The problem of choice

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I know those far more learned than me have written about the problem or the paradox of choice, but I saw it in action at the Avondale Markets yesterday.

It's a great place, full of colour and life, but fear stalks every corner. Fear of the better bargain, just after you've decided to buy something.

This is worst with fruit and veges, where it's actually pretty difficult to compare apples with apples. Yes, those apples are cheaper, but they're also smaller and not as good quality.

So after a few circuits of the fruit and vege section of the market, our bags were still empty, and we had to just buy something.

Of course, we could have brought paper and marked down prices for absolutely everything we were after, but that would kind of be boring and/or irritating. Much better to enjoy the sun and the craziness that is Avondale market.

Making sense of dollars

Some people just "get" money. I don't.

Sure, I can do my business' accounts every year, but talk to me about cash rates and inflationary reserves and my eyes glaze over. As a journalist who reports on marketing, I need to upskill in this area.

So I've just finished reading two books that I hoped would give me the inside track on economics and money management:

Kissing the Frog: The magic that makes you money by the Brothers Middleton
and
Economics: A little book of big ideas by Matthew Forstater

Frog Kissing

Kissing the Frog is a brilliant idea - a storytelling approach to learning about investment.

The story follows Goldilocks as she seeks advice on investing in property, shares and businesses. Along the way she meets just about every fairytale character you've ever heard of, which is very smart, because it ties abstract financial and economic principles to familiar fairy tales. Somehow, along the way, the principles start to feel simpler and more familiar than they actually are.

It's not for kids, mind you. The Brothers Middleton try to spice up the story a little by adding a fair bit of sexual innuendo, particularly about that Prince Charming.

Because Frog is not just a dry treatise on investment, it's free to explore the more emotional side of investment. For me, anyway, the principles were easier to understand because they were told outright, and then explored through a story.

The Brothers Middleton also use different characters to educate us about different approaches, for instance the September hare's cautious, long-term approach to share investment, compared with the March hare's approach to high-risk, high-return options trading.

Economics

I got really excited when I started to read Economics: A Little Book of Big Ideas, but my enthusiasm dulled slightly as I went on. It promised a bite-sized approach to understand the big ideas of Economics, but I found it hard to discern a coherent structure.

It is bite-sized - each key economist gets just a double-page spread each - but is arranged by subject rather than chronology. I'm sure there is a structure to it, but it's quite hard to figure out, unless you already know all the stuff you got the book in order to understand.

The language could also be more accessible. However, that's a tall order when balanced against the need to fit someone's life work in two small pages.

So maybe Economics: A Little Book of Big Ideas isn't for beginners like me, but more useful for students of the field who need some quick revision.

More on economics in my review of Das Kapital: A Biography, and my thoughts on why we need to learn about money at Leadership Issues. Plus, a review of the Australian book Affluenza and the book Medici Money.

In coming months: a review of Adam Smith's Wealth of Nations: A Biography.

Book Review: Das Kapital - A Biography

I've got mixed feelings about Karl Marx.

I know him as the alleged father of an ideology that has resulted in more deaths in history than those rendered in the name of religion - a grisly toll which continues to rise today.

I also know him as a denouncer of religion and, together with Freud and Darwin, one of the gods academia chose to replace anything that looked remotely like God.

I've come up against this dogmatic reverence for Marx in, of all places, a book on creative writing. It wasn't so much Marx that annoyed me, it was more the insidious way the author had used Marx, Freud, Foucalt et al to politicise the creative process - a process which I believe to be one of the most creative forces on earth.

So there's potentially a lot to dislike about Marx, judging by his self-proclaimed followers. But there are always two sides to the story; that's why I read Karl Marx's Das Kapital - A Biography.



I also read it because it's part of the Books that Shook the World series, books that offer an accessible “way in” to some of the world's most influential ideas. So far I've read about Plato's Republic, The Q'uran, Thomas Paine's "Rights of Man" and Darwin's Origin of Species. They've not only been excellent history lessons; they've also offered fascinating insights into how ideas take hold and spread.

Das Kapital: A Biography comprises three long chapters, gestation, birth and afterlife. It's far from comprehensive, but perfect for a reader like me who is vaguely familiar with economic issues (though not formally educated in economics) and also relatively up-to-speed with history.

Francis Wheen, the author, paints a picture of a brilliant man driven by his search for underlying truth, but also easily distracted by petty rivalries, and terrible with deadlines (as many great writers seem to be - much to my relief!). What's really interesting is that Marx saw Das Kapital as much as a literary work as a political or economic treatise. In fact this is the book's overall point of view, drawing on quotes from the minority of scholars who recognised this aspect of Marx's intentions.

The first two chapters tell the story of the book's conception and birth, including the muted response when it was published in 1867. The biggest problem was, people couldn't figure out what the hell it was about. This touches on some important issues for any writer - Marx's collaborator Engels tried to persuade him to break down (or break up?) the information into more manageable chunks to reach a wider audience, but,

“'How could you leave the outward structure of the book in its present form!' Engels asked despairingly after seeing the final proofs. 'The fourth chapter is almost 200 pages long and only has four sub-sections...Furthermore, the train of thought is constantly interrupted by illustrations, and the point to be illustrated is never summarised after the illustration, so that one is forever plunging straight from the illustration of one point into the exposition of another point. It is dreadfully tiring, and confusing too.'”

Usability again!

The final chapter then looks at Marx's legacy, as carried forth by George Bernard Shaw, Lenin, Stalin, Mao Tse-Tung, modern academics ... and then it gets really interesting. While Wheen notes that failure of communism in the Soviet Union, and that fact that most ostensibly Marxist countries in the 20th century weren't industrialised nations (the kind Marx said were the only kind ready for a communist revolution), there is a note of hope at the end that really has me thinking. Wheen quotes a number of fairly pro-capitalist authors who reassess Marx's work, going back to what he really said, rather than what others have derived from his “gothic novel” that was Das Kapital.

The book ends - and I hope I'm not spoiling it for anyone - with a theme of revisitation:

“Far from being buried under the rubble of the Berlin Wall, Marx may only now be emerging in his true significance. He could yet become the most influential thinker of the twenty-first century.”

Certainly makes me want to learn more - about Marx, about other economists (my next book to read is Little Book of Big Ideas: Economics) and about emerging models of the way business works - models that more closely match the reality we live in.