The majority of investors today get the bulk of their information from the Internet. Investors have become accustomed to staring at the computer screen and while it is a marvelous revolution in information dissemination, there are some unfortunate side effects from an investing perspective. The most obvious is the rapid speed with which such information travels as this has the ultimate effect of leading to a rapid response by investors. A stock tanks by 15% and many, instead of taking the time to find out why, simply react -- often without being fully informed.
This week of Thanksgiving begins what tends to be a light-volume, inconsistent market until the new year. After this week, you have a couple weeks before another two-week period of light market activity due to the Christmas and New Year's Day holidays. Many investors relax in anticipation of the new year and the onslaught of corporate earnings.
I like to take advantage of this time by catching up on some long overdue reading, which I often find delivers a wealth of information and knowledge that is absent from the one-click world. And this year, there are some fascinating titles that will captivate anyone with more than a passing interest in the markets, the economy and life.
I am currently wrapping up Bull by the Horns, a no-holds-barred account of the events leading up to 2008 mortgage meltdown and financial crisis. The author, Shelia Bair, was the former chairman of the FDIC. I gather most of us are well aware of why this financial crisis occurred in the first place; nonetheless, the book is refreshing in describing how decisions were made during that period of time. Despite the FDIC's vital role in insuring deposits and the value that guarantee offered to banks, according to Bair, the FDIC was often marginalized by the other federal agencies such as the Federal Reserve, OTS and OCC. Whether you agree with the viewpoint or not, it's an illuminating look into how our agencies operate and think during times of crisis -- sound familiar today?
The Most Important Thing by Howard Marks is short, must-read book for any investor. Written by one of the most astute and sophisticated investors, the book is refreshingly short and very simple to understand. I read it in one sitting.
Moonwalking With Einstein is another neat book by Joshua Foer. The book is subtitled The Art and Science of Remembering Everything. You hear stories about individuals who can remember a string of thousands of random numbers. An intriguing book when you consider the ton of information investors are exposed to.
How Will You Measure Your Life? by Clayton Christensen is certainly a nice change from books simply about investing and making money and a thought provoking book. The Greatest Business Decisions of All Time by the writers of Fortune magazine is a fun narrative of various business moves that have shaped our business world. Accounts include Apple's AAPL decision to bring back Steve Jobs, Henry Ford's decision to double employees' wages, and Toyota's TM pursuit of perfection.
Whatever your taste, use this market down time to enjoy the value found in books. I wish all readers of Real Money a happy Thanksgiving.