Book Reviews – Page 25 – The Aleph Blog

Book Review: The Heretics of Finance

Posted on 21 January 200912 February 2011 by David Merkel

I’m not against technical analysis per se, at least not anymore.? I don’t think I understand it well, but after reading The Heretics of Finance, I’m not sure anyone really does.? Let me explain.

When I wrote for RealMoney, I often thought it was two sites in one.? Technical analysts on one side, and Fundamental analysts on the other.? Little interaction, except to snipe at each other every now and then.? I’m happy to say that I stayed above the fray, because as a corporate bond manager, technical analysis helped me manage market risk better.? I wasn’t sure how to apply it to equities, though, particularly post-decimalization.

I posted something like this three times on RealMoney, and aside from one private response from Helene Meisler, no one ever bit on my questions regarding technical analysis:

		David Merkel
		The Two Questions on Technical Analysis
		2/22/2008 12:15 AM EST

I received some e-mails from readers asking me to post the questions that I mentioned in the CC after the close of business yesterday. Again, I’m not trying to start an argument between fundies and techies. I just want to hear the opinions of the technicians. Anyway, here goes:

1) Is there one overarching theory of technical analysis that all of the popular methods are applications of, or are there many differing forms of technical analysis that compete against each other for validity (and hopefully, profits)? If there is one overarching method, who has expressed it best? (What book do I buy to learn the theory?)

2) In quantitative investing circles, it is well known (and Eddy has written about it recently for us) that momentum works in the short run, and is often one of the most powerful return anomalies in the market. Is being a good technician just another way of trying to decide when to jump onto assets with positive price momentum for short periods of time? Can I equate technical analysis with buying momentum?

To any of you that answer, I thank you. If we get enough answers, maybe the editors will want to do a 360.

Position: none

That’s where I’m coming from.? In The Heretics of Finance, I received half an answer to my first question, and no answer to my second question.? Now, I enjoyed the book a great deal; it is well-designed.? The book begins by interviewing thirteen well-known technical analysts:

Ralph J. Acampora
Laszlo Birinyi
Walter Deemer
Paul Desmond
Gail Dudack
Robert J. Farrell
Ian McAvity
John Murphy
Robert Prechter
Linda Raschke
Alan R. Shaw
Anthony Tabell
Stan Weinstein

Each chapter asks them a bevy of similar questions.? As I read the first thirteen chapters, my growing conclusion was many of them all do different things, but they all call what they do technical analysis.? I did get a half answer to my first question, in that many of them pointed to the books, Technical Analysis of Stock Trends, 8th Edition, and Technical Analysis of the Financial Markets: A Comprehensive Guide to Trading Methods and Applications (New York Institute of Finance) to a lesser extent, as definitive (and large) reference books on TA that give what they think is the overarching theory.? So, maybe I have an answer to my first question, but I’ll have to buy the books to understand it.

The next seven chapters ask all of the interviewees the same questions, allowing them to agree or disagree with each other.? The questions were asked to each person separately, in interviews from 2004-2005.? It would have been more interesting to have them all in one room, so that they could debate more, and question each other.

That said, many of the questions were interesting:

Does lack of academic support bother you?
Can TA be learned from books, or only through experience?
Are there universally valid TA rules?
Is it an art or a science?
How big of a role does luck play?
Do those that incorporate astrology into TA harm the discipline?
How much can TA be mechanized?

In the introduction, the authors, Lo and Hasanhodzic saw increasing acceptance of TA by academics, sometimes directly (challenging the weak form of the efficient markets hypothesis), or via behavioral finance (how value investors do TA).

There was no answer to my second question, as to whether TA is just a way of implementing a momentum strategy.? Surprising to me, Lo and Hasanhodzic did not think to ask the question.? (My opinion: aside from a few technicians that like to try turning points, yes, TA is a way to implement momentum investing.)

Who Would Benefit from this Book

If you want a taste of a wide number of accomplished technicians, this book will give you that.? It wilol also give you jumping-off points into TA literature and TA-friendly academic work describing Technical Analysis.? If you are into some of the main characters in TA, this tells their stories, and elucidates the attitudes of disciplined appliers of TA.

You can buy it here:The Heretics of Finance: Conversations with the Leading Practitioners of Technical Analysis.

PS — Not many book reviewers read the books that they review.? They read the summary that the PR flacks send, and rely heavily on that.? I throw away those summaries, and read the books.? That takes time, but I like reading books, and when I wrote for RealMoney, I often missed reading books.? Now I read them more, and you can benefit from that, because I don’t always endorse the books that I review.

I don’t have a tip jar, but if you buy anything through Amazon, after entering through a link on my site, I get a small commission, and your costs don’t go up.? I like taking? the fees out of Amazon, and not out of my readers.

Book Review: Dear Mr. Buffett

Posted on 10 January 200911 January 2009 by David Merkel

This is not your ordinary Buffett book.? In one sense, that is because it is not a Buffett book.? When I read other early reviews on the web, I concluded that they hadn’t read the book.? I read almost all of the books that I review at my blog.? If I have not read the book, but have skimmed it, I tell you so in the first few paragraphs.? I also purposely avoid reading the stuff that the PR flacks include with the books.? I find it fascinating how many reviewers rely on the crutches provided.

Why is this not an ordinary Buffett book?? Because it concerns how an expert on derivatives came to know Mr. Buffett, and how the current crises were seen in advance by both of them.? This book’s greatest strength comes from its ability to explain the messes we are currently in.? No solutions, mind you, and Mr. Buffett ain’t handing out any of those either, but understanding how we got to where we are is of value, and Janet Tavakoli is nothing if not a good writer on those points.

There is a second theme — how a derivatives expert came to appreciate value investing.? After all, when short term investing is focused on a variety of arbitrage situations, why not think long, and look for long term capital appreciation?

In the book, much of the current crisis gets examined up through September 2008.? Unlike many, she was right in advance on many of the topics that would eventually bite us:

CDOs
Subprime mortgages
Hedge fund underperformance
Failing Financial Guarantors
And more…

She also disses the overrated Nassim Taleb, saying that the current events are not a “black swan,” but predictable, given the overage of leverage.? I agree, having written about these thing before the bust hit, while still admiring Taleb’s focus on nonlinearity and feedback cycles.

Janet Tavakoli and Warren Buffett share a similar philosophy on derivatives.? That is what motivates this book.

How can they be a systemic hazard?
How might one use them properly?

I heartily recommend this book.? One reading this will understand our current crisis very well, and will gain in his understanding of how our markets work.? That said, the virtues of the book do not come from Mr. Buffett, but from one who intelligently admires his views on derivatives and other matters.

You can buy the book here: Dear Mr. Buffett: What An Investor Learns 1,269 Miles From Wall Street

PS — I write book reviews, and I hope you like them, because unlike other reviewers, I read the books.? I use Amazon because their service is good, and they offer a fair commision to those influencing those that buy through them.? My view is that if you need to buy something through Amazon, entering the site through one of my links will not increase your costs, and I will get a small commission.? Thanks to all who buy on Amazon through me.

Book Review: Rich Like Them

Posted on 7 January 2009 by David Merkel

Suppose you wanted to write a book about “how the other half lives.”? Well, make that how the 1-in-200 lives.? You could dig up statistics on the wealthy, chronicle those who are showy in our society, and write a book about the glamour of the well-to-do.

Now imagine that instead of doing that, you decided to start knocking on the doors of estates, and ask the owners how they achieved their august status.? For the one in four that humored your request you would learn some interesting truths that are pretty plebian.? That is the story told in “Rich Like Them.”

The author, Ryan D’Agostino spent time traveling through the 100 wealthiest zip codes in the US, getting stories from the wealthy that would give him time.? He tells the tales in the mode of a storyteller, loosely organized under five chapters, and teaching the following lessons:

Find opportunities that others don’t see.
So-called luck favors those who are prepared to profit from volatility.
Love what you do.? Do what you love.
Take risks.? If you work smart and hard, those risks will be reduced.
Be humble.? Realize what you can’t do, and work on what you can do.

The people he interviewed were in fairly ordinary businesses, but they conducted business in ways that added a lot of value to customers.? The interviews revealed many of them to be pretty ordinary people who were in the right place at the right time, but they put forth the effort that many would not, in order to build a successful business.

The book is discursive, structuring the story around his journeys, and around the lessons that he learned.? The author could have summarized more, as many books on business do, but given the way he decided to write the book, beating people over the head with the conclusions would not have fit the author’s style.

I liked the book, and would particularly recommend it to those that want to work for themselves, but have little idea of how to pursue that goal.

You can buy it here if you like: Rich Like Them: My Door-to-Door Search for the Secrets of Wealth in America’s Richest Neighborhoods

Three Long Articles on Three Big Failures

Posted on 31 December 200831 December 2008 by David Merkel

If you have time, there are two long articles that are worth a read.? The first is from the Washington Post, and deals with the demise of AIG, highlighting the role of AIG Financial Products.? It was written in three parts — one, two, and three, corresponding to three phases:

Growth of a clever enterprise, AIGFP.
Expansion into default swaps.
Death of AIG as it gets downgraded and has to post collateral, leading to insolvency.

What fascinated me the most was the willingness of managers at AIGFP to think that writing default protection was “free money.”? There is no free money, but the lure of “free money” brings out the worst in mankind.? This is not just true of businessmen, but of politicians, as I will point out later.

My own take on the topic involved my dealings with some guys at AIGFP while I was at AIG.? Boy, were they arrogant!? It’s one thing to look down on competitors; it’s another thing to look down on another division of your own company that is not competing with you, though doing something similar.

As I sold GICs for Provident Mutual, when I went to conferences, AIGFP people were far more numerous than AIG people selling GICs.? The AIG GIC sellers may have been competitors of mine, but they were honest, and I cooperated with them on industry projects.? Again, the AIGFP people were arrogant — but what was I to say?? They were more successful, seemingly.

The last era, as AIG got downgraded, was while I wrote for RealMoney.? After AIG was added to the Dow, I was consistently negative on the stock.? I had several worries:

Was AIGFP properly hedged?
Were reserves for the long-tail commercial lines conservative?
Why had leverage quadrupled over the last 15 years?? ROA had fallen as ROE stayed the same.? The AIG religion of 15% after-tax ROE had been maintained, but at a cost of increasing leverage.
Was AIG such a bespoke behemoth that even Greenberg could not manage it?
My own experiences inside AIG, upon more mature reflection, made me wonder whether there might not be significant accounting chicanery.? (I was privy to a number of significant reserving errors 1989-1992).

In general, opaqueness, and high debt (even if it’s rated AAA), is usually a recipe for disaster.? AIG fit that mold well.

Now AIG recently sold one of their core P&C subsidiaries for what looks like a bargain price.? This is only an opinion, but I think AIG stock is an eventual zero.? Granted, all insurance valuations are crunched now, but even with that, if selling the relatively transparent operations such as Hartford Steam Boiler brings so little, then unless the whole sector turns, AIG has no chance.? Along the same lines, I don’t expect the “rescue” to be over soon, and I expect the US govenment to take a significant loss on this one.

The second article is from Bethany McLean of Vanity Fair.? I remember reading her writings during the accounting scandals at Fannie Mae.? She was sharp then, and sharp now.? There were a loose group of analysts that went under the moniker “Fannie Fraud Patrol.”:? I still have a t-shirt from that endeavor, from my writings at RealMoney, and my proving that the fair value balance sheets of Fannie were unlikely to be right back in 2002.

Again, there is a growing bubble, as with AIG.? The need to grow income leads Fannie and Freddie to buy in mortgages that they have guaranteed, to earn spread income.? It also leads them to buy the loans made by their competitors.? It leads them to lever up even more.? It leads them to dilute underwriting standards.? Franklin Raines’ goals lead to accounting fraud as his earning targets can’t be reached fairly.

One lack in the article is that the guarantees that Fannie had written would render Fannie insolvent at the time the Treasury took them over.? On a cash flow basis, that might not happen for a long time, but it would happen.? Defaults would be well above what was their worst case scenario, and too much for their thin capital base.

The last article is another three part series from the Washington Post that is about the failure of our financial markets.? (Here are the parts — one, two, three.)? What are the main points of the article?

Bailing out LTCM gave regulators a false sense of confidence.? They relished the micro-level success, but did not consider the macro implications of how speculation would affect the investment banks.
Because of turf and philosophy conflicts, derivatives were left unregulated.? (My view is that anything the goverment guarantees must be regulated.? Other financial institutions can be unregulated, but they can have no ties to the government, or regulated financial entities.
The banking regulators failed to fulfill their proper roles regarding loan underwriting, consumer protection and bank leverage.? The Office of Thrift Supervision was particularly egregious in not doing their duty, and also the the SEC who loosened investment bank capital requirements in 2004.
Proper risk-based capital became impossible to enforce for Investment banks, because regulators could not understand what was going on; perhaps that is one reason why they gave up.
The regulators, relying on the rating agencies, could not account for credit risk in any proper manner, because the products were too new.? Corporate bonds are one thing — ABS is another, and we don’t know the risk properties of any asset class that has not been through a failure cycle.? Regulators should problably not let regulated entities use any financial instrument that has not been through systemic failure to any high degree.
Standards fell everywhere as the party went on, and the bad debts built up.? It was a “Devil take the hindmost” situation.? But as the music played, and party went on, more chairs would be removed, leaving a scramble when the music stopped.? Cash, cash, who’s got cash?!
In the aftermath, regulation will rise.? Some will be smart, some will be irrelevant, some will be dumb.? But it will rise, simply because the American people demand action from their legislators, who will push oin the Executive and regulators.

A few final notes:

Accounting rules and regulatory rules were in my opinion flawed, because they allowed for gain on sale in securitizations, rather than off of release from risk, which means much more capital would need to be held, and profits deferred till deals near their completion.
This could never happened as badly without the misapplication of monetary policy.? Greenspan enver let the recessions do their work and clear away bad debts.
Also, the neomercantilistic nations facilitated the US taking on all this debt as they overbuilt their export industries, and bought our debt in exchange.
The investment banks relied too heavily on risk models that assumed continuous markets.? Oddly, their poorer cousin, the life insurers don’t rely on that to the same degree (Leaving aside various option-like products… and no, the regulators don’t know what is going on there in my opinion.)
The insurance parts of AIG are seemingly fine; what did the company in was their unregulated entities, and an overleveraged holding company, aided by a management that pushed for returns and accounting results that could not be safely achieved.
The GSEs were a part of the crisis, but they weren’t the core of the crisis — conservative ideologues pushing that theory aren’t right.? But the liberals (including Bush Jr) pushing the view that there was no need for reform were wrong too.? We did not need to push housing so hard on people that were ill-equipped to survive a small- much less a moderate-to-large downturn.
With the GSEs, it is difficult to please too many masters: Congress, regulators, stockholders, the executive — all of which had different agendas, and all of which enoyed the ease that a boom in real estate prices provided.? Now that the leverage is coming down, the fights are there, but with new venom — arguing over scarcity is usually less pleasant than arguing over plenty.
As in my blame game series — there is a lot of blame to go around here, and personally, it would be good if there were a little bit more humility and willingness to say “Yes, I have a bit of blame here too.”? And here is part of my blame-taking: I should have warned louder, and made it clearer to people reading me that my stock investing is required because of the business that I was building.? I played at the edge of the crisis in my investing, and anyone investing alongside me got whacked with me.? For that, I apologize.? It is what I hate most about investment writing — people losing because they listened to me.

Book Review: Once in Golconda

Posted on 16 December 200812 February 2011 by David Merkel

When I think about the present market difficulties, I think about both the situation as a whole, and the personalities involved.? We might look at Bernie Madoff as a poster child for the current distress, but back during the Great Depression. we might have considered Richard Whitney.

Though the conditions are different, when conditions move from boom to bust, cheaters get revealed — those who were relying on good times in order to make good on promises gone wrong.? Both Madoff and Whitney had sterling reputations as well, and they both played a significant role in the trading of the market.

Perhaps big frauds require seemingly upright men who command trust from their peers.? Practices that can be gooten away with during a bull phase of the market will fall flat during the bear phase.

Aside from the Whitney story, Once in Golconda tells the story of boom and bust for the financial economy as a whole.? Taking chances ramped up, supported by a too-easy monetary policy.? After the peak, opportunities were few, and few had the spare capital to invest in ventures that were seemingly rich, as measured against boom conditions.? Such is the nature of scarce liquidity after a boom.

This is a fun book.? You can see the gathering storm as liquidity grows, and markets boom.? You can see the increasing furor nearing the peak.? At the peak, you can’t hear much.? During the fall you can hear investors go through the five stages of grieving as they watch their investments die.

This is a good book, well-written, and appropriate for our era.? I recommend it.

If you want to, you can buy it here: Once in Golconda (Wiley Investment Classics)

Book Review:Beat the Market: Invest by Knowing What Stocks to Buy and What Stocks to Sell

Posted on 13 December 200812 February 2011 by David Merkel

I am usually not crazy about books that propound a simple way to beat the market.? This is one of those books.? What makes me willing to write a review about this book, is that the writer, Charles Kirkpatrick is willing to incorporate some fundamental measures into his analyses, notably price-to-sales, which will help with industrial companies, but not with financials.

This is a simple book that reinforces the idea that one needs to pay attention to valuation (in a rudimentary way), and also to momentum.? While I don’t endorse the specific methods of the book, I will say that for someone with a low amount of time, and wanting to do a little better than the market averages, he could do so over the intermediate-term with the methods in the book.

Note: I am not endorsing the technical methods in the book, but most of the methods boil down to momentum, anyway.

If you want, you can find it here: Beat the Market: Invest by Knowing What Stocks to Buy and What Stocks to Sell

PS ? Remember, I don?t have a tip jar, but I do do book reviews.? If you enter Amazon through a link on my site and buy things from them, I get a small commission, and you don?t pay anything extra.? I?m not out to sell things to you, so much as provide a service.? Not all books are good, and not every book is right for everyone, and I try to make that clear, rather than only giving positive book reviews on new books.? I review old books that have dropped of the radar as well, like this one, because they are often more valuable than what you can find on the shelves at your local bookstore.

Book Reviews: The Complete Guide To Option Pricing Formulas, and Derivatives, Models on Models

Posted on 13 December 2008 by David Merkel

This is not my ordinary book review.? These are good books that will only appeal to a small fraction of my readers, because few will have need for the knowledge. Both are written by Espen Gaarder Haug, who is kind of a character.? He collects option pricing formulas the way some people collect Barbie Dolls, Beanie Babies, or Baseball Cards.? He has interacted with some of the brightest minds in the field, and collaborated with a few of them.? In both books the math is significant — it would help if your calculus was sharp, and for any value some algebraic knowledge is needed.

Let’s start with the more esoteric of the two books, The Complete Guide To Option Pricing Formulas.? Almost every option formula is included there, together with ways of estimating volatility, certain statistical techniques, aspects of compound interest math, etc.? The book is very comprehensive, and for those that need how to estimate the value of standard and non-standard options, it is a good book to keep on hand as a reference, together with the free CD-ROM containing an Excel add-in that allows you to use the formulas inside Excel.? I have used them for some of the insurance companies I have worked for; the software was easy and reliable.

The second book Derivatives, Models on Models, is different.? He interviews 15 significant thinkers on options and derivatives, and presents 15 papers by them.? Most of them contain tough math; some I couldn’t understand.? The real value of the book was in the interviews, where many of the interviewees showed significant knowledge of the limitations of their models, and how derivatives were misunderstood by the public, or by their users.

There are quirky aspects to this book, including cartoons and photos that are somewhat self-aggrandizing to the author, but make the point in a humorous way.? I liked both books, but only a modest fraction of my readers should have any interest here.

If you want it, you can find them here:

Derivatives Models on Models

The Complete Guide to Option Pricing Formulas

Book Review: Co-opetition

Posted on 28 November 2008 by David Merkel

Again, I don’t just do book reviews of new books.? I do reviews of new books, and older books that I think are significant.? One strategic management book that has helped me is Co-opetition.? Co-opetition is the use of both co-operation and competition in an effort to better your business.

Similar to Michael Porter’s Five Forces framework, Co-opetition aims to describe a business or industry as part of a broader system, and design business strategy through competition and alliances with other economic actors that affect your business.

That broader system is called the “value net,” and is composed of the firm in question, their customers, suppliers, competitors, and complementors.? Complementor was a term they created to describe those parties who produce products or services that help make your customers more likely to buy from you.? As the book describes it, think of hot dogs and mustard.

When I was a bond manager, I intuitively understood co-opetition.? Most managers/traders played the game very sharply, and argued for every basis point.? I realized that I had to be careful, and show that I was no pushover, but I found a variety of co-operative strategies that got my brokers working for me, not against me.

1) Helping them out when they were short a bond.? I did not sell my bonds to them cheaply, but I did not gouge their eyes out (a technical bond market term) either.? They were grateful to me, and Wall Street does have its own brand of loyalty.? It protects friends.

2) I let brokers know what I was up to in general, while reserving discretion.? I was more open than other managers, realizing that it would be hard to imitate what I was doing, and no one broker had the full picture.? I let brokers truly know what my motives were for selling a bond, whether it was relative value, or needing to raise cash.

3) My brokers knew that my word was my bond.? I did not break trades.? When I uttered the word “done” it did not change.

4) My brokers knew that I would give them frank feedback.? If they were way out of kilter with the market, I would give them one chance to change their position after I told them what I knew.

5) I would show “love” on occasions when they had badly mis-bid for my bonds.? I would give them back one-third of the difference between their bid and the second place bid.

That’s my main example from my own life.? When a large part of my competitors viewed brokers as their competitors, I viewed them more as suppliers, and tried to find ways to work with them, and not against them.

I also found ways when working in the Pension Division of Provident Mutual, to use our small size and flexibility as an advantage versus our larger rivals.? Understanding the competitive landscape was a real advantage, particularly in finding those that could aid us — where there would be mutual benefit.

I could write at length over the individual strategies in the book.? They are all significant, though only a subset applies at any given time.? The book gives a good strategic manager tools, and he has to decide which are relevant to his situation.

If you want it, you can find it here: Co-Opetition : A Revolution Mindset That Combines Competition and Cooperation : The Game Theory Strategy That’s Changing the Game of Business

Book Review: A History of Interest Rates

Posted on 24 November 200828 November 2008 by David Merkel

This book is big, very big at ~700 pages. It is a testimony to the idea that history doesn’t repeat itself, but it often rhymes.

The book is arranged chronologically, and geographically within each time period.? Time is spent on each are roughly in proportion to the amount of unique data that we have from each era.? Thus, the recent past gets more pages per year.? Roughly one-quarter of the book goes from ancient times to 1800, and one quarter to the 19th century.? Half of the book is 1900-2005.

There are several things that the book points out, common to each time and area investigated.

1) It is very difficult to eliminate interest.? Even when governments or religions try to restrict interest, either in rate charged or in entire, systems arise to create promises to pay more in the future that than full payment today.

2) The more technologically advanced economies get, the lower interest rates tend to get.

3) Boom/bust cycles are impossible to avoid.

4) Governments introduce currencies and often cheat on them (debasement, or inflation of a fiat currency).

5) Governments do sometimes fail, whether due to a lost war, civil war, or default, taking their currencies and debt promises with them.

6) The economic cycle across the world is usually more correlated than most people believe at any given point in time, even in ancient times.? (How much more today… decoupling indeed…)

7) Cultures that allowed for a moderate amount of debt financing prospered the most, in general.

Those are my summary points after reading the book.? Homer and Sylla drew some but not all of those conclusions.? It’s an ambitious book and and ambitious read.? Sidney Homer did a lot of significant work researching from the past to the middle of the 20th century, and Richard Sylla did an admirable job giving the grand sweep of the increasing complexity of the bond markets as the 20th century progressed until 2005, which was an interesting point at which to end the fourth edition.? The fifth edition, should there be one, will prove even more interesting as it surveys the end of the housing and credit bubbles, and the shape of the financial system in their aftermath.

This book is a must for those that like economic history.? I really enjoyed it.? For those without such an interest, it’s a big, somewhat-expensive, show-off book that will be occasionally useful as a reference.

If you want, you can find it here: A History of Interest Rates, Fourth Edition (Wiley Finance)

PS ? Remember, I don?t have a tip jar, but I do do book reviews.? If you enter Amazon through a link on my site and buy things from them, I get a small commission, and you don?t pay anything extra.? I’m not out to sell things to you, so much as provide a service.? Not all books are good, and not every book is right for everyone, and I try to make that clear, rather than only giving positive book reviews on new books.? I review old books that have dropped of the radar as well, like this one, because they are often more valuable than what you can find on the shelves at your local bookstore.

Book Review: How to Be the Family CFO

Posted on 22 November 200822 November 2008 by David Merkel

This review will be short, because my view of How to be the Family CFO, is mixed.? Let me start by saying that I preferred the book Easy Money, by Liz Pulliam Weston, because it had more concrete? advice than did Family CFO, by Kim Snider.

Also, I did not feel that I was being “marketed to” in Easy Money, but I did in Family CFO, particularly toward the end of the book, where the dividend-oriented Snider Investment Method (R), is discussed.? What put me off was the promotional nature of the writing, and the lack of detail, particularly any information on capital gains and losses from the strategy.? Definitely not Global Investment Performance Standards-compliant.? Also, the strategy would be undiversified, in my opinion, by being overexposed to income factors.

Now, there is one major positive to the book, a place in which it is superior to Easy Money.? It motivates the “why” of getting your financial life in order, while Easy Money is better with the “how.”? What I admire about the author is that after failure, she grew up, and learned to be a serious adult about planning for the future, and using money wisely.

Most of my readers I expect are good at handling their money, but perhaps you have family or friends with self-inflicted money troubles.? If they lack motivation, you could get them a copy of Family CFO (with my caveats).? If they have motivation but lack knowledge, you could give them Easy Money.

Both are available from Amazon:

How to Be the Family CFO

Easy Money: How to Simplify Your Finances and Get What You Want out of Life (Liz Pulliam Weston)