MoneyWeek's best reads of 2013

A selection of the best books we've enjoyed reading this year.

We're heading for a big crisis


"If you read only one book on finance this year, make it Code Red," writes Forbes's Richard Lehmann. Many people believe the worst of the crisis is behind us, and that the worlds' central bankers were correct to print money to get us through it.

However, Tepper and Mauldin, the book's authors, argue that these policies have not only ended up "punishing savers and pensioners and spurring these innocents on to take on more risky investments" than wise, but that they have left us very vulnerable.

When these policies are phased out, things could unravel "like 1929". One little thing though, notes Lehmann: the authors should have considered the possiblity that the policies will never be repealed.

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Code Red: How to Protect Your Savings from the Coming Crisis by John Mauldin and Jonathan Tepper is published by John Wiley (£19.99).

A radical break from dogma


Austrian economics has always been controversial. However, as Barron's Mark Skousen points out, people "have started paying attention to Cassandras like Peter Schiff, Jim Rogers, Nouriel Roubini, and Marc Faber" since the 2008 crisis.

The Dao of Capital, by hedge-fund manager Mark Spitznagel, attempts to show how Austrian theories can be used to "pinpoint the potential top or bottom of the market and thus determine whether to be long or short".

While Skousen notes that it might be better to be aggressively long when the market is cheap, rather than trying to short at the tops, the book does represent "a fascinating and radical break from the investment dogma of the past several decades", says Fortune's Scott Cendrowski.

The Dao of Capital: Austrian Investing in a Distorted World by Mark Spitznagel is published by John Wiley (£19.99).

Why we must curb bonuses


Bankers' bonuses have generated a huge amount of public anger, with several countries looking to establish legal limits on pay. However, economist Andrew Smithers "makes a powerful case" that it's not just overpaid traders who are to blame, says The Economist. The trend for linking managers' pay to short-term profits discourages long-term thinking and has lead to underinvestment.

This is "a startling and authoritative attack on the system of tying executives' bonuses to the share-price performance of their companies", says the Financial Times. But this is no emotive rant. Instead, Smithers "establishes this claim meticulously", using plenty of charts. Overall, "this book deserves to remove the emotive issue of executive pay from tired arguments between left and right". At the very least, it should "annoy a lot of people".

The Road to Recovery: How and Why Economic Policy Must Change by Andrew Smithers is published by John Wiley (£18.99)

The dangers of abundance


In this book Daniel Alpert argues that the global economy is suffering the after-effects of a glut of cheap labour and capital. This has benefited those in developing countries, but has hit the wages and income of workers and savers across the developed world.

"I found myself agreeing with most of the factors he identifies as causes for this oversupply: globalisation, lower trade barriers, too much debt, sticky wages, sticky prices," writes Andy Kessler in The Wall Street Journal.

But Alpert uses too many arguments that "tend to inflame the pundit class" and he forgets that oversupply "drives economic growth". However, although it falls into "standard Keynesianism" too frequently, says blogger Tyler Cowan, it is a "fun and interesting read".

The Age of Oversupply: Overcoming the Greatest Challenge to the Global Economy by Daniel Alpert, is published by Penguin (£14.99).

Some of our other favourites


Crowd Money: A Practical Guide to Macro Behavioural Technical Analysis (Harriman House, £40), by Eoin Treacy, looked at how investors could combine charting and behavioural finance to make profits.

Mebane Faber also released the self-published Shareholder Yield: A Better Approach to Dividend Investing (Mebane Faber, £6.60), which shows readers, step by step, how to make returns in a low-yield world. The book analyses hidden dividends, share buybacks and debt repayment.


Regular MoneyWeek contributor Dominic Frisby makes the case for less spending in Life After the State: Why We Don't Need Government (Unbound, £9.99). His book has been called "a page turner on the economy" by James Harding, director of BBC news and current affairs.

Economist Michael Pettis makes the case for further Chinese economic reform in Restructuring the Chinese Economy: Economic Distortions and the Next Decade of Chinese Growth (Carneige Endowment for International Peace, £13.99).


Finally, the Financial Times/Goldman Sachs Business Book of the Year award went to Brad Stone's The Everything Store: Jeff Bezos and the Age of Amazon (Bantam Press, £18.99). Stone had unparalleled access to Amazon employees for his revealing account of the giant who changed shopping forever.