Books of the Year: Of villains, speculators and weird science

Consultant Jennifer Harris talks us through her top books of 2010, from the Big Short to Jilly Cooper...

by Jennifer Harris
Last Updated: 10 Dec 2010

I was 15 when I read my first real business book and I remember thinking how well it compared to the Jilly Cooper novels that were required reading at the time. The book was Michael Lewis's Liar's Poker, a kiss-and-tell of City debauchery in the 1980s, which was and remains a compulsive read. So I had high expectations of Lewis's latest book, The Big Short, and, true to form, it's another classic.

The Big Short provides a vivid account of the recent housing and credit bubble, as seen through the eyes of a handful of speculators, and the weird and wonderful characters at the centre of this book distinguish it from the many economic essays on the recent crisis.

Take Dr Michael Burry, the one-eyed neurologist with Asperger's profiled by Lewis, who says of himself that his 'nature is not to have friends'. Burry had developed the highly unusual habit of reading subprime mortgage bond prospectuses from cover to cover, which helped him to confirm that something strange was happening in the mortgage market. Having dropped out of medicine to raise a fund, he took a bold short position in the subprime market in 2005.

So bold, in fact, that many of his investors wanted out. He resorted to locking them into his fund and, when eventually proved right, generating a return of almost 500%, but he says: 'Nobody came back and said: "Yeah, you were right." It was very quiet. It was extremely quiet.' Burry is just one of the eccentric high-rollers profiled in The Big Short, alongside the Cornwall Capital trio who set up shop in their garage and turned $100,000 into $120m and Greg Lippmann, a Deutsche Bank trader who made $100m in a single week.

In Sebastian Faulks's latest novel, A Week in December, set at the end of 2007, evil hedge fund manager John Veals plots to bring down a major bank for his own financial gain. After reading about the colourful characters in Lewis's book there seemed little need to create fictional ones but, regardless, this is an enjoyable light read.

But for real villains, a few greedy hedgies don't come close to the characters in the new book by former BBC Moscow correspondent Martin Sixsmith, who lived and worked in Russia for many years.

With my boyfriend about to join an oil trading company, I felt I should make an effort to learn about the industry and Putin's Oil seemed a good place to start. Not only will this book put you off the oil industry, it will put you off Russia, politics and big business all in one go.

Khordokovsky, the king of Russian oligarchs who was jailed for fraud in 2003, had half the Russian government in his pay and an uncanny number of people whose interests didn't match his own seemed to come to a sticky end in the years before his arrest. The other oligarchs are painted similarly unflatteringly and politicians come out of it no better. Sixsmith's thesis is that Putin's motive for cracking down on the oligarchs is so that he can get his own hands on their assets. He's just another oligarch in politician's clothing - one former colleague estimates Putin to be worth over $40bn.

To take the edge off the gloom, I enthusiastically reached for Jilly Cooper's latest novel, Jump, when it came out in the summer. But, unlike Michael Lewis, I don't think she has recaptured her earlier form. The first 11 pages are dedicated to listing the cast of characters, including two pages of pet animals.

It has a fairly shallow plot and trying to keep all the characters in your head is more mentally taxing than any description of Dr Michael Burry's credit default swaps or Putin's money-laundering. Instead, for some first-class light relief, I would recommend The Hair of The Dog by Karl Sabbagh, which explains all sorts of weird and wonderful scientific facts.

Did you know mushrooms are half animal, half plant? Or that the nausea you get with a hangover is caused by a mismatch between the density of the blood and that of the fluid in the inner ear, which explains why a hair of the dog works. If you remember one thing from this article, keep hold of that fact as the party season approaches.


The Big Short
Michael Lewis
Allen Lane £25.00

A Week in December
Sebastian Faulks
Vintage £7.99

Putin's Oil
Martin Sixsmith
Continuum £16.99

The Hair of the Dog
Karl Sabbagh
Hodder Stoughton £12.99

Jennifer Harris is founder and managing director of JRBH Strategy & Management

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