As hard as it is to believe, summer is once again drawing to a close, so it does seem a bit odd calling this blog my summer reading list. And despite the fact that very few of us actually got what we would normally call a true ‘summer’, in an effort to diverge from some of the more serious topics we’ve been addressing of late, I’m doing it anyway. This time around, I am focusing purely on financial titles since that’s the area we get asked about most frequently. The following list begins with some of the old standards that anyone curious about investing should look into, and then moves on to a few newer releases that I’ve enjoyed recently, so hopefully there’s something in there for everyone.
- Simple Wealth, Inevitable Wealth – Nick Murray
As many of you know, Nick Murray is one of our heroes around here. Murray has a way of saying so many of the things we believe about investing, in such a clear, concise and humorous manner, that we have long been drawn to his writing and speaking. As a result, our clients may very well feel a bit of de-ja-vu, while reading his books. His book, “Simple Wealth, Inevitable Wealth” is a bit more whimsical and less academic then some of the other ‘standards’, but nonetheless, it is a wonderful read, full of both great advice and anecdotes. Nick Murray gives his unflinching and unapologetic argument on why most investors fail, and what can be done to change this outcome. Murray is no fan of the media and its never-ending agenda of bad news, and clearly explains why “time in the market” is so much more important than “timing the market”. He goes on to explain why he believes stocks are really the only way to invest for the long-term, while bonds, good for “anxiety management”, are not really geared for wealth accumulation. Nick Murry is on-point and very funny (in a grumpy-old man kind of way), and I guarantee you will enjoy this one.
- Stocks for the Long Run, Jeremy Siegel
“Stocks for the Long Run” is one of those old standards, much like a Gershwin or Ellington tune, which, while classic, always manages to stay relevant and withstand the test of time. Written by Wharton School of Business professor Jeremy Siegel, this book was one of the first finance books both Jarret and I ever read, and if you are a client of ours, you will likely hear many echoes of our conversations through the years. Whether you are new to investing, or a long-time professional, this is a must-read. In the most recent edition of this book you will learn how stock markets have performed in both the short and long-term, the main contributing factors to long-term investing success, why diversification matters, what caused the 2008 financial crisis, and much more.
- The Behaviour Gap: Simple Ways to Stop Doing Dumb Things with Money, Carl Richards
Carl Richards is best-known for his Sketch-Guy column in the New York Times, and most of you will have seen at least one of his finance-related sketches at one time or another. We have been known to post them from time to time on our various social media platforms because he is brilliant at capturing the essence of complex financial issues in such simple and relatable ways. As a Certified Financial PlannerTM, Richards become so frustrated watching his friends and clients allow emotions to cause them to make the same mistakes over and over again, he coined the term “The Behaviour Gap” to illustrate the difference between the things we should be doing, and the things we actually do in investing. He goes in-depth discussing the dangers of blaming markets or the economy for our investing failures; why it is so important to rethink all kinds of situations where your perfectly natural instincts (for safety or success) can cost you money and peace of mind; why you should quit spending money and time on things that don’t matter and identify your real financial goals to simplify your financial life and stop losing money. And his sketches are really cool!
- The First Tycoon: The Epic Life of Cornelius Vanderbilt, T. J. Stiles
A biography of the Vanderbilt dynasty’s patriarch, Cornelius Vanderbilt, written in 2009, The First Tycoon won a Pulitzer Prize for Biography or Autobiography in 2010. This exhaustive biography about the shipping and railroad magnate, who founded Vanderbilt University, describes Vanderbilt’s life from his 1794 birth to his death in 1877, shedding light on his leadership in expanding railroad transportation into a revolution and establishing the modern corporation. Despite its length, The First Tycoon is surprisingly fast-moving, and is an interesting deep dive into the life of such a complex man who is so intertwined in the building of America.
- The Undoing Project: A Friendship That Changed Our Minds, Michael Lewis
Michael Lewis’ 2016 book about Israeli psychologists Daniel Kahneman and Amos Tversky, and their groundbreaking work on heuristics in judgment and decision-making, which led to a Nobel Prize in economics, may be my favorite Lewis book to date. While the two men are largely considered the fathers of modern behavioral finance, which obviously appeals to my nature, dedicating an entire book to their work on a bit of an arcane subject that was completed over 30 years ago might seem like a stretch. While he does provide a basic primer on their research, Lewis’ book is really about their relationship and close partnership and how that partnership ultimately broke apart. Lewis weaves a compelling tale about the lives and working relationship of two brilliant and complex men who shaped the world of economics, finance and psychology forever.