Review of The Future of Banking In a Globalised World (The Wiley Finance Series) (Hardcover)

Chris Skinner's book is an informative and highly relevant book for understanding opportunities and challenges in today's 24*7 global financial markets. His writing is clear and entertaining. Using a fresh and innovative approach, Chris Skinner highlights the importance of technology in servicing customers across the globe, and points to a number of trends that will affect profitability if not taken into account. A must read for anyone interested in 'the future of banking'.



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Review of Deflation: What Happens When Prices Fall (Hardcover)

I follow the financial news fairly regularly, reading the news headlines and many of the columns on the Internet at least three times daily. A few months ago, the main topic of some of the economic stories was one that I had never seen in a contemporary financial column, the possibility of the U. S. economy entering into a deflationary state. A deflationary condition is when prices start to fall, and people begin to delay non-essential purchases in the belief that they will continue to fall, which can lead to an economic collapse. In general, it was considered a significant threat, and apparently the high officers of the Federal Reserve (the Fed) were preparing contingency plans if it were to happen. The possibility, consequences and potential benefits of a deflationary phase in the U. S. economy are the primary topics of this book.
Outside of major wars and their consequences, there were two major economic cataclysms in the U. S. economy in the twentieth century. The first was the Great Depression of the thirties, which was a major deflationary period. The second was the uncontrolled inflation of the seventies, where price increases were relentless, a major success was proclaimed when the inflation rate dropped to ten percent or less. These two long-term economic problems form the major historical basis for the basic premise that monetary policy is the preeminent driver of major economic trends. Milton Friedman, long the primary champion of monetary policy, is mentioned many times. Farrell finds many historical justifications to blame the severity of the two events on the Fed. While it cannot be refuted that the Fed made many major mistakes in both situations, the political leadership also must bear a great deal of responsibility. That point is made, but not quite as forcibly as it should have been.
The primary event that is driving the current concern over the potential for deflation is the performance of the Japanese economy in the last decade. It has been in a recurring deflationary condition throughout that time, performing sluggishly and with no end in sight. However, Farrell uses this as a point of demonstration as to how monetary policy can be used in a counterproductive manner. He argues that the Fed is smart enough to avoid those mistakes and will act quickly and forcibly to prevent a dangerous deflationary trend in the U. S.
Another major point is whether deflation is in fact a trend to be feared or welcomed. As Farrell so excellently points out, there have been many deflationary periods in the American economy, and while we remain focused on the 1930's, the others were often periods of economic expansion and growth. They were due to the development of new technologies, which led to previously unheard of improvements in efficiency. Dramatic improvements such as the telegraph, telephone, railroad and medical advancements all changed society and dramatically lowered the costs of gods and the efficiency of living. His point is that if the costs of the goods are declining due to increased efficiency, then it is a very good thing. Companies being forced to reduce their production costs in order to compete is always a boon to the overall economy.
The last chapter contains a series of recommended policy changes. The first is that global free trade should be expanded to include all nations. Farrell argues that since the poorer nations largely rely on agriculture, the U. S. should stop subsidizing agriculture, which would allow the products from the poorer nations to compete in the global markets. A valid point, but of course politically impossible. One point that I found of particular interest was the cost benefits of sophisticated medical care. He argues that nearly every successful medical treatment returns more than it costs. The exact figures are that from 1960 to 1997 it cost approximately $13,000 in medical spending and pharmaceutical research to gain one year of additional life and that the economic return on this additional year of life was $150,000. If true, it would be the most powerful argument for universal health care that could be made. An additional argument made in this section is that the current system of employer-managed health care programs is inefficient and should be refined into a single program.
Several pages are devoted to significant human capital investment, which means enormous investments in education and training. Farrell argues very forcefully that this is essential and historically justified. As Americans began moving from a rural, agrarian society to an urban, industrial one, the massive investments made in education were necessary for the transformation to be complete. He argues that sufficient investment capitol would be available if the agricultural subsidies were eliminated.
Farrell makes powerful arguments in favor of his basic premise that deflation is an expected consequence of dramatic increases in economic efficiencies due to the opening of global trade and technological advancements. While I sometimes had minor disagreements with his points of emphasis and understand that his proposals for solution are largely politically impossible, I found the book a sound analysis of what is now being raised as a potential economic danger.



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Review of A Free Nation Deep in Debt: The Financial Roots of Democracy (Hardcover)

"A Free Nation Deep in Debt" is James Macdonald's first literary contribution to the field of political economy and it is rich in historical detail, a fact which may make it a challenging read for anyone unacquainted with ordinary economic history and its specific historiography. Macdonald, an investment banker for many years who now lives in Oxford, England, discusses the idea that the way a country borrows its money is associated with what kind of government it has. In his discussion, Macdonald traces the evolution of public debt from antiquity to the present, arguing that public finance and political freedom are more closely interrelated than most people realize.

For those who like some structure in a book of this complexity, it can easily be divided into an introduction and four main sections. The first seven pages, with the title "Introduction: The Financial Roots of Democracy," sketches out what is to come, providing the reader with a framework for the coming text and raising the essential questions with which the author will wrestle.

The first section traces the history of public finance and political freedom from the end of the Bronze Age to the end of the Dark Ages, contrasts two different types of finances -- tribal and imperial, explains the historic advantages of autocratic government, considers the critical period when some of the emerging societies settled down and civilized themselves without losing their political freedom, and, in regard to the so-called Dark Ages, asks why they had a more intense and enduring effect in western Europe than in other places. This initial section sets the stage for a comprehensive description of the relationship of public finance and political freedom in the Middle Ages and modern times.

The second section deals with medieval Europe. It was to be the role of medieval Italian city-states to bring back the idea of democratic public financing and modify it so it could become a workable plan for public financing. According to Macdonald, "The system that they created, although in one way fatally flawed, set off a chain of events with results that no one could have predicted." The third section of the book continues the discussion of public finance by looking at the attempts of other European states to come to terms with the implications of the Italian strategy.

The fourth and final section considers events after the French Revolution, and the author suggests that "The outcome of the Napoleonic Wars demonstrated the superiority of a political system based on the alliance of parliamentary government and public debt, but now there was a new question: Would a system created in a world of restricted citizenship and limited franchise prove compatible with universal suffrage. It was the role of the nineteenth century to find a solution to this problem. In the devastating wars of the first half of the twentieth century, this solution was put to the test." And Macdonald concludes that "The First World War was the apotheosis of 'democratic' public finance, the Second its swan song."

Throughout the reading of "A Free Nation Deep in Debt," one is struck continually by both the historical detail the author has uncovered and the factual surprises which he springs on the reader. How many of us realize, for instance, that the problem of public financing was intimately related to the fall of Rome or that in the eighteenth century it was commonly accepted that public debt and political liberty were intimately related? Regarding our own time and country, how many of us realize that the role played by the United States in World War I was funded with public debt?

I will leave it to the experts in economic theory and history to evaluate what appear to be Macdonald's conclusions in this romp through political economy from ancient Mesopotamia to the United States in the twentieth century. Has public borrowing from citizens in times of war gone hand in hand with modern democracy, as Macdonald argues? Does he present a compelling case showing why a democratic government is able to borrow more cheaply from its citizen-lenders than an autocratic state who does not consider its citizens to be equals? Was, in fact, World War II the "swan song" of democratic public financing? And, if true, has this occurred as a result of a decline in the public's trust of government, particularly in Western nations, combined with increasing globalization of the economy?

Readers can decide for themselves whether Macdonald adequately answers the above questions, as well as the other questions he tackles. Suffice to say, "A Free Nation Deep in Debt" is a comprehensive and detailed consideration regarding a certain aspect of economic history, specifically the relationship between public financing and political freedom. Certainly an interesting read, but let the reader beware. This scholarly book is definitely not Sunday afternoon "leisure" reading.

Fortunately for the reader, this book is enhanced with a detailed appendix of notes on currencies which describes them and sets out their relationships in historical context. Furthermore, a helpful glossary is provided which explains the technical terms used in the text, although the educated reader will not have much difficulty with the terms as they are used since they are explained as they occur within the text itself. The author has also provided thirty-five pages of notes, a 21-page bibliography, and a useful index with both major and minor topics listed.



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Review of Less Is More: How Great Companies Use Productivity (Hardcover)

Perhaps because of, or even in spite of, positive reviews aplenty from other Amazon reviewers, I found this book disappointing and confusing. A comment in the Introduction caught my attention. Jennings writes "we were eager to avoid Tom Peters' embarrassment when a number of excellent companies sagged badly soon after publication..." Quick Google searches on three (there were more companies; I just did three) Jennings-commended companies (The Warehouse, Ryanair, and Nucor) read more like embarrassments as well.

To be specific:

The June 4, 2003 New Zealand Herald reported that "The Warehouse founder Stephen Tindall has stepped back into the company's day-to-day operations, leading a scheme dubbed Project Urgency to fix its Australian problems. ... Tindall is leading Project Urgency. Its aim, as the name suggests, is to give the Australian operation a rapid makeover."

At the same time, Ryanair had its own problems. Per the web report: "Europe's fast-growing low-fare airline, dropped as much as 14.7 percent Tuesday after the low-fare airline said it expects lower fares and yields this year will pressure its profit margin." The book may provide an explanation: Jennings lauds attention to customer service and satisfaction and chastises those who fail to respond to customers. As Jennings ironically notes: "Other than cheap airfares, customer service at Ryanair is nonexistent." Queried by Times of London reporter as to the paper receiving "more complaints concerning Ryanair's customer service than any other airline," Ryanair's CEO response: "We don't screw them every time we fly them." Nice attitude.

A third featured company, Nucor, also turned south about the time Jennings went to press: Nucor's stock price dropped by half between mid 2002 and early 2003.

There is more I found unsettling: Jennings repeats canards about "eggs and ham" (the chicken's involvement and the pig's commitment), about showing prospects a heavenly version of product yet delivering hell, and about decentralizing fireworks production (avoiding one big explosion). He mimics Jim Collins's "Get the right people on the bus." He follows Peter Drucker's ideas to produce the anagram, WTGBRFDT ("What's the good business reason for doing this?"). And Edwards Deming must be spinning in his grave when he reads Jennings: "The objective is to perform the task with zero variation." (p.129)

The all-too-flattering biographies and profiles remind me of Fast Company or Inc. pieces. The book concludes with a self-congratulatory chapter recommending of Jennings' previous work, an epilogue featuring Jennings' personal trainer, and a lengthy section of acknowledgements that consists of name dropping more than links to research help. He commends his research team of recent graduates of Stanford, Princeton, and Berkeley yet he offers no systematic research, data, tables, graphs, analyses or standards. Jennings has a lot of ideas and inspiration, but little is substantiated. And, in another twist, the book is about more (productivity, profits, revenue per employee), not less. The final product is a watered down amalgam of "In search of excellence" and several other popular business authors and books.



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Review of Finance: Introduction to Institutions, Investments, and Management (Hardcover)

This is an excellent overview of finance and related topics. focuises on macroeconomic factors, such as aspects of national banking and finance, international trade and currency exchange systems, etc. Also focuses on corporate and business finance. Also contains excellent exercises for math and accounting functions.



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Review of Texas, Cotton, And The New Deal (Sam Rayburn Series on Rural Life) (Hardcover)

Dr. Volanto has written an interesting book about the New Deal's attempt to deal with ever dropping cotton prices and overproduction which only worsened the Great Depression. He writes about the various years and the attempts by FDR and the AAA department to get farmers to voluntarily reduce their crops and pay them to plow up their lands with the goal of bring production under control. He makes an interesting point in the book when he notes that severe droughts did more to help limit cotton production than did the AAA's programs.
It's a short history of just one state's problems during the Great Depression. He does not compare the AAA (Agricultural Adjustment Act) program in Texas with other cotton producing states (which would have been an asset to the book) but it's a good historical read and very informative.



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Review of Real Estate Development: Principles and Process 3rd Edition (Hardcover)

This book was recommended as a textbook for a 4th year course in real estate development and it reads like one. It is well organized and covers this broad subject with detailed, practical information in a systematic way.

Most of all I enjoyed the two real life case study storys (of the development of an office building and a high-rise apartment) that weave through the chapters. These were very candidly told by the developers themselves and give the real picture of the trials and tribulations of large project real estate development.

Numerous listings of information sources, web sites, and bibliographies at the end of each section makes this book a 'keeper' reference text.



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Review of Alexander the Great's Art of Strategy: The Timeless Lessons of History's Greatest Empire Builder (Hardcover)

The flow of this book is in alignment with the thought process of business executives. The USP of this book is it has historical pieces coupled along with strong analysis to churn out wisdom for leaders as well as strategists in every sphere.

May be a few historical points are not spot on in this book. However, the readers of this book should not be in pursuit of history but wisdom acquisition from the life of the greatest conqueror of all time, Alexander the Great, who never lost a war.

This book makes a close analysis into what made Alexander so special. Apart from being gifted with special traits of a natural leader, Alexander was able to make huge magnitude of impact during his short life due to his forward thinking father, Philips of Macedonian. Aristotle, mentor of Alexander, helped him develop a strong analytic framework of mind and appreciation for looking at issues from various perspectives. The book mentions that the "think global act local" approach was first promulgated by Alexander. As one reads on, one will understand how and why many leaders / strategists (in various spheres) over the centuries have been inspired by Alexander the Great.




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Review of Success Runs in Our Race: The Complete Guide to Effective Networking in the Black Community (Hardcover)

I would recommend reading this book, as well as giving this book as a gift to all college graduates. The chapter that tells how to create and do an awards ceremony in less than 2 hours alone is worth the price of the book! I particularly liked the way he defined "networking" vs. "neck-working"--and how to handle those who have mistaken one for the other. (Neck-working is misusing your opportunity to network by trying to hit on the opposite sex--a definite no-no!) Mr. Fraser's solid hints on connecting with like-minded individuals in the black community and giving back to the community, not abandoning it are fantastic--and doable. If you like commentary by people like Tavis Smiley, this is your book!



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Review of Merton Miller on Derivatives (Wiley Investment) (Hardcover)

Merton Miller, who died in 2001, was an outstanding figure in modern economics. He was one of three financial economists to win the Nobel Prize for Economics in 1990, in his case for his work on the capital structure of corporations - a field that, with his associate Franco Modigliani, he revolutionised if not invented. His great insight was that the value of a company, other things being equal, is invariant with regard to the mix of debt and equity that makes up its capital structure - or, to invoke one of Miller's own picturesque analogies, if I take a dollar out of my right pocket and put it into my left pocket, I am no better off.

This book is a collection of speeches given by Miller in the early to mid-1990s, largely covering the subjects of the derivatives revolution, regulation and corporate governance. The subject matter sounds dry; the speeches are anything but. Miller's jokes are exceptionally good - he has great sport in particular by satirising the convoluted German system of corporate cross-shareholdings, and reflecting ruefully on the inevitable question that is always posed to professional economists ('what will happen to interest rates?' - to which the only sensible answer is 'they will fluctuate'). But underlying the wit and engaging manner is a serious and profound point. Modern finance consists principally in the management of risk. Derivatives perform an exceptionally valuable function in a modern, complex economy by enabling economic agents to accomplish this end. Ill-conceived regulation can do harm by making it impossible for corporations to manage their business risk efficiently; this will have significant economic cost, with no compensating social benefit.

Many collections of speeches are testament merely to an author's vanity, and do not last beyond the occasions for which the speeches were written. This one is different: it is the fruit of an extraordinary intellect, a fine prose style, and a formidable technical expertise. It deserves to last, and is much to be recommended.



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Review of The Marketing Mavens (Hardcover)

Noel Capon enters a thoroughly ploughed field of business writing and surprised this reader by digging up many fresh treasures. He achieves this through his savvy research project (this book is way more than the standard round-up of usual suspects,) and through choosing some left of field businesses to examine: The Mayo Clinic? The result is fresh writing, fresh thinking and recommendations that aren't necessarily all new, but are re-phrased and re-expressed for today's times.

I'm beginning to find marketing gurus like Aaker (Example: Building the Brand-Driven Business: Operationalize Your Brand to Drive Profitable Growth,) somewhat tired these days, and slipping behind the game in terms of what the age of the internet has done to personalise and redefine the relationships between organisations and their customers. Mass marketing, as it became defined in the post-war years up to the 1990s, is over and done with: everything is coming down to a one on one encounter, but on a large scale.

Capon clearly gets this, and communicates this. I particularly appreciate his writing on how organisations need to better integrate (break down those silos,) in order to serve the customer, and how organisations must measure what matters. For many marketers, as they'll see here, 'what matters' may be quite different from what they've been measuring to date. Well recommended. $18? Spend your money.




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Review of Financial Institutions Management + S&P + Enron PowerWeb (Hardcover)

This is probably the best book in risk management available today. This is due to the combination of breadth and depth of the text. The author gently introduces the student to an important subject and explains with pains how to manage each and every kind of risk. The two chapters on Interest rate risk are absolutely fabulous. There is a sense of continuity because the concepts you learn in one chapter has applications in another. The problems at the end of the chapters are are also challenging and will require an in-depth understanding of the subject. This book is the ultimate.



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Review of Panic for Democracy (Hardcover)

This is a great read.Van Schalkwyk has drawn on wealth of research to effectively argue that our politicians and institutions have duped us, as their actions are self serving with total disregard for future generations.A weighty topic like this could easily have been a dull read but the author manages to maintain interest with a broad sprinkling of references ranging from medieval history through to modern fashion trends.If enough people were to read this book and perhaps listen to some of the others voices of reason out there, perhaps there would be chance for change.For all those who prefer to keep their head in the sand, not abook for you!



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Review of Banking in Asia: The End of Entitlement (Hardcover)

As a marketer of technology products to the financial services industry, I found this text extremely useful in developing a go to market strategy for Asia.Excellent qualitative analysis and suprising amount of quantitative detail.The best (only) overview for anyone wanting to understand financial services in the countries of the Asia Pacific region.



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Review of Commercial Real Estate Investing in Canada: The Complete Reference for Real Estate Professionals (Hardcover)

The Boirons cover all aspects of commercial real estate investment in the Canadian market in a comprehensive, understandable, readable way. The walk you thru the process of decision making and selecting properties, making offers and understanding some of the less common problems that arise for investors in these properties. This book is worth its weight in gold!



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Review of Global Securitisation and CDOs (The Wiley Finance Series) (Hardcover)

Although not smooth reading, "Global Securitisation and CDOs" by Mr. John Deacon, provides a comprehensive lay of the Collateralized Debt Obligation (CDO) landscape - certainly the sexiest area of securitization and one of the most exciting areas of modern finance.I have worked with CDOs for over two years and find the ever evolving nature of both sides of the CDO world very exciting; their shifting asset structures and their evolving liability configurations make each deal unique from the next.

Overwhelmingly, one senses that "Global Securitisation and CDOs" was written by an industry expert brimming with superb information and an outstanding legal background.And certainly, that is exactly what Mr. John Deacon is.His genuine passion for CDOs and structured finance is self evident.However, similarly obvious, this tome was not written by a professor, professional teacher, or consultant willing to lead you on a structured path toward CDO knowledge.At times, the work reads more like a study than an actual book; information is thrown at the reader without enough connections, structure and signposting.

Fundamentally, "Global Securitisation and CDOs" is a very good (and much needed) handbook/reference guide with useful graphs and tables.I recommend it as a reference guide - suitable for a mixture of skimming and in-depth reading - and as a fantastic starting point for intelligent CDO conversation.



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Review of Higher Profits Through Customer Lock-In (Hardcover)

Author Joachim Büschken adeptly presents a different form of pricing strategy based on making it more expensive for customers to switch from your product to a new one, even if your product fails them. This concept, called "customer lock-in," entails charging such high "switching costs" for changing vendors that customers are stuck. It means that consumers who buy deficient software or earn frequent flier miles on a chronically tardy airline are reluctant to change because switching is a big nuisance or too expensive. While your business may not embrace this idea, some hardware (Hewlett-Packard) and software (Microsoft) companies use it to great advantage. To his credit, Büschken has a short section on the ethics of lock-in. He concludes that it is ethically okay given disclosure, though you may want to have a deeper discussion. While the writing can be repetitive and dry, we find that this is a rare book on a sensitive topic. We recommend it to marketers and product strategists who want to learn more about this little-known, potentially controversial pricing practice. It is also a pretty good eye-opener for consumers; customer lock-in takes 'caveat emptor'to new heights (or depths).



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Review of Understanding the World Economy (Hardcover)

I rate this book very highly. I was a big fan of the first edition and it proved to be a good servant to many of my students. The new edition is even better and I guess it would be a very useful test for economics and business first years as well as older readers who want to get to grips with economics.



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Review of Issuer Perspectives on Securitization (Hardcover)

In the Executive MBA Program of the Wharton School, where I teach, we have instituted a new finance course on structured financial products and asset-backed securitizations, from the corporate treasurer's perspective. This book featuring issuer perspectives on securitization fits our courseperfectly, and is popular among the executive MBA students.The authorsare very knowledgable and are able to communicate well.I highly recommendthis book to anyone who wants to delve into this relatively new area offinance.



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Review of Hedgehogging (Hardcover)

I previously worked in the hedge-fund industry and now teach college students about finance. Therefore, I found Barton Biggs' anecdotes both instructive and amusing, having seen some of the poor lifestyle choices that some hedge fund managers ("hedgehogs", according to Byron) make.

However, the book's strength is not an "inside look" into the world of hedgehogs, but a series of instructive vignettes about how to be an "investor". According to Biggs, a true investor sees one step ahead, while the rest of us are responding to the "now".

The true investor pays a high price for this insight. A true investor makes mistakes, is inevitably early, has doubts, lives in a lonely world, and is abandoned at precisely the wrong time by his most loyal investors. Sleepless nights, grinding teeth, and poor digestion are just part of the price paid. (I certainly can attest to this, though I would never claim to be a true investor. I guess that I am just a "journeyman".)

The goal of people with money to invest is to find these true investors, give them their money, watch them closely, and stick with them through thick and thin. One must constantly watch, though, for the weaknesses that often come with success.

In the first half of the book, Byron provides many instructive stories, centered on his town of Greenwich, of successful hedgehogs who let their money determine their lifestyles. Inevitably, pride comes before the fall, destroying both lifestyles and businesses.

I strongly recommend this book, not as an investment guide, but as an "investor guide" -- a guide on how to be a successful investor or how to find successful investors to work for you. This book fills an critical hole in my library.

Addendum January 8, 2006: I've spoken to a few friends in the business who are quite angry about the passages in the book concerning the Breakers meeting that is sponsored by Morgan Stanley. I, too, felt that Biggs' comments were unwarranted, but they did not detract from the book for me. There are many in the hedge fund community who feel that Biggs owes them an apology. I agree.



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