This extremely useful book provides clear, not-overly-mathematical, explanations of topics like risk, risk vs. reward, risk measurement, standard deviation applied to investment performance, portfolio construction, and correlation of asset classes.  I’ve long been a believer in holding a diversified portfolio of index funds, but this book has given me some tools to use to make better choices.  On the basis of Bernstein’s advice I plan on tilting my stock holdings toward small-cap and value index funds.

It was interesting to read this book – written in 2000 – in light of the recent crash.  Most of what he wrote back then is good advice, advice that would have cushioned anyone who followed it from the worst of the recent meltdown.

“The Intelligent Asset Allocator” is a good book to pick up after reading Bogle’s “Common Sense on Mutual Funds” (updated 10th anniversary edition), which is a book everyone who has any interest in investing should read before committing a penny.  Bernstein builds on Bogle but provides more actionable advice.

I did skim Bernstein’s more recent “The Investor’s Manifesto: Preparing for Prosperity, Armageddon, and Everything in Between”.  While it’s worth looking it, I don’t think it rewards a careful read like “he Intelligent Asset Allocator” does.

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This is a absorbing, discursive book about “Moby Dick”, Herman Melville, history, natural history and, yes, whales.  More history than natural history, it still contains plenty of fascinating cetacean facts.  Hoare concludes with a moving account of his close encounters with whales while filming the companion BBC documentary.

“The Whale” is beautifully written.  I really enjoyed this one.

Full disclosure: I’ve read “Moby Dick” twice and have an Arthur Moniz print of  Moby Dick’s moonlit flukes with the “Pequod” in the background hanging over my desk (see “The Chase” here).

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Michael Lewis, author of “Liar’s Poker“, returns to Wall Street to tell the story of the big crash.  He focuses on several people who were smart enough to short (i.e., bet against) the housing bubble. On almost every page I found myself amazed at just how crazy things were.  Even the subjects of the book found themselves wondering if they’d missed something as the bubble got bigger and bigger and they seemed to be the only ones in the casino who realized that it was already burning down around the gamblers.  If any book every proved that truth is stranger than fiction, this is it.

This is a great read full of interesting people doing arcane things while making and losing billions of dollars.  Lewis does a good job of explaining how the whole corrupt system worked.

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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.

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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.

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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.

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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.

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This is the story of the founding and early years of the Prediction Company, an early-90′s pioneer in computerized market analysis.   The book is a a typical startup tale.  It’s good reading if you like that sort of thing, which I do.  The question that’s never quite answered is, “were their models accurate, or lucky?”  The main characters (some of who also appeared in Bass’s excellent “The Eudaemonic Pie“) are pioneers of chaos theory and were attempting to apply their mathematical concepts to the possibly random, possibly chaotic, possibly manipulated world of finance.

Although not a technical book, “The Predictors” does contain some cautionary tales for people attempting to apply computer modeling to the markets.  It’s also interesting to see the seeds – in this 1999 book – of our current derivative-generated recession.

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This is a pretty good history of the origins of blogging.  There are some good stories here, and Rosenberg does a particularly good job on the history of political bloggers.  He tends to ignore tech bloggers and has far too little to say about RSS and RSS readers.  His analyses of “what it’s becoming” and “why it matters” have far less substance than the historical parts of the book though he has some interesting observations on the interaction of blogs and traditional media.

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Six hundred pages of very similar interviews with prominent software developers would probably put most people to sleep.  As a programmer with three decades of experience, though, I found this pretty fascinating.  The book has it’s faults: the interviews don’t seem very interactive -  Seibel seems more interested in his prepared questions then in following up on interesting things his subjects mention.  It’s also biased towards the craft’s elder statesmen.  That’s not entirely bad, especially when the old guys’ opinions agree with mine.  For example, many of them are not fond of IDE’s, think C++ is an abomination, have little interest in Java, and some shun debuggers.  OK, I’m a dinosaur.

Many of the interview subjects equate programming more with literature than with math or even science, something I’ve long thought to be the case.  Writing code and writing prose seem to use the same parts of the brain.  It has never seemed odd to me that the father of Perl,  Larry Wall (who is notably absent from “Coders at Work”), was a linguistics major.

This would be an excellent book for somebody considering taking up the software trade.  It’s also a good book for people who want an “inside baseball” look at software development.

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Like Polsky’s first memoir (“I Bought Andy Warhol“), this book consists mostly of anecdotes about the world of contemporary art.  During the time covered in this volume, Polsky made the transition from dealer to “art financial advisor”.  Consequently,  it’s more about dollars than art, but it’s an interesting read nevertheless, albeit a little impersonal compared to his first book.

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This memoir is an amusing series of anecdotes about the art business of the 80′s loosely organized around the author’s quest for a Warhol painting that he could afford.  I’m not a Warhol fan and not fond of modern art, but I enjoyed Polsky’s stories, many of which left me wondering how some of of these dealers manage to stay in business.  It’s about buying, selling, dealing, partying, and posturing.

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This retracing of Thoreau’s 1839 boat trip sounded promising, but I really didn’t enjoy it.  If my copy had been a library book I would have returned it unfinished, but since I had received it as a gift (at my own request) I felt obligated to finish it.  By the second chapter I was already sick of Leff’s monotonous repetition of the phrase “deep travel”, not to mention the wooden – and, I suspect, made up – dialog he stuck in the mouths of his traveling companions, who must have been terribly embarrassed by the way he portrayed them.

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For about 10 years John Drewe sold dozens of fake paintings in the English art market.  The art was the work of his partner-in-crime,  John Myatt, a failed painter.    The frauds all had a history, or “provenance”, consisting of bills of sale, exhibition catalogs, and correspondence recording their passage through time.  It’s provenance that seals the value of a work of art, and  Drewe was smart enough to realize that a provenance that looked authentic would cover up any anachronisms or faults in Myatt’s painting.  Drewe, posing as a philanthropist, gained access to museum archives in Britain and not only removed material that he used for forge documents, but inserted material so that a prospective buyer of one of Myatt’s fakes would, on researching the work’s history, find an impeccable pedigree.

“Provenance” is the story of Drewe’s criminal scheme which not only defrauded collectors and dealers but which polluted the history of art by his meddling in the archival records.   Myatt co-operated with the authors, and the sections on his part of the crime are vivid.  Drewe didn’t talk to the authors (and probably would have lied if he had), so his part in the story is fuzzier.  I was left with the feeling that there is a lot more to this story (for example, Drewe’s real past and the mentioned-in-passing works sold by Drewe but not painted by Myatt) than the authors were able to dig up.

In addition to being a good story, it raises questions about the market’s valuation of art, for if buyers are happy with a work, why should its history matter so much?

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In this small volume, the author of “Memoirs of a Book Snake” recounts some of his experiences collecting books on stage magic.  It’s a pleasant read for someone who likes books about books (as I do) but the most interesting parts are his stories of visiting now-vanished magic stores.

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This is a history of stage magic.  More preciously, it’s the story of certain large stage magic illusions that, mostly, use mirrors.  Now I know what the phrase “it’s all done with mirrors” really means.

Steinmeyer’s attempt to use Houdini’s disappearing elephant as the mystery that structures the book doesn’t work very well:  the book reads like a series of loosely-connected essays.  The author is at his best when describing specific magic acts, making it possible to imagine yourself in the audience of many famous magicians of the past.  Also interesting are his descriptions of how magic changed with the end of vaudeville as well as his repeated but always well-illustrated point that it’s the presentation, not the “secret”, that makes for a great illusion and how a well-conceived and executed trick is as much a psychological manipulation as a mechanical invention.

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