Christmas is coming, so it’s time for all right-thinking blogs to publish a random list of books in the hope of generating enough income to throw another log on the fire (or at least buy some more books). These days it’s hard to actually see out of the thicket of new books on the topic behavioral finance, a deluge inversely proportional to the actual impact of behavioral economics on the real world, other than through the dubious delights of default choice. If we think a bit wider, though, as a liberal arts investor, there are a few books people shouldn't die not having read.
Following Charlie Munger’s dictum :
“Wisdom acquisition is a moral duty. It’s not something you do just to advance in life. As a corollary to that proposition which is very important, it means that you are hooked for lifetime learning. And without lifetime learning, you people are not going to do very well. You are not going to get very far in life based on what you already know.”
The Ascent of Man; Jacob Bronowski
This book, which accompanied the 1970’s BBC series of the same name, is required reading for anyone without a degree in everything. It’s a glorious romp through human history which packs in enough information to leave you spending a lifetime following it up.
As we've seen here time and again the world of investing spins off into many different areas of human knowledge; the collection of which constitutes Munger’s latticework of mental models. The underpinning for much of that knowledge can be found in the Ascent of Man: everything from the growth of Islamic mathematics through religion, to the development of perspective in art through to an explanation of special relativity and the development of Game Theory through first hand experience of Johnny von Neumann (see: Games People Play).
It’s a great book, but it’s scary as well: so much to learn, and so little time left to do it in.
The Ascent Of Man
The Drunkard’s Walk; Leonard Mlodinow
OK, so it’s about statistics. Sadly so is a lot of investing, and if you can’t interpret the things then you’ll end up banging your head against gut feelings. Our…
