Book Review: Three Cups of Deceit

Three Cups of Deceit is the heartbreaking dissection of the lies, fiction and fraud of Chris Mortenson and his best-selling books “Three Cups of Tea”, and “Stones into Schools”.

Three Cups of Tea tells the supposedly true story of Greg Mortenson and the Central Asia Institute (CAI) building schools in Pakistan while on a rip-roaring adventure of Taliban kidnappings amongst other tales. I received it as a present and enjoyed the moving story.

Except that, as it turns out, much of the story is stretched, elaborated and in parts completely concocted.  Jon Krakauer writes, in Three Cups of Deceit, how the seemingly sociopathic Greg Mortenson not only fabricated key parts of the story (and in contradiction of earlier, published articles by his own hand) but also ran the organisation for personal gain.

It’s definitely worth a read, even if it is a little sad to realise that a hero is actually a charlatan.

A point many of Mortenson’s supporters make is that he still did good – he and his CAI did build schools, did educate children and did raise awareness of society building as key methods of improving living standards and understanding in troubled parts of the world.

The problem I have there is that many people who donate money to charities, NGOs and similar programmes will donate the money to a cause anyway. Therefore, a significant portion of  funds that went to the CAI would have gone to other causes if it weren’t for Mortenson’s lies.  Moreover, that money wouldn’t have been squandered on Mortenson, on promoting his book, or on the now-empty schools built in the wrong places without equipment or teachers.

Mortenson redirected money away from good, solid causes and into his own pocket.

Book Review: This Time is Different

This Time is Different is a fascinating look at 8 centuries of financial crises including banking, currency and sovereign default.

It’s chock-full of analysis, numbers, tables and charts showing how as much as things change, the scope for financial crises changes very little.  The comparison of Developed and Emerging Markets is particularly interesting in that the differences, while they do exist, are far smaller than stereotypical views.  Emerging Markets do tend to have more ongoing sovereign defaults, but the frequency of banking crises is little different. Weirdly, some aspects of Emerging Market crises (such as employment impacts) are less than average for the Developed World.

It isn’t really the book’s fault, but this was one of the few books that I struggled with on my kindle – the graphs and charts and captions to figures were particularly difficult to read. Perhaps they would look better on the Kindle DX (the larger model) or even an iPad or something.

Although the book doesn’t focus on the current (still-happening, if you weren’t paying attention) financial crisis, there are several chapters dedicated to it with an analysis of the economic indicators leading up to the crash. Now it’s incredibly easy to predict an event after it’s happened, but I’m still hopeful that the results can be useful in predicting future problems and potentially impacting economic policies and regulations for the better.

Some key conclusions from the book for predictors of financial crises:

  • markedly raising asset prices (yes, and in particular house prices given the likely co-factor of increases in debt levels)
  • slowing real economic activity
  • large current account deficits
  • sustained debt build-ups (public and/or private)
  • large and sustained capital inflows to a country
  • financial sector liberalisation or innovation Continue reading

Book Review: Purple Cow

Seth Godin’s Purple Cow introduces a new P of marketing (to complement the product, price, place and promotion, or further expand the many Ps that have since been added to the marketing mix).

Why Purple Cow? Because it’s extreme, it cuts through the oversaturated marketing and product appeals, which Seth describes as required to have an impact in the current competitive environment.

Light reading, thought-provoking and a great conversation piece, it’s a worthwhile read for those in marketing (who should probably have already read it by now) or anyone involved with growing a business again hordes of competitors. I read it a few chapters at a time, which I recommend as a way to absorb the ideas and ponder them before moving on to the next points.

Definitely worth reading.

Book Review: The Big Short

Michael Lewis, of Liar’s Poker fame, has written an engaging account of the role that subprime lending played in the global financial crisis. The new book is called “The Big Short: Inside the Doomsday Machine”.

The jargon that Lewis uses is generally explained and shouldn’t prevent non finance geeks from understanding the role of subprime lenders, mortgage originators and, of course, the Wall Street banks that fed the frenzy with CDSs, synthetic CDOs and bonuses for all.

The story places a few characters at the centre of the story. I wasn’t convinced that these guys were all skill and no luck, but they certainly seemed to have a clearer idea of what was going on in the murky, muddy waters of securitisations of that era than many of the supposed experts.

Overall, it’s won’t be the smash hit that Liar’s Poker is, but it’s entertaining reading all the time. The links to Gutfreund are tenuous and smell a little of name-dropping. If Lewis wanted to remind the reader of his role in toppling the ex CEO of Salomon Brothers he succeeded. If he wanted to somehow project the glory onto the new book, he failed.

The Big Short at Amazon.co.uk

The Big Short at Kalahari.net

Check out Book Finder for prices from several stores (new and used) in your currency including delivery costs to your location.

Book Review: Socrates and the Fox

What an utter disappointment. Clem Sunter may (or may not) know something about strategy and scenario planning, but this book does nothing to excite me. The analogy of a fox is pushed and stretched and twisted to incorporate it into every few pages with no benefit. The structure and flow of the book make it difficult to read, there is a combination of too many detailed tactical points (particularly for a book on strategy) and superficial examples that demonstrate nothing.

We are expected to take almost everything as given and accepted, with almost no time spent showing, explaining or proving why these ideas work. Add to that some standard business analysis models reworded and renamed, but giving no better (or worse) insight than the original models makes me wonder what the point of reading the book is.

Mr Sunter would have done well to have a editor with a little more backbone who could counter this weak effort and ask him to try again.

Book Review: The Halo Effect

I agree wholeheartedly with the basic premise; maybe that is the problem. As I read, I moved from nodding vigorously in agreement during the introduction to nodding off to sleep by the second chapter.

The general themes of critical thinking, caution and recognising complexity rather than being taken in by simplistic, post hoc, naive, flawed logic reasons for high performance are important. Authors from Tom Peters to Jim Collins have made a fortune, and entertained thousands, with their books on how to improve organisational performance. However, from the admission that much of the data for “In Search of Excellence” was fabricated to small samples and failed long-term predictive ability out of “Good to Great” the answers are imperfect.

The world of behavioural economics has discovered much about exactly how badly we typically think, especially when we don’t realise we should be in “logical analytical mode”. So much so that the book is now old news.

I don’t know whether the author is so impressed with his own ideas that he imagines the need to spell them out in excruciating detail with multiples too much evidence to allow mere mortal readers to understand, or whether the typical reader is so unfamiliar with the requirements of critical thinking that a ten page pamphlet needed to be expanded to several hundred pages. Maybe the publishers paid per word?

If you need convincing that much of what we are taught about success and the few or single simple drivers of it are, the book might be worthwhile as a tome of evidence. If you require a simple memory aid, there is none better than the 1917 quote of Mencken, “There is always an easy solution to every human problem–neat,
plausible, and wrong.”

Book Review: Islamic Banking – A $300 Billion Deception

The book arrived shorter than I expected at around 60 pages, and was probably longer than it needed to be. The author outlines his major points early on and supplements them with some interesting real-world examples throughout the work. Unfortunately, he also repeats many of the key messages more times than is necessary.

Typos and grammatical errors are widespread. Seriously, get a decent editor and proofreader.

A key message from the book is that lending is not risk-free as some proponents of Islamic finance purport. Restricting interest-based lending means many transactions simply won’t take place. Somehow, the author misses the extension of this message when he recommends a cap on interest charged to prevent usury – nowhere does he consider that this will similarly restrict lending to high risk borrowers since at times higher interest rates are required to reflect the risk.

Overall, a good read, most importantly for those who have not yet understood the flaws of the adolescent Islamic finance industry

In the footsteps of the Footsteps of Mr Kurtz

cover of In the Footsteps of Mr KurtzAny company, person or country looking to invest in Africa must read Michela Wrong’s book, “In the Footsteps of Mr. Kurtz: Living on the Brink of Disaster in Mobutu’s Congo” .

The book details the history of the Democratic Republic of the Congo from its pre-Stanley (yes, that Stanley) days before east African Muslim traders were replaced by European explorers through to the eventual downfall of Mobuto Sese Seko and the arrival of Laurent Kabila in the mid-90s.

The “Congo Free State” became the personal possession of King Leopold II of Belgium, the only monarch to actually own a colony. Even against the backdrop of typical colonial abuses, it seems King Leopold was a particularly nasty character, taking his Belgian subjects along for the ride even as he pillaged the depths of Africa.

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