Reader’s Diary

Russell Roberts

Two high school teachers, a libertarian and a liberal, fall in love against a background of corporate fraud.  Interesting, until it’s revealed that the corporate fraud is a fiction-within-a-fiction, the plot of a popular TV show that exists only to show how stupid the liberal’s liberal friends are.  At this plot turn it becomes obvious that this is nothing more than a libertarian parable.  You might enjoy it if you’re one of those naive fools who thinks that markets are the solution to all our problems.   Russell can safely spout this nonsense, since he’s a presumably-tenured professor insulted from the depredations of the corporate oligarchy.  The real world never has and never will fit the libertarian pipe dream.

Frank Gohlke

This is a collection of short pieces by and interviews with photographer Frank Gohlke.  Some of the chapters are more useful then others, and there is some repetition, but most of them have insightful things to say about landscape, particularly the problem of presenting nature as it exists in the man made environment (a theme that Gohlke convincingly argues was a concern of Thoreu’s).

It’s hard to find books that talk sensibly about non-technical and non-historical aspects of photography.  This is one of those rare books.  While it’s not quite as widely applicable or as tightly edited at Robert Adams’ “Beauty in Photography“, it belongs next to it on the shelf.

Robert Conroy

This is a competent alternate history in which the US and the USSR go to war over the remains of Germay at the “end” of WW II.  The plot has few surprises, but it was plausible enough and written well enough to draw me in and keep me interested.

Nassim Nicholas Taleb

Considering that I called Taleb’s previous book “a double-barreled time-waster”, it’s odd that I read this one at all, much less that the ideas in it obsessed me for a couple of weeks.   Maybe a nine month period of unemployment which started four months after I read his last work changed my perspective.  Certainly “The Black Swan” owes much of its popularity to the good fortune of having been published only a short while before the global economic meltdown.

“The Black Swan” is about the idea that there are unpredictable events – “black swans” –  that can have huge consequences.   To a lesser extent, it’s about how to arrange things so that you are relatively unaffected by the inevitable but unpredictable catastrophes that lurk in our future.  This isn’t a financial advice book but Taleb does argue for putting 80% of one’s savings in cash and 20% in high-risk bets that have the potential of big payoffs.  However, once you’ve accepted his argument that bad things can happen, what can you really do about it?  Should we really devote our lives to avoiding risk?

Taleb is an engaging writer, and this is a thought-provoking book (and heaven knows thought-provoking books are themselves black swans).  He makes a very good case for the idea that our interconnected, automated world puts increasingly at the mercy of black swan events.

This book might change the way you look at the world, but it won’t help you sleep at night.

William Poundstone

This book is about the “Kelly formula” (explained on the author’s web site) which, despite the book’s subtitle, is not so much a betting system but a money management system for gamblers.  It also applies to stock market investing, which says something about the nature of the market vs. the casino.

The Kelly formula is based on the observation that even a gambler with inside information that gives him a substantial edge – or the investor who succeeds in identifying “inefficiencies” in the market – can go broke if he dumps all his money into a enough bets that don’t turn out as expected.  The formula gives the gambler/investor a way to determine  just how much of his stake to place on each bet/investment. By applying the formula he can maximize his profit at the cost of volatility.  The volatility can be reduced by betting at “less than Kelly”,  a precaution that also allows for errors in the bettor/investor’s estimate of the numbers that are the inputs to the formula.

Poundstone explains the Kelly concept in non-mathematical terms and tells the stories of people who developed it and used it.  In the course of the book he introduces the reader to scientists, gamblers, mobsters, and investment gurus (and charlatans).  The connective thread is the story of  Edward O. Thorp who famously “Beat the Dealer” at blackjack and less famously “Beat the Market“.

All in all, it’s an interesting book taught me a little about a lot of areas I knew little about.  I do wish Poundstone had focused more on the estimates on which the formula depends and on concrete examples of how the average investor – or gambler – might apply the formula.

Danny Wallace

As I’ve said before, Danny Wallace is a funny guy.  This very short book is about his trip to Wallace, Idaho, the self-proclaimed center (or centre, if you’re from the U.K.) of the universe.  It’s amusing, but the topic is too limited and the book too short to provide much scope for his talents.