This week’s Outside the Box is from my good friend John Silvia, the Chief Economist at Wells Fargo and fishing buddy in Maine. He has written a powerhouse book called Dynamic Economic Decision Making: Strategies for Financial Risk, Capital Markets, and Monetary Policy.
Combining three intellectual disciplines – economics, business, and decision making – that have traditionally been taught separately, Dynamic Economic Decision Making forges a new path that redefines how we view business choices. And that is the main point of the book. So many business leaders and investors make decisions based on static factors, historical patterns, or straight-line assumptions that it is no wonder that all too many bad decisions are made. And worse, we train our MBAs to approach decision making with outmoded tools that have proved themselves worthless in the real world.
Jim McTague of Barron’s wrote:
“For the price of a book you receive the equivalent of a three-credit course from a top MBA program. Silvia, one of the nation's most astute economists, has written a comprehensive, accessible masterpiece on applied economics. The author is an able teacher: Anyone, novice or expert, will profit from this well-written book.”
I agree. Even though John sent me this book for review, I will download it to my iPad for $40! (note to my editor at Wiley, who published this book: Why can Silvia get $39 for Kindle and I get $12?) I get a lot of reading done as I travel, and this is one I want to get through.
I asked John to write a short piece to give us a flavor of his main points, and I don’t think you’ll be disappointed. You can get the book on Amazon at http://www.amazon.com/Dynamic-Economic-Decision-Making-Strategies (37% off).
Have a great week, and learn to enjoy volatility. And please get the fact that Silvia (and I) keep noting: We are not going back to the old days. We are in a brand new world and we need to deal with it.
Your actually looking forward to the future analyst,
John Mauldin, Editor
Outside the Box
Dynamic Economic Decision Making
The Great Recession of 2008-10 demonstrated the power that macroeconomic and financial forces have to alter the risks and rewards that frame choices for both private and public sector decision makers. Moreover, these forces completely overwhelmed the complex, micro mathematical strategies that were the rage of many investors. Yet many approaches to decision-making in finance and economics are more like cookbooks—they tell you how to prepare a specific meal, step-by-step, but…