What are the five best books on investing? Well, if you ask five different traders, you’ll probably get five different answers.
A list from Paul Tudor Jones for instance will probably have Reminiscences of a Stock Operator, while a list from Warren Buffett will almost certainly have Security Analysis.
Here’s Marc Faber’s list, which, interestingly enough, has Jules Verne in it according to Five Books. Have a gander:
- Booms and Depressions, by Irving Fisher. Faber chose the books on his list with the great financial crisis in mind, so it’s really no surprise he has a bunch of tomes on the market’s various booms and busts. Here’s the first, written by Irving Fisher back in 1932. Faber calls it “a very good account of how the Boom occurred and how the Great Depression followed,” adding “I think it’s a historical document, so I list it as one of my favourite books.”
- The Economics of Inflation, by Constantino Bresciani Turroni. Written a year earlier than the previous book, “The Economics of Inflation” is a study on the hyperinflation which occurred during the Weimar Republic. Faber says that the author, Turroni, had followed the era’s currency depreciation rather closely and “describes the impact of inflation on equities, on real estate, on wages and on the exchange rate.”
- A History of Interest Rates, by Sidney Homer and Richard Sylla. Most of you will probably be more familiar with Homer’s other work: the 1972 bond-management classic he co-wrote with Martin Liebowitz called “Inside the Yield Book.” Well, this one isn’t far behind in the authority scale. Chronicling interest rate movements over thousands of years and filled with interesting observations of lending practices throughout the millennia, Faber calls “A History of Interest Rates” a must-read book for everyone in investment.
- Manias, Panics and Crashes, by Charles Kindleberger. Arguably one of the best books on market crashes, Kindleberger’s “Manias, Panics, and Crashes” details the speculative manias that gripped the world throughout the centuries, from their humble beginnings to their spectacular consequences, and shows the reader that while history doesn’t repeat itself, it does rhyme quite a bit. Faber pushes this book in the interest of having people “study economic history more carefully,” which is something he feels isn’t the case today.
- Collected Works of Jules Verne, by Jules Verne. Not quite what you expected? Me neither. Faber advocates for these “fantasies of a lunatic” to help teach investors to have an open mind. “What I’m saying is that nobody has a clue how the world will look in 20 years’ time because huge changes can occur. Maybe in 20 years’ time we’ll live on another planet, who knows? I don’t think so, but it could be. And so investors have to take into consideration a lot of events that could happen but that nobody has thought of.” He considers Verne to be “the greatest forecaster of our time.”
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