99 Books
+ 4 Horsemen (of the Investment Apocalypse)

Categories Author: Jim O'Shaughnessy, Insight

Here’s a book that had a big impact on my investment philosophy. Plus, I’m including a long list of other books, each one chosen to take your mind off the market and help you override the human hard-wiring that often leads us to poor investment decisions. 
book cover

One of the first investment books I read as a teenager was Reminiscences of a Stock Operator by Edwin Lefevre.

This book taught me that the one thing that never changes on Wall Street is that it is people who determine the price of stocks. First published in 1923, it is widely assumed to have been co-written by infamous stock speculator Jesse Livermore.

Only 2 pages into the book, this pullquote still rings true today:

Another lesson I learned early is there is nothing new in Wall Street. There can’t be because speculation is as old as the hills. Whatever happens in the stock market to-day has happened before and will happen again.

The book provides endless examples that the pricing of stocks is guided by the “4 Horsemen of the Investment Apocalypse” — Fear, Greed, Hope, and Ignorance. Over time, these “4 Horsemen” have been responsible for more losses than any raging Bear Market could ever muster. Yep, human behavior drives the stock market. We’ve been making the same mistakes all the way back to one of history’s most brilliant thinkers Isaac Newton, who lost a fortune in the South Sea Trading Company stock bubble of 1720. Newton lost his money because he got caught up in the hype of the moment, investing in a colorful story rather than a reasonably-priced stock.
The book is chock full of passages that sound like they could’ve been written yesterday. Consider this passage, even though the language is a bit archaic:

Finally, there came the awful day of reckoning for the bulls and the optimists and the wishful thinkers and those vast hordes that, dreading the pain of a small loss at the beginning, were now about to suffer total amputation—without anesthetics.

He wrote the latter about the crash of 1907,1 but it could just as easily have been written about the crash of 2008, when there were plenty of “wishful thinkers” peddling sub-prime mortgages and insisting that U.S. real estate prices would surge ever upward.
Not only is the book a fun read, it reminds us that — while stock names change, industries change, investment styles come in and out of fashion, and a parade of innovations have made the world a better place since the book was written in 1923 — the one thing that hasn’t changed is human nature. We have over-priced every innovation, from the railroads to the internet,2 because we’re human.

Investors just starting out should begin by reading Reminiscences. This wonderful book is as fresh today as it was in 1923. Psychology and the Stock Market by David Dreman is another book that’s helpful for neutralizing all the noise that bombards investors continually. Dreman’s antidote boils down to using more human psychology and fewer mathematical theorems.

However, in the spirit of the Holidays, let’s brush aside money-related reads and take a mental vacation. This list of books — a mix of classics and recent hits — most of which have absolutely nothing to do with financial decision-making.

The list is also downloadable as a .CSV file, sortable by title & author. In the file, Patrick’s book reviews from previous Blog articles are mixed in (or go to osam.com/books).

  1. Adapt: Why Success Always Starts with Failure (Harford, Tim)
  2. All the Light We Cannot See (Doerr, Anthony)
  3. Beautiful Ruins (Walter, Jess)
  4. Before She Met Me (Barnes, Julian)
  5. The Black Dahlia (Ellroy, James)
  6. The Blank Slate: The Modern Denial of Human Nature) Pinker, Steven)
  7. Boyd: The Fighter Pilot Who Changed the Art of War) Coram, Robert)
  8. Bring Up the Bodies — Wolf Hall Series 2 (Mantel, Hilary))
  9. Brute: The Life of Victor Krulak, U.S. Marine) Coram, Robert)
  10. Central Station (Tidhar, Lavie)
  11. Churchill (Johnson, Paul)
  12. The Cider House Rules (Irving, John)
  13. Cleopatra: A Life (Schiff, Stacy)
  14. Cloud Atlas (Mitchell, David)
  15. A Confederacy of Dunces (Toole, John Kennedy)
  16. The Corrections (Franzen, Jonathan)
  17. The Daily Stoic: 366 Meditations on Wisdom, Perseverance, and the Art of Living) (Holiday, Ryan; Hanselman, Stephen)
  18. Dead Babies (Amis, Martin)
  19. The Devil in the White City: Murder, Magic, and Madness at the Fair That Changed America (Larson, Eric)
  20. The Dog Stars (Heller, Peter)
  21. The Doors of Perception Includes Heaven and Hell (Huxley, Aldous)
  22. Dune (Herbert, Frank)
  23. England, England (Barnes, Julian)
  24. The Fall (Mawer, Simon)
  25. The Forever War (Haldeman, Joe)
  26. Foundation (Asimov, Isaac)
  27. Genius: The Life and Science of Richard Feynman (Gleick, James)
  28. Ghostwritten (Mitchell, David)
  29. The Glass Room (Mawer, Simon)
  30. The Great Gatsby (Fitzgerald, F. Scott)
  31. Here is New York (White, E.B.)
  32. The Hitchhiker’s Guide to the Galaxy (Adams, Douglas)
  33. The Hobbit (Tolkien, J.R.R.)
  34. How to Win Friends and Influence People (Carnegie, Dale)
  35. An Incomplete Education: 3,684 Things You Should Have Learned but Probably Didn’t (Jones, Judy; Wilson, William)
  36. Influence (Cialdini, Robert B.)
  37. Into Thin Air (Krakauer, Jon)
  38. Juliet, Naked (Hornby, Nick)
  39. Last Chance to See (Adams, Douglas; Carwardine, Mark)
  40. The Lemon Table (Barnes, Julian)
  41. The Lessons of History (Durant, Will and Ariel)
  42. Letters of Note (Usher, Shaun)
  43. London Fields (Amis, Martin)
  44. Major Pettigrew’s Last Stand (Simons, Helen)
  45. Middlesex (Eugenides, Jeffrey)
  46. Millennial Money: How Young Investors Can Build a Fortune (O’Shaughnessy, Patrick)
  47. Money) A Suicide Note (Amis, Martin)
  48. Mystic River (Lehane, Dennis)
  49. No Country for Old Men (McCarthy, Cormac)
  50. Nutshell (McEwan, Ian)
  51. On Chesil Beach (McEwan, Ian)
  52. On the Meaning of Life (Durant, Will)
  53. Open City (Cole, Teju)
  54. The Photograph (Lively, Penelope)
  55. A Prayer for Owen Meany (Irving, John)
  56. The Pregnant Widow (Amis, Martin)
  57. The Rachel Papers (Amis, Martin)
  58. The Rape of Europa: The Fate of Europe’s Treasures in the Third Reich and the Second World War
    (Nicholas, Lynn H.)
  59. Ready Player One (Cline, Ernest)
  60. The Remains of the Day (Ishiguro, Kazuo)
  61. Rewire Your Brain: Think Your Way to a Better Life (Arden, John B.)
  62. The Road to Lichfield (Lively, Penelope)
  63. The Road (McCarthy, Cormac)
  64. Rules for Old Men Waiting (Pouncey, Peter)
  65. Sapiens: A Brief History of Humankind (Harari, Yuval Noah)
  66. Saturday (McEwan, Ian)
  67. The Screwtape Letters (Lewis, C.S.)
  68. Seabiscuit: An American Legend (Hillenbrand, Laura)
  69. The Selfish Gene (Dawkins, Richard)
  70. The Sense of an Ending (Barnes, Julian)
  71. The Shipping News (Proulx, Annie)
  72. Shutter Island (Lehane, Dennis)
  73. Slade House (Mitchell, David)
  74. The Snowball: Warren Buffett and the Business of Life (Schroeder, Alice)
  75. Solar (McEwan, Ian)
  76. The Stars My Destination (Bester, Alfred)
  77. Station Eleven (St. John, Emily)
  78. Status Anxiety (De Botton, Alain)
  79. Steve Jobs (Isaacson, Walter)
  80. Subliminal: How Your Unconscious Mind Rules Your Behavior (Modinow, Leonard)
  81. Success (Amis, Martin)
  82. Sweet Tooth (McEwan, Ian)
  83. Talking it Over (Barnes, Julian)
  84. The Stars My Destination (Bester, Alfred)
  85. The Tender Bar: A Memoir (Moehringer, J.R.)
  86. The Children Act (McEwan, Ian)
  87. The Thousand Autumns of Jacob de Zoet (Mitchell, David)
  88. Tools of Titans (Ferriss, Timothy)
  89. Twins: And What They Tell Us About Who We Are (Wright, Lawrence)
  90. Ubik (Dick, Philip K.)
  91. Unbroken: A World War II Story of Survival, Resilience, and Redemption (Hillenbrand, Laura)
  92. Water for Elephants (Gruen, Sara)
  93. What do You Care What Other People Think? (Feynman, Richard P.)
  94. When Breath Becomes Air (Kalanithi, Paul)
  95. A Widow for One Year (Irving, John)
  96. Wolf Hall (Mantel, Hilary)
  97. World War Z: An Oral History of the Zombie War (Brooks, Max)
  98. You are the Placebo: Making Your Mind Matter (Dispenza, Dr. Joe)
  99. Zen and the Art of Motorcycle Maintenance (Pirsig, Robert M.)

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  1. “This time it’s different?” Not really — same, even from 100+ years ago.
  2. FANG stocks, anyone?