…the most commonly repeated and most expensive investment advice ever given in the boom just before a financial crisis stems from the perception that “this time is different.” This Time is Different places 200 years of financial crises under sharp scrutiny. Reinhard and Rogoff note that financial fallouts occur in clusters and with surprising consistency, … Read more
The Aftermath of High Inflation and Currency Collapses Countries that experienced a prolonged period of inflation often experience dollarization (heavy use of foreign currency as transaction medium, unit of account, and store of value). Practically, the use of foreign hard currency in trade, or the indexation of bank accounts and bonds is possible. In many … Read more
Banking Crises, Inflation, and Currency Crashes Countries can outgrow a history of repeated bouts with high inflation, but no country yet has graduated from banking crises. Banking Crises and Bank Runs Banking crises has plagued both rich and poor countries alike – the authors of the book make this conclusion based on a historical analysis … Read more
Mexican Dollar-Linked Domestic Debt: The “Infamous” Tesobonos To stabilize inflation in the late 1980’s, the Mexican peso was tied to the U.S dollar via an official exchange rate band. It was a peg to the U.S dollar. In early 1994, the peso came under speculative pressure after the assassination of a Mexican presidential candidate Colosio. … Read more
Debt intolerance is a syndrome in which weak institutions and political systems make external borrowing a tempting prospect for governments, to avoid difficult decisions with regards to spending and taxing. Emerging market countries with overall rations of public debt to GDP above 100 percent run a high risk of default. Even advanced economies run this … Read more
An external debt crisis occurs when a government defaults on its external debt obligations. Typically, but not always, this loan is denominated in a foreign currency, and held mostly by foreign creditors. The largest default on record is held by Argentina. In 2001, it defaulted on more than $95 billion in external debt. Domestic debt … Read more
Joshua Waitzkin is an American chess player, martial arts competitor, and author of The Art of Learning. He was recognized as a prodigy, and won the U.S. Junior Chess championship in 1993 and 1994 before becoming a world champion in Tai Chi. This book is his explanation of the principles underlying his learning process. The Process … Read more
Peter Bevelin divides Seeking Wisdom into two parts. The first describes our natural human tendencies and how they often fail us, while the second part describes principles that we should think about and apply, to improve our decision making. Most of the advice and stories are given by Buffet and Charlie Munger, with some references … Read more
Jab, Jab, Jab, Right Hook by Gary Vaynerchuk is, like all books about marketing, about how to be relevant in a sea of noise. But what Gary does well in this book, is he tells us how media has changed, why what worked in the past doesn’t work today, and makes good arguments for how … Read more
The Philosophy of Little Bets Little Bets by Peter Sims is about making many low-cost experiments and investing in what works, rather than investing in one big idea from the start. This philosophy isn’t new, it has been discussed in other books including The Learn Startup by Eric Ries and 4 Steps to Epiphany by … Read more