New Books in Finance

Deep new rifts are tearing apart the fabric of Britain and other Western societies: thriving cities versus the provinces; the high-skilled elite versus the less educated. As these divides deepen, we have lost the sense of ethical, reciprocal obligations to others that were crucial to the rise of post-war prosperity — and are inherently aligned with how humans are meant to live: in a friendly, collaborative community. So far these rifts have been answered only by ideologies of populism and socialism, leading to the seismic upheavals of Trump, Brexit, and the return of the far-right across much of Europe.Sir Paul Collier’s The Future of Capitalism: Facing the New Anxieties (Harper, 2019), winner of the 2019 Handelsblatt Prize, provides a diagnosis for how these anxieties have arrived, alongside a pragmatic and ambitious prescription for how we can address them. In our conversation, we trace these anxieties of 21st century capitalism back to their ethical, economic, and social roots and discuss ideas to rebuild reciprocal obligations in our society, paving the way to more sustainable, more kind, and more successful future of capitalism.Paul is currently Professor of Economics and Public Policy at the Blavatnik School of Government at the University of Oxford and a Director of the International Growth Centre in London. He is a world-renowned development economist, working with governments around the world; an award-winning author, notably writing The Bottom Billion, on how the world’s poorest countries can achieve prosperity, and most recently Greed is Dead, with Sir John Kay; and frequently writes for magazines such as Prospect and the New Statesman.Host, Leo Nasskau, is an expert on the future of work and interviews authors writing about public policy and political economy — particularly how capitalism can be reformed to deliver sustainable prosperity for all. Learn more about your ad choices. Visit megaphone.fm/adchoicesSupport our show by becoming a premium member! https://newbooksnetwork.supportingcast.fm/finance

Today I talked to Nika Kabiri about her new book Money off the Table: Decision Science and the Secret to Smarter Investing (Houndstooth Press, 2020).Adam Smith not only helped to create the field of economics; the guy was also a moral philosopher who readily accepted the role of emotions in decision-making. How surprised he might have been to discover that it took decades upon decades for the field to come back to accepting the role that emotions and biases play in decision-making! My guest this week, Nika Kabiri, has no such blind spot. She knows that the Confirmation Bias is among the most important factors to weigh in helping her clients. Along the way, this conversation takes in the movie The Big Short and Jerome Powell and what may lay ahead for the economy. Five types of investors are also discussed, from the more-is-better investor to the what-has-always-worked investor. Like not to be poor? This episode is therefore worth a listen.Nika Kabiri teaches Decision Science at the University of Washington, and is the founder and owner of Kabiri Consulting LLC, where she uses Decision Science to help businesses grow.Dan Hill, PhD, is the author of nine books and leads Sensory Logic, Inc. (https://www.sensorylogic.com). His new book is Blah, Blah, Blah: A Snarky Guide to Office Politics. To check out his related “Dan Hill’s EQ Spotlight” blog, visit https://emotionswizard.com. Learn more about your ad choices. Visit megaphone.fm/adchoicesSupport our show by becoming a premium member! https://newbooksnetwork.supportingcast.fm/finance

Today I talked to Michele Wucker about her new book You Are What You Risk: The New Art and Science of Navigating an Uncertain World (Pegasus Books, 2021)Your risk fingerprint is a mixture of how personality traits, experiences, and social context have shaped how you approach risk and uncertainty in life. Also crucial is your risk empathy and the degree to which you are risk-savvy, both of which value reading your environment in analyzing the risk you and others face and how people are coping with unknowns. This episode explore risk in terms of a variety of situations and segments of the population. Are millennials risk-averse or risk savvy? Why are white male who are risk-takers people who tend to trust institutions and be anti-egalitarian? How should companies approach mergers and acquisitions when the two companies have very different risk cultures? And finally, which professions tend to be the most prone to over-confidence? In every case, “it depends” is a fair answer but by no means all that you will hear on these and other topics.Michele Wucker has been honored as a Young Global Leader of the World Economic Forum and a Guggenheim Fellow. Her third book, The Gray Rhino, inspired a popular TED talk and has influenced world markets, government policy and business strategies.Dan Hill, PhD, is the author of nine books and leads Sensory Logic, Inc. (https://www.sensorylogic.com). His new book is Blah, Blah, Blah: A Snarky Guide to Office Politics. To check out his related “Dan Hill’s EQ Spotlight” blog, visit https://emotionswizard.com. Learn more about your ad choices. Visit megaphone.fm/adchoicesSupport our show by becoming a premium member! https://newbooksnetwork.supportingcast.fm/finance

Is it possible that the consensus around what caused the 2008 Great Recession is almost entirely wrong? It's happened before. Just as Milton Friedman and Anna Schwartz led the economics community in the 1960s to reevaluate its view of what caused the Great Depression, the same may be happening now to our understanding of the first economic crisis of this century.Foregoing the usual relitigating of the problems of housing markets and banking crises, renowned monetary economist Scott Sumner argues that the Great Recession came down to one thing: nominal GDP, the sum of all nominal spending in the economy, which the Federal Reserve erred in allowing to plummet. The Money Illusion: Market Monetarism, the Great Recession, and the Future of Monetary Policy (University of Chicago Press, 2021) is an end-to-end case for this school of thought, known as market monetarism, written by its leading voice in economics. Based almost entirely on standard macroeconomic concepts, this highly accessible text lays a groundwork for a simple yet fundamentally radical understanding of how monetary policy can work best: providing a stable environment for a market economy to flourish.Scott Sumner is the Ralph G. Hawtrey Chair of Monetary Policy at the Mercatus Center at George Mason University. He is also Professor Emeritus at Bentley University and Research Fellow at the Independent Institute.Kirk Meighoo is Public Relations Officer for the United National Congress, the Official Opposition in Trinidad and Tobago. His career has spanned media, academia, and politics for three decades. Learn more about your ad choices. Visit megaphone.fm/adchoicesSupport our show by becoming a premium member! https://newbooksnetwork.supportingcast.fm/finance

Data is now central to the economy, government, and health systems—so why are data and the AI systems that interpret the data in the hands of so few people? Alex Pentland and Alexander Lipton's Building the New Economy: Data As Capital (MIT Press, 2021) calls for us to reinvent the ways that data and artificial intelligence are used in civic and government systems. Arguing that we need to think about data as a new type of capital, the authors show that the use of data trusts and distributed ledgers can empower people and communities with user-centric data ownership, transparent and accountable algorithms, machine learning fairness principles and methodologies, and secure digital transaction systems.It's well known that social media generate disinformation and that mobile phone tracking apps threaten privacy. But these same technologies may also enable the creation of more agile systems in which power and decision-making are distributed among stakeholders rather than concentrated in a few hands. Offering both big ideas and detailed blueprints, the authors describe such key building blocks as data cooperatives, tokenized funding mechanisms, and tradecoin architecture. They also discuss technical issues, including how to build an ecosystem of trusted data, the implementation of digital currencies, and interoperability, and consider the evolution of computational law systems. Galina Limorenko is a doctoral candidate in Neuroscience with a focus on biochemistry and molecular biology of neurodegenerative diseases at EPFL in Switzerland. To discuss and propose the book for an interview you can reach her at galina.limorenko@epfl.ch. Learn more about your ad choices. Visit megaphone.fm/adchoicesSupport our show by becoming a premium member! https://newbooksnetwork.supportingcast.fm/finance

In this episode, Daniel Peris, the host of the “Keep Calm and Carry On Investing” podcast, and David Finegold have a wide-ranging discussion of economics and governance questions inherent in K-12 and higher education. Learn more about your ad choices. Visit megaphone.fm/adchoicesSupport our show by becoming a premium member! https://newbooksnetwork.supportingcast.fm/finance

It's time to rethink how we create and allocate moneyIn Outgrowing Capitalism: Rethinking Money to Reshape Society and Pursue Purpose (Fast Company Press, 2021), Marco Dondi sheds light on the fact that most people do not have the economic security to focus on purpose and life fulfillment. He proposes that this is not the way things have to be; there is an alternative. In a quest to change our economic system to cater for everyone, he identifies deep issues in how money is created and allocated and connects these to capitalism. He shows that the assumptions and circumstances that made capitalism a success are no longer true today and then describes a new socio-economic model, Monetism. Dondi's solution is to provide a pragmatic roadmap to institutionalize Monetism and solve societal issues that seemed as permanent as time.Kirk Meighoo is Public Relations Officer for the United National Congress, the Official Opposition in Trinidad and Tobago. His career has spanned media, academia, and politics for three decades. Learn more about your ad choices. Visit megaphone.fm/adchoicesSupport our show by becoming a premium member! https://newbooksnetwork.supportingcast.fm/finance

Jeffrey Hooke's The Myth of Private Equity: An Inside Look at Wall Street's Transformative Investments (Columbia Business School, 2021) is a scathing indictment of the high-flying world of private equity. Piece by piece, Hooke takes apart the PE value proposition and shows, instead of the claimed "higher returns and lower volatility", a startling record of poor performance, exorbitant fees, completely opaque reporting, and a network of enablers that allow the business model to proceed. Daniel Peris is Senior Vice President at Federated Hermes in Pittsburgh. He can be reached at DanielxPeris@gmail.com or via Twitter @HistoryInvestor. His History and Investing blog and Keep Calm & Carry On Investing podcast are at https://strategicdividendinves... Learn more about your ad choices. Visit megaphone.fm/adchoicesSupport our show by becoming a premium member! https://newbooksnetwork.supportingcast.fm/finance

Neoclassical economic theory shows that under the right conditions, prices alone can guide markets to efficient outcomes. But what if it it’s hard to find the right price? In many important markets, a buyer’s willingness to pay for one good (say, the right to use a certain part of the radio spectrum range in San Francisco) will depend on the price of another complementary good (the right to use that same spectrum in Los Angeles). The number of possible combinations can rapidly become incalculably complex. Such complex markets require new collaborations between economists and computer scientists to create designs that are both incentive compatible and computationally tractable.In Discovering Prices: Auction Design in Markets with Complex Constraints (Columbia UP, 2017), 2020 Economics Nobel Memorial Prize winner Paul Milgrom discusses some of the new economics theory he has developed to help address these challenging contexts, in which neither unfettered market forces nor top-down planning will work well. In our interview we explore these ideas in the context of the most complex auction ever created, the FCC’s broadcast incentive auction. This auction, designed and planned by a team led by Professor Milgrom with his company Auctionomics, purchased underutilized broadcast spectrum from television stations and sold it onward to telecoms providers. This reallocation helped improve wireless network performance and pave the way for 5G wireless services, while also generating over $7 billion for the US treasury.Host Peter Lorentzen is an Associate Professor in the Department of Economics at the University of San Francisco, where he leads a new digital economy-focused Master's program in Applied Economics. Learn more about your ad choices. Visit megaphone.fm/adchoicesSupport our show by becoming a premium member! https://newbooksnetwork.supportingcast.fm/finance

In Who Gets What — and Why: The New Economics of Matchmaking and Market Design (Mariner Books, 2015), Nobel Memorial Prize Winner Alvin Roth explains his pioneering work in the study of matching markets such as kidney exchange, marriage, job placements for new doctors and new professors, and enrollments in schools or colleges. In these markets, “buyers” and “sellers” must each chose the other, and getting the prices right is only a small part of what makes for a successful transaction, if cash is even involved at all. Roth’s work has led the way in taking microeconomics outside the halls of academic theory to become a practical “engineering” tool for policymakers and businesses.In our interview, we range far beyond the examples from the book to discuss the implications of his work for the design of tech’s market-making “platform” businesses like Airbnb, Amazon, Lyft, or Uber, the challenges he faces when countries or people view some kinds of transactions as “repugnant” or morally unacceptable, and the reasons why San Francisco’s school district (unlike Boston’s or New York’s) chose not to implement the un-gameable school choice plan his team devised for them.Host Peter Lorentzen is an Associate Professor in the Department of Economics at the University of San Francisco, where he leads a new digital economy-focused Master's program in Applied Economics. Learn more about your ad choices. Visit megaphone.fm/adchoicesSupport our show by becoming a premium member! https://newbooksnetwork.supportingcast.fm/finance