Friday, 13 September 2013
Weekend Reading: A Strong Capitalist Recommendation
Now of all the stuff written about Enron - and that's a few forests' worth - not a single book has come from a true Enron insider. The omerta has been 100%. (And before anyone cites Sherron Watkins against me, she wasn't very deep inside at all - double meaning intended.)
So I was quickly into Kindle for Lucky and Good: Risk, Decisions & Bets for Investors, Traders & Entrepreneurs, by John Sherriff. (At mates' rates it was free, but it'll only be pence anyhow.) Sherriff was a true Enron insider, as well as being the most creative, energetic deal-maker I have ever met, with the best intuitive feel for risk / reward trade-offs - and that's from a cast of very many fine dealmakers at the Crooked E. He's a damn' good poker player, as well ...
Sad to relate, though he peppers the book with Enron stories to illustrate his many excellent points he tells nothing about the scandalous stuff: so the true insiders' book is still to be written. But that's the only disappointment in an otherwise truly first-class read. I can't recommend it highly enough for the typical C@W reader (and not just for the traders and investors), who won't just enjoy it tremendously but will probably do better business having done so. There are so many powerful - and practical - points made, all of which are IMHO entirely correct, on critical issues such as market pricing, liquidity, how to think of sunk costs, macro-trends, marginal advantage, fast feedback, long-term vs short-term, finding free options, understanding what your long and short positions are: and he goes as far as it's probably possible to go in helping people learn to be commercially creative.
In summary, the whole Enron arsenal.
Even better, it's written with a very light touch - for an American (if I dare say this) Sherriff has a very Anglo-oriented sense of humour. (He's complimentary about several aspects of our regulatory and legal systems as well.)
And he's brutal on the subject of the legal profession ...
Whenever I find myself teaching on business-related topics, students always ask what they should read before attending the course. I've never before had a single book to recommend, but now I do.