 1989, 400 pages
$10.88 paperback

During the 1970s and ’80s, workaholic billionaire Michael Milken at Drexel used junk bonds, among other inventive tools, to fuel a generation of corporate raiders. In once scene, Milken raised $1.5 billion in 48 hours to finance Carl Icahn’s takeover bid for Phillips Petroleum. In 1988, the SEC charged Milken and Drexel with insider trading and stock fraud, and the U.S. district attorney followed with criminal charges.

The author Bruck, then a reporter for American Lawyer magazine, tells a good story, but her marshalling of evidence against Milken is sloppy. Drexel claimed, after the book was published, that it had not been given enough time to review the manuscript and respond to numerous errors before the book was rushed into print.

Wall Street (20th Anniversary Edition, 2007)
Starring Charlie Sheen, Michael Douglas, Daryl Hannah, Sean Young
Directed by Oliver Stone
20th Century Fox, original release 1987, 126 minutes
$13.99 for DVD

Bud Fox (Charlie Sheen) is a bright, blindly ambitious young Wall Street broker who, on the strength of an insider tip, gains a spectacular career and a trophy girlfriend (Daryl Hannah), but loses his soul. It’s also about Fox’s mentor, the ruthless Gordon Gekko (Michael Douglas), a corporate raider whose definition of “rich” is having your own jet. Oliver Stone, the director, “gives us a tantalizing peek into the boardrooms and bedrooms of the rich and powerful,” wrote Vincent Canby in a review. Douglas plays Gekko with wit and charm, eliciting cheers when he says in a speech to stockholders of a takeover target that greed is what made America great.

Stone condemns “a system that creates paper profits at the cost of diminishing products, services, and jobs,” wrote Canby. “But ultimately, his wit fails him. The movie crashes in a heap of platitudes that remind us that honesty is…the best policy.”

Douglas won an Academy Award for best actor in this role. Hannah earned a Razzie for worst supporting actress.

Click on the book images for details or to purchase.

The Visual Investor: How to Spot Market Trends (Second Edition)
By John J. Murphy
Wiley, 2009, 336 pages
$26.37 hardcover

Written for “the average CNBC viewer,” this book helps investors understand and interpret the ups and downs of stock, bond, and fund prices by studying the charts. Murphy covers the fundamentals, including chart types (trendlines, moving averages, price gaps, reversal patterns, interest spreads, etc.), market indicators, sector analysis, and global investing. He also introduces readers to intermarket analysis, an analytical approach that he pioneered based on understanding the impact that all the different markets have on each other. The author is the former host of CNBC’s “Tech Talk.”

Technical Analysis: The Complete Resource for Financial Market Technicians
By Charles D. Kirkpatrick and Julie R. Dahlquist
FT Press, 2006, 704 pages
$53.30 hardcover

Using over 200 illustrations, the authors explain the theory of technical analysis, presenting academic evidence both for and against it. They reveal which chart patterns and indicators have been reliable, show how to test new systems, and demonstrate how technical analysis can be used to mitigate risk. They also present a complete investment system and portfolio management plan, using tools such as tested sentiment, momentum indicators, seasonal affects, and flow of funds. Kirkpatrick has used technical analysis for decades to advise major investing institutions, and he currently teaches the subject to MBA candidates. Dahlquist is a university finance instructor and chartered market technician.

How Technical Analysis Works
By Bruce M. Kamich (N.Y. Institute of Finance)
Prentice Hall, 2002, 320 pages
$26.40 hardcover

The author, a chartered market technician and journalist, explains how to read charts and use them to identify trends, in the pursuit of buying low and selling high. His approach, which works best in a volatile market, “can be used as a timing tool, a selection tool, and, most important, a risk management tool.” Kamich explains technical analysis’s drawbacks as well as advantages. He has over 30 years of experience as a technical analyst, trader, and broker, and served on the board of the International Federation of Technical Analysts.

Getting Started in Chart Patterns
By Thomas N. Bulkowski
Wiley, 2005, 320 pages
$13.57 paperback, $9.99 Kindle

Bulkowski opens with a basic discussion of chart pattern formation and how bad habits can hurt trading. He then moves on to introduce over 40 key chart formations and numerous trading tactics that can be used in conjunction with them. He is the author of Encyclopedia of Chart Patterns (Wiley, 2005).

Yes, You Can Time the Market!
By Ben Stein and Phil Demuth
Marketplace Books, 2003, 208 pages
$16.95 paperback

The common wisdom on Wall Street says market timing doesn’t work. But Stein and Demuth sifted through a hundred years of stock market data and discovered that fundamental valuation metrics clearly reveal when the market is over- or under-priced. In fact, timing the market is just a matter of patience, which many Wall Street traders don’t have.

The authors demonstrate that basic criteria like dividend yield and price-to-earnings ratio can tell you when it’s a good time to jump into an index fund, the stock market, or when you’d be better off putting your money in bonds, real estate, or cash. They claim that an investor using their system would have bought stocks in 15 out of 15 of the best investing years for long-term investors since 1926, while staying out of the market during the worst 15 years. Economist, fiction writer, and TV personality Stein has written for The Wall Street Journal, Barron’s, The Washington Post, and E! Online. DeMuth, an “investment psychologist,” has also written for WSJ and Barron’s, as well as Human Behavior and Psychology Today.

Click on the book images for details or to purchase.

The End Of Globalization: Lessons from the Great Depression
By Harold James
Harvard University Press, 2002, 272 pages
$23.50 paperback, $9.99 Kindle

Globalization is not inexorable or irreversible. It is fragile. That is the message of The End of Globalization. It is written mainly for policymakers, economists, and scholars. But it is valuable for anyone who wants to understand the cyclical waxing and waning of globalization. James, a professor of history and international affairs at Princeton, points out that “there already have been highly developed and highly integrated international communities that dissolved under the pressure of unexpected events.” For example, the globally integrated world collapsed in the Great Depression, partly as a result of protectionist backlash, the failure of central banks, and immigration legislation. See any parallels in today’s world?

The Creation and Destruction of Value: The Globalization Cycle
Harold James
Harvard University Press, 2009, 336 pages
$13.57 hardcover

James further explores the similarities and differences between the financial panics of 2008 and the early 1930s (especially the huge bank failures in Austria and Germany in 1931), and points out that financial crises provoke backlashes against global integration—not only against the mobility of capital and goods, but also against immigration. The world that emerges from the current recession, James says, will be shaped largely by China’s rise as a global power and America’s decline.

Why Your World Is About to Get a Whole Lot Smaller: Oil and the End of Globalization
By Jeff Rubin
Random House, 2009, 304 pages
$17.16 hardcover, $9.99 Kindle

Rubin, an internationally renowned energy expert who lives in Toronto, predicts that oil prices will skyrocket again once the economy recovers. Consequently, the amount of food and other goods we get from abroad will be curtailed. Globalization as we know it will reverse. The good news for the USA: American industries, such as steel and agriculture, will be revitalized. Rubin prescribes priorities for President Obama, such as investing in mass transit. Rubin is the chief economist at CIBC World Markets.

Brave New War: The Next Stage of Terrorism and the End of Globalization
By John Robb
Wiley, 2008, 224 pages
$10.17 paperback

Counterterrorism expert Robb reveals how the same technology that has enabled globalization also allows terrorists and criminals to join forces against larger adversaries. For example, they could inexpensively sabotage oil pipelines, disrupt the global financial markets, and shut down electronic networks to retard the flow of information–destroying worldwide economic and cultural integration. Robb makes suggestions for safeguarding against this new method of warfare.

Related review
The World Is Curved: Hidden Dangers to the Global Economy,
By David M. Smick

Click on the book images for details or to purchase.

The Intelligent Investor: The Definitive Book on Value Investing
By Benjamin Graham, Jason Zweig, and Warren E. Buffett
Collins Business 2003, 640 pages
$14.95 paperback, $9.99 Kindle

Originally published in 1949, this book is not for seekers of quick returns. It is for disciplined, long-term investors who are willing to do the deep research required to find stocks that are bargain-priced relative to current asset value. Value investor Warren Buffet, who (along with Money editor Jason Zweig) contributed to this updated edition in 2003, calls it “the best book on investing ever written.”

Getting Started in Value Investing
By Charles Mizrahi
Wiley 2007, 190 pages
$13.57 paperback

Writing in an accessible style, Mizrahi helps readers understand the value approach to investing, presents statistics that reveal the overwhelming success of this approach through a variety of markets, and shows readers how to look for undervalued companies. Keys to finding such companies include:

• Looking for businesses that have an enduring competitive advantage
• Analyzing the difference between price and value of a stock
• Mining financial statements for valuable insights

Mizrahi is managing patner of CGM Partners Fund and editor of the Hidden Values Alert newsletter.

Unconventional Success: A Fundamental Approach to Personal Investment
By David F. Swensen
Free Press 2005, 403 pages
$21.60 hardcover, $16.50 Kindle

Incontrovertible evidence shows that most mutual funds are poor long-term investments. They may be OK for lazy investors, but for those who are willing to play an active role in managing their portfolios, there are more rewarding alternatives. Swensen (CIO of Yale University) recommends a well-diversified, equity-oriented “market-mimicking” portfolio of stocks, balanced with not-for-profit funds (with “client-oriented” fund managers) like TIAA-CREF.

Click on the book images to see more details or to purchase.

The World Is Flat: A Brief History of the Twenty-first Century (Updated)
By Thomas L. Friedman
Picador 2007, 672 pages
$10.88 paperback, $9.99 Kindle

The ironic title helped to make this a huge best-seller, but a more apt one would be “The World is Connected.” Friedman’s main premise is that Globalization 3.0, as he calls it, is driven not by major corporations or giant trade organizations like the World Bank, but by desktop freelancers and innovative startups all over the world (especially in Asia). Thanks to technological advances in such areas as Internet telephony, collaborative websites, open-source software like Linux, and ubiquitous connectivity (as well as lowered trade barriers), feelancers and startups anywhere in the world can compete not just for low-wage manufacturing and IT labor but, increasingly, for high-end scientific and legal research, engineering, programming, and design work as well.

The outsourcing and offshoring trends are unstoppable and desirable, even exciting to the optimist Friedman. Americans should adapt rather than protect: prepare to “create value through leadership.” The 2007 edition is updated with info about the political roots of global Islamism.

The World Is Curved: Hidden Dangers to the Global Economy
By David M. Smick
Portfolio 2008, 320 pages
$10.51 hardcover, $9.99 Kindle

Smick refutes Friedman’s description of the “flat” world produced by globalization, arguing instead that political resistance to globalization, retaliatory protectionism,  a lack of transparency in the global financial markets, and overheated economic development in China, among other conditions, have created a world where events and their consequences are unpredictable. The author writes clearly, illuminating complex subjects for general readers. Smick was an economic adviser to central bankers and legislators for some 30 years. (Derived from Publishers Weekly and School Library Journal reviews.)

Hot, Flat, and Crowded: Why We Need a Green Revolution—and How It Can Renew America
By Thomas L. Friedman
Farrar, Straus 2008, 448 pages
$9.78 hardcover, $9.99 Kindle

The USA has become a “subprime nation that thinks it can just borrow its way to prosperity,” says Friedman (him again). Nevertheless, the U.S. market is the “most effective and prolific system for transformational innovation.” Although professedly a proponent of the free market, he still advocates using government to create conditions favorable to investment.

One of those conditions is a cleaner global environment. We need alternate energy sources, and stronger conservation and recycling programs–a green revolution. We need to achieve greater energy independence to counter the “petrodictatorship” threat from the Middle East.

But one of the biggest threats, Friedman warns, comes from within: America’s loss of focus and national purpose since 9/11/01. Whether or not you agree, Friedman’s book is entertaining, with vivid anecdotes—this man has been around the block.