THE ROAD TO RUIN

James Rickards

Subtitle: The Global Elites' Secret Plan for the Next Financial Crisis, Portfolio, N.Y., 2016, 340 pgs., index, sources, notes

Reviewer comments:

This is another in the author's series on the coming financial crisis due to the explosion of debt and fiat money. It follows his Currency Wars - and The Death of Money. In this book he focuses directly on what he expects will happen when the world experiences another financial crisis similar to that of 2008 due to debt implosion causing a liquidity crisis. This time, he claims, the central banks are prepared for the International Monetary Fund to issue sufficient quantities of SDR as a new reserve currency on which the central banks can then support national banks and other financial instiutions. Otherwise the liquidity crisis will create a massive deflation and many bankruptcies. The chapters are based on his personal activities and interactions with others as his ideas evolve. He combines personal memoir featuring his 'insider' activities with his developing analysis based on the application of his theories. His argument throughout is that the very axioms that are the basis of the FED and government economists are false, so their concepts of financial markets are mistaken and the theoretical models they rely in for making decisions on monetary policy are faulty.

A current essay that reinforces Rickards is by Steven D. Bleiberg, "The Limits of Investment Theory" in the April 16, 2018 Barron's. It is a critique of MPT - Modern Portfolio Theory - in which Bleiberg shows that the fundamental problem is reliance on 'theory'. The application of theory on which he focuses in the concept of 'risk - reward'. The full article is at eipny.com. A similar problem is MMT - Modern Money Theory.

To understand Rickards' methods the reader may find helpful a general knowledge of Bayes' Theorem. See the Wikipedia entry.

And the entry on Bayes method and the entry on Complexity theory and the entry on complex adaptive system.

Introduction:

Mr. Rickards discusses Felix Somary, an Austrian economist whom the author considers an expert in currencies, known as "the Raven of Zurich" for his apparent ability to predict financial and other futures. Rickards writes that Somary was employing Bayesian statistics and behavioral psychology. Rickards does not think much of most economists.

He writes: "Economics is a science, yet most economists are not scientists. Economists act like politicians, priests, or propagandists. They ignore evidence that does not fit their paradigms. Economists want scientific prestige without the rigor." He describes what he considers as the proper scientific method using either inductive or deductive development of an hypothesis that is then subject to rigorous testing before being accepted or rejected as a theory. He comments on the 'Austrian school', on Lord Keynes, and the Milton Friedman monetarists and finds fault with all three. His comment on Friedman is especially interesting.

Friedman claimed that maximum economic expansion with stable prices required a steady but slow growth in the money supply. This idea he developed from Irving Fischer's theory including the concept called 'velocity'. This is stated in the formula MV=PQ meaning that money times velocity equals nominal GDP consisting of real GDP (Q) adjusted for changes in the price level (P). And he claims that Friedman assumed that velocity is constant. Professor Mishkin shows that Fischer's belief in constant velocity no longer is accepted and Rickards agrees. And Friedman assumed that P=1. Friedman's idea then was that increase in M would match increase in Q. And Rickards states that Friedman's idea is worthless - hence Monetarism is not valid.

The history of these theories is discussed in Lawrence White's The Clash of Economic Ideas, in Jerry Muller's Thinking about Capitalism and in Frederick Mishkin's Money Banking & Financial Markets among other references - see list below.

His result: "Prevailing theory does even more damage when weighing the statistical properties of risk". Furthermore, "The extended balance sheet of too-big-to-fail banks today is approximately one quadrillion dollars, or one thousand trillion dollars poised on a thin sliver of capital." Rickards then considers the prevailing theory called 'value at risk' which assumes that long and short financial positions balance to a net and that extreme events are rare. But extreme events are not rare. (See Nassim Taleb's several books). Rickards writes that all four assumptions supporting 'value at risk' are false. He then summarizes that monetarists, Neo-Keynesians and VaR users all are using obsolete tools but insist on sticking with their models. He compares this predilection to others in history and blames human psychology. That is sticking with a belief even in the face of opposing evidence because doing so is more comfortable. He adds the reliance on 'elegant mathematics' and inertia plus belief in certainty over uncertainty and academic mentality.

All these denunciations lead to Rickards' statement that his book, here, is about "what works". His work, then, is based on three "important new tools": Behavioral psychology, complexity theory, and causal inference.
For behavioral psychology he cites Daniel Kahneman.

He describes complexity theory as having four attributes; diversity, connectedness, interaction, and adaptation. The question is: Are capital markets complex systems. The third tool is the application of Bayesian statistics (causal inference). He notes that: "Bayesian probability posits that certain events are path dependent, meaning that future events are NOT independent, random (like coin tosses) but are influenced by the long series of prior events. Rickards claims that economists reject using Bayesian methods because they are too difficult, but that, for instance, intelligence agencies and nuclear scientists have adopted them. (See Philip Tetlock's Superforecasting: The Art and Science of Prediction) .

In conclusion he writes: "This book parts ways with the "Big Four" schools - classical, Austrian, Keynesian, and monetarist." And continues by again summarizing their shortcomings.

Chapter 1 - This is the End

The chapter is about ICE-9, a central theme of the book. The scene opens in a New York restaurant and the time is summer, 2014. Rickards is discussing government interventions in the financial market with a BlackRock expert who has mentioned Larry Fink's directions for BlackRock and his interactions with the Federal government. It seems the government wants to add BlackRock to its list of G-SIFI (globally systemic important financial institutions) That means government ability to exercise control when it considers it necessary. Of course Black Rock sought to avoid that. Rickards explains the ramifications of such actions. Among them would be the government ability to order BlackRock to take specific actions against its will, such as freeze all accounts. Freeze - as in ice. This leads to the central theme.

Ice-Nine
Rickards has a habit of creating metaphors and using literary references. In this case Vonnegut's science fiction concept of a special type of H2O that could freeze the world. His theme, then, is that in a world financial panic - a liquidity crisis - everyone wants their money now and banks do not have it. (The long history of bank failures from 'runs' is well known. The government solution is to 'freeze' all monetary accounts. (Like FDR's bank holiday). Since financial institutions (especially banks) are central actors in the complex networks that constitute modern dynamic systems these 'runs' or other liquidity failures spread 'freezing' the whole system. So Rickards tells the readers that "Ice-nine is hiding in plain sight.".. "Ice-nine global rather than case-by-case". He cites specific recent cases, such as Cyprus and Greece. And he notes specific international financial leaders attending conferences. Another sign of what is coming is the increasing public recommendations that 'cash', that is currency, be eliminated and all monetary assets be limited to digital accounts in government supervised institutions. Holding cash outside banks would be the citizen's response to thwart the government 'ice-nine' policy. He devotes pages to explanations of the widespread ramifications of a govenment 'ice-nine' edict.

House Closed
In this section he insists that the typical public disbelief that a "ice-nine' policy could occur is naive - history is replete with similar events.

The Money Riots
In this section Rickards describes the time between 1971 and 1980 as chaotic. He comments on the failing efforts of monetarists and Keynesians to respond to the volatile financial scene. The establishment solution was simple - Print Money - But is did not solve but rather made the situation worse. He describes the events surrounding the 2008 financial crisis.

Chapter 2 - One Money, One World, One Order

Rickards again refers to 'literature', well, at least to a book. This is Ian Fleming's Thunderball the venue for SPECTRE. His analogy is that the criminal organization - SPECTRE - is similar to legal NGO's and the IMF.
His shorthand: "True elites operate inside spheres of influence."... "These super-elite venues are not run-of-the-mill industry conventions."... "Elite spheres float and overlap like an interactive three-dimensional Venn diagram.'

Now all of this is described in Niall Ferguson's The Square and the Tower. in which he focuses on the conflict between network structures and hierarchial organizations.

World Money
In this section Rickards relates the early uses of gold and silver as international 'money' with today's methods in which 'fiat' money has taken the place of gold. He describes FDR's edict that prohibited private ownership of gold. He predicts, "The next collapse will see world money's reemergence. ...The chosen instrument is neither the dollar nor gold, but SDR's". He describes what a SDR is and what its role will be.

World Taxation
In this section Rickards cites his personal experience working for Citibank in international taxation issues - that is how to avoid taxes as much as possible- or rather how to pay just enough to keep governments away. He describes many of the techniques to achieve this. And of course governments are out to stop this nefarious practice by instituting a world financial system that will enable taxation on a world basis.

World Order
In this section Rickards first notes that many have striven to establish a world polity without success beyond a geographical area. But now the tools are available to create a real, all encompassing world order. He provides the reader with a brief excursion into the history of some empires. Then to the present, he discusses some new features that proponents cite as demanding a 'world order', such as digital threats, climate change, and extreme differences in local or regional wealth and poverty.
Specifically, he writes, "The linkages among climate change, SDR's, the IMF, World Bank, and the need for global coordination could not be more explicit."

Shock Doctrine
In this section he again finds an analogy in Naomi Klein's book The Shock Doctrine. The book describes how elites can use shock to advance hidden agendas. Sure enough, President Obama's henchman, Rahm Emanuel, revealed the modus operandi to 'never let a crisis go to waste'.

Chapter 3 - Desert City of the Mind

The subject is complexity theory. The chapter is another opportunity for Rickards to describe his personal role, his visit. In this case the 'desert city' is Los Alamos - a super secret venue inhabited by super brainiacs. It is a major node in another network, the government advanced research apparatus that expanded and evolved from the WWII atomic bomb development organization.

Capital and Complexity
In this section Rickards describes the use of the powerful computers today in the study of extremely complex systems. Among these are efforts to predict developments - evolutions - of such a system. For this Bayes' theorem can be used. He gives us the basic mathematical equations.

Tetlock informs us that some of the best forecasters in his experiments use the fundamental Bayesian method without knowing about it. The basic idea is to begin with a probability based on the cumulative knowledge one already has, if that is a pure guess it might be 50/50. Then continue to collect separate bits of knowledge each of which might itself have a probability such as 70/30 and adjust the original number mathematically. Continue by integrating successive bits of knowledge. Rickards provides examples.

Complexity
In this section he again points out that capital markets are complex systems but even so are little understood or considered. He discusses Edward Lorenz's experiments. He explains: "Complex theory begins with two tools; an agent that acts in the system and feedback - the effect of subsequent events back on the initial ones to produce a new event.

(Rickards does not mention this, but it appears to be similar to Hegel's dialectic.)

Rickards gives examples such as the actions investors take having seen Buffett's actions in the market. Much math follows. He disagrees with Burton Malkiel's famous concept of 'the random walk'.

Chapter 4 - Foreshock: 1998

In this chapter Rickards details the events surrounding the famous collapse of Long-Term Capital Management in 1998. He does provide many interesting details about the specific ideas and actions of the leading characters based on his own activity. He joined LTCM in 1994 and remained there until 1999. His subsequent analysis was based on his subsequent study of complexity theory. Again, he provides examples. The chapter is well worth its study.

Chapter 5 - Foreshock: 2008

In Rickards' opinion. "From the perspective of complexity theory the 2008 collapse was easily foreseen."
Well it was foreseen by quite a few investors and market analysts some of whom chose to warn the public and politicians, and some of whom chose to benefit themselves by quietly executing shorts and other transactions.
Rickards describes his own efforts to give warning, even directly to government officials, but he was ignored. He then describes some of the results.

Chapter 6 - Earthquake: 2018

Rickards is again warning about the danger of financial instability in personal discussions with officials. His conclusion was (and is) that the FED economists and officials were persevering in relying on their erroneous models. One comment: "There's nothing new about economists' inability to foresee panics." He does cite Jeremy Stein and Rick Mishkin as two who are making progress in understanding financial complexity. He contrasts the approaches taken by 'frequentists' and "Bayesianists'.

Gold
In this section Rickards makes an argument for investing in gold. He claims that, "Gold is the world's least understood asset class. Confusion arises because gold is traded like a commodity, yet gold is not a commodity, it is money." He claims that gold is money because central banks hold tons of gold in their vaults. Further, he claims that, "Gold will beak out toward its intrinsic monetary value of $10,000 per ounce, versus the current commodity value of $1,400 per ounce...." He continues with examples. He does provide some excellent real world examples of what goes on each day in the gold market. There is much information here to cause individuals who are investing in gold, especially paper gold, and futures to be very concerned. In this he is pushing his books. and The New Case for Gold.
But I disagree with his fundamental concept as stated above. Because gold has NO intrinsic value since Nothing has intrinsic value because value is not an attribute that can be attached to any good or service. Value is a psychological attribute inside the individual's brain, not attached to any object. To claim that gold has intrinsic value is the same as to claim a glass of water has intrinsic value. However, it is the very nature of gold (and everything) to have relative value depending on circumstances that makes it sometimes a very significant investment worth holding.

The Dollar Shortage
Now in this section Rickards is providing the readers with a very important view of what is going on in the world financial markets with respect to the real money supply. He presents some data on the massive expansion of debt (credit) by the world's banks and how it has been leveraged as much as 50:1 by various kinds of derivatives. And this relates in a complex way to inflation and deflation.
One of his conclusions is: "The world is a minefield of bad debt waiting to detonate into a generalized dollar liquidity crisis." He continues with more dire predictions.
The idea that there could be a 'dollar shortage' or a 'shortage' of whatever is being used as the medium of exchange in the daily markets - which history shows has indeed been the case with some frequency (for instance in silver)- is another fact that dispels the concept of 'velocity'. If the market required a greater volume of 'money' to meet demand an increase in 'velocity' would solve the problem.

Chapter 7 - Bonfire of the Elites

This chapter opens on the Serengeti plain where lions prey on wildebeests. Today our financial lions are the likes of Mario Draghi, Christien Lagarde and Larry Summers. The wildebeests are the rest of us. Rickards denounces the entire ruling economic theory that the elite 'lions' claim provides legitimacy for their manipulation of the money supply - the credit markets. Markets are NOT efficient, as they claim. "Eqilibrium is a facade that masks unstable complex dynamics." He asks, "If elite consensus is so flawed, why has the consensus persisted so long?" His answer is that it has not actually 'persisted' for long but its components - monetarianism, Keynesianism, efficient markets theory, rational actors, and the other intellectual fads are relatively recent. But it is all absurd. Also, individual actors and the market in total are NOT Rational.
Also, "General equilibrium models also suffer from a fallacy of composition." ... "The fatal flaw in equilibrium models is that the degree distribution of market price movements is assumed to be shaped in a bell curve, or so-called normal distribution. The difference between a bell curve system and the alternative power curve system is not just a dusty academic debate over the shape of two curves."

Rickards metaphor of the lion and wildbeests was a central concept of Machiavelli's psychological view that human conflict consists of that between those whose main motivation is domination and those whose motivation is to prevent being dominated. And Darwin sought to frame the same conflict by excluding a human motivation by stating that it was an evolutionary constant of all species resulting in 'the survival of the fittest'.

Apple and the Cat
"General equilibrium, rational expectations, and efficient markets are not the only fallen pillars of the elite edifice. Free trade is another myth."
His metaphor is the contrast between the market activity and results of Apple Corp. and Caterpillar Corp. Rickards discusses 'free trade' as a development from David Ricardo's theory of comparative advantage described in his book - The Principles of Political Economy and Taxation(1817). Rickards believes the concept now fails in an era of globaliztion. It rests on the term 'comparative'. He claims this rests on the concept of efficiency. He lists some of the key factors of production that must be measured in order to establish relative efficiency. Then he points out that these now are manipulated and therefore there is no basis for comparison. Smith's and Ricardo's analysis relied on the existence of the gold standard to enable comparisons of nation's money. Now that is not possible. Today terms of trade are manipulated in floating exchange rates.

Rickards' point is: " Floating exchange rates enrich currency traders and speculators but add costs to commerce and impede capital flows." ... "The next deficiency in the free trade case is mobility of factors of production." He continues by examining a series of defects that make 'free trade' not the reality. He writes much more. His summary: "The issue is not that Rickarian theory is wrong; it is that the theory relies on assumptions that don't conform to the real world, and is therefore useless as a guide to policy." He continues by noting the influence of the relative 'value' of the dollar - either 'weak' of 'strong' on the competitiveness of American domestic versus multi-national corporations.

He recommends a combination of a high tariff on all imported goods and a cut in payroll taxes to make the result revenue neutral and enable American consumers to afford the higher relative costs of the imported goods. And he gives a lengthy series of arguments in support of his claim for advantage. He claims the result will be to bring manufacturing back to the U.S. without net cost to the public.

Empire of Debt.
He repeats his summary: "The elite world-view rests on the intellectual pillars of equilibrium models, monetarianism, Keynesianism, floating exchange rates, free trade, globalization, and fiat money. Meanwhile, the real world is best understood through the lens of complexity theory, conditional probability, behavioral psychology, currency wars, neomercantilism, and gold." He contrasts the economic and financial conditions of the postwar 1950-60's with the conditions subsequent to the abandonment of the gold standard and then the financial peg to the dollar. He describes the decline that began in the 1990's. His discussion shifts to the huge explosion of credit- debt since then with citations on the size of various measures of debt.

In the remainder of the chapter he describes the coming results of all this and proposes several 'radical' political - economic measures that would counter the coming collapse.

Chapter 8 - Capitalism, Fascism, and Democracy

Many readers won't understand this chapter and many will dispute Rickards' conclusion. But the chapter is full of detailed data and quotations in support of his arguments.

Schumpeter Reconsidered
Rickards devotes pages of attention to Schumpeter's contribution to economic theory. He notes the major attention that has been paid to Schumpeter's concept of 'creative destruction' - the idea that innovation fostered by the entrepreneurial side of capitalism destroys the old as it creates the new. He notes that also Schumpeter predicted (favorably) that capitalism would lead to socialism. Rickards believes that Schumpeter was correct, but he was not thinking of Marxian socialism. Rather Schumpeter expected the expansion of "state' socialism' - that is the expansion of control by 'central planners' - the elite establishment - who would rely on and favor the support of the working class at the expense of the 'middle class'. Rickards cites considerable statistics to show that this has happened and is happening. He writes: "Schumpeter diagnosed capitalism's decline with uncanny accuracy."

The conflict between three forms of 'welfare state'; entrepreneurial, managerial and mercantilist is the central prediction of Philip Bobbitt in his 'must read' book - The Shield of Achilles. Frederick Hayek warned about this future in his Road to Serfdom

Rickards summarizes this section: "The rise and fall of civilizations is the grandest example of complexity theory applied to human affairs." (See Tainter, below)

The New Praetorians
Rickards' poses the analogy of the Roman Praetorians (established to protect the emperors), but they evolved into the armed forces which could create and destroy emperors. Likewise today. He writes: "The ideal American Republic is no more than a comfortable myth today; new praetorians are here now, inside city walls, in the service of elites." But so far their influence and power has remained hidden and mostly potential. He writes that their power rests on four legs - criminalization of every day behavior, politization of justice, militarization of police, and digitization of surveillance. He cites many specific examples fully exposed in the media.

The New Fascism
This is a section likely to be disbelieved and disputed by many readers. Its validity depends on an understanding of what 'fascism' really meant in theory and practice, something unknown to most Americans who have been taught entirely different meaning of the term. He provides the 'seminal definition of fascism by quoting Woodrow Wilson. A quotation worth repeating here.

"The President is at liberty, both in law and in conscience, to be as big a man as he can. his capacity will set the limit; and if Congress be overborne by him it will be no fault of the makers of the Constitution... but only because the President has the nation behind him and Congress has not."

And, "Government does now whatever experience permits or the times demand."

In theory and practice "Fascism' is actually 'state socialism' legitimized as the benign operation of the 'welfare state'. Fascists are happy to allow private enterprise to have legal ownership of economic institutions, while the government (under the justification of 'reasons of state' controls all action (results) via extensive rules and regulations - especially over the four 'commanding heights' (energy ,education, health, and finance.)

Rickards describes Wilson's implementation of fascist control, using the excuses of World War I necessity. He comments; "Hitler and Mussolini referred to Wilson with approval in their own writings and adopted his repressive tactics as part of Italy's fascist movement and Germany's National Socialism movement." He describes at length with specific examples how Hoover, FDR, and LBJ expanded on it.

Money Nexus
Rickards returns for more discussion of Schumpeter's vision. He then brings up Bismarck (belatedly I believe) by noting that is was Bismarck who invented and created the first 'welfare state' for political purposes - to preempt socialists and prevail on the many independent German mini-states to accept the Prussian King as the German Emperor. Rickards does not mention that Schumpeter was strongly influenced by and supported the German Historical School of economics professors who developed the modern economic theories that supported Bismarck and the Kaiser.

Rickards concludes the chapter with further description of fascism in the United States today.

Chapter 9 - Behold a Black Horse

In this chapter Rickards focuses on the coming future - sure to have another financial crisis - a worse one than in 2008.

Countdown Clock
Rickards begins: "Complexity theory says we will not know the time of the next financial collapse in advance." ... "Complex systems in the critical state are fragile constructs with countless points of failure catalyzed by immeasuable small causes. That dynamic makes systems failure certain." He cites the example of prediction of earth quakes. Then he discusses in detail with dates and results a number of well known financial crises of the past 50 years as financial 'foreshocks'.

This is one of the most authoritative and well grounded sections. It should be studied carefully in conjunction with Ferguson's Square and Tower and Fox's The myth of the Rational Market.

Incoherence
Rickards again: "The international monetary system is now in a time of dynamic uncertainty. This dynamic resembles the phase from 1971 to 1981 when extremes in inflation, interest rates, commodity prices, and exchange rates, and geopolitical instability pushed markets to the edge of chaos until Henry Kissinger, Paul Volcker, Ronald Reagan, James Baker and later Robert Rubin provided the leadership and enlisted the international cooperation needed to reestablish the former Bretton Woods gold-based system around a new dollar-based one." He believes a similar move is underway now - the theme of his book. The validity of Rickards' descriptions of moves in the FOREX - currency markets can be followed daily on line in Daily Pffening. He lists the major steps he believes the international financial officials are taking.
1 Capture the banking system, 2009-10
2 - Redistribute gold to China, 2009-16
3 -Redistribute the SDR, 2015-16
4 - Print and distribute SDR's 2017-18
5 - Destroy debt by inflation, 2018-25
The problem with this policy is that the world entered a epoch of deflation in the late 1990's and so far the central banks have been unable to do more than reduce it. It significant deflation continues the financial authorities would need to employ the 'Ice-nine; methods described above plus the 'shock doctrine and a further war on cash. With implementation of the inflationary debt reduction policy governments would be winners and investors who were caught unawares would be losers.

Palazzo Colonna
Rickards again touts his own experience by using a meeting at the Palazzo Colonna in Rome as the venue for an example of the ability of powerful families to preserve their wealth over centuries and generations. He cites the advice of the Colonna - place a third of investment in each of fine art, real estate and precious metal. Then he cites his own and Nassim Taleb's testimony before Congress on risk management. Their advice has not been taken, he asserts. His own formula for defensive asset allocation follows:
10% physical gold and silver;
30% cash;
20% real estate
5% fine art
10% angel and venture capital;
5% hedge funds;
10% high quality sovereign bonds; 10% stocks in natural resources, mining, energy, utilities and tech

Conclusion

A final example of Rickards in action - this time in a debate on the broad course of future national power. His argument was about the danger of enormous debt and the coming financial collapse. He justified his assessment by the historical record back to civilization collapse in the Bronze Age. (Again, see Tainter).

Some references- All of these provide insight into the failures of current economic theory about risk, money and the nature of markets leading up to the financial crisis of 2008. They should be studied together. The links are to the publisher information and the file in which I am gradually writing my review and comments.

David Hackett Fischer - The Great Wave
The author provides statistics and analysis of the waves of price increase and decrease in Western History since 1200. In a super appendix he describes the same establishment demand from students for theory over facts that Rickards mentions.

L. Randall - Wray - Modern Money Theory
This is an amazing effort to justify the modern 'chartalist' theory that legitimizes government use of manipulation of money to achieve its political objectives.

Frederick S. Mishkin - The Economics of Money, Banking & Financial Markets
A huge and detailed text book on all aspects of the topic. The author descries the development of the economic theories that Rickards denounces.

Henry Kaufman -Tectonic Shifts in Financial Markets
The author was at the center of the 'tectonic shifts' he describes. He identifies who was responsible for the changes.

Joseph Tainter - The Collapse of Complex Societies
The author is an archeologist - anthropologist who mostly studied Western hemisphere ancient civilizations. He developed his theory on collapse that focuses mainly on how as societies become more complex the demand on energy resources to simply keep it going eventually exceeds the capacity.

Douglas W. Hubbard - The Failure of Risk Management
Another detailed description of the 2008 financial crisis in terms of the officials failure to recognize and deal with risk.

Peter L. Bernstein - Against the Gods: The Remarkable Story of Risk
A historical study of scientific developments on thinking about risk from early ideas about gambling and probability to the present.

Justin Fox - The Myth of the Rational Market: A History of Risk, Reward, and Delusion on Wall Street
The author covers much of the same terrain as Rickards with similar conclusions about the fundamental fallacies. He also names the economists responsible.

Jerry Z. Muller - Thinking about Capitalism
Each chapter is devoted to one or several philosophers who wrote in support of or opposition to the social - cultural results of capitalism.

Jerry Z. Muller - The Mind and the Market A briefer list of the above authors.

Lawrence White - The Clash of Eonomic ideas.
This is a remarkable study, based mostly on the professional economic literature, of the conroversial way in which 20th century economic theory has developed. Lord Keynes and Frederick Hayek are two of the major contenders.

Philip Tetlock and Dan Gardner - Superforcasting: The Art and Science of Prediction
The authors have conducted and continue to conduct experiments with volunteers testing the ability of individuals to predict future events or trends - and discussion of the meathods the more successful individuals use.

Danielle Dimartino Booth - FED UP: An Insider's Take on Why the Federal Reserve is Bad for America
The author worked inside the FED and observed first hand the problems Rickards and others have identified.

Rana Foroohar - Makers and Takers: The Rise of Finance and the Fall of American Business
A devastating report on the process by which the financial 'industry' has damaged the real productive business world.

Daniel Kahneman - Thinking Fast and Slow
The author won a Nobel Prize in economics even though he is an experimental psychologist. His findings about the real nature of decision making forced economists to change some basic beliefs about 'rational man'.

Nassim Nicholas Taleb - The Black Swan
Another devastating critique of the financial industry that bases its activities on theories that fail to account for the real likelihood of failure.

Nassim Nicholas Taleb - Fooled by Randomness
Further expansion of the author's critique of how financial leaders deal with 'risk'.

Nassim Nicholas Taleb - Antifragile
In this book the author advances his theories to contend that it is not enough to seek to reduce risk by attempting to prevent disruptions. Rather he recommends betting on investments that will actually benefit from disruption. His ideas relate to those of Rickards.

Niall Ferguson - The Square and the Tower
The author examines the fundamental conflict throughout history between organizations that are based on hierarchy and those that are based on networks. And he indicates that networks are growing now.

Philip Bobbitt - Shield of Achilles
The best book on the history of the creation and development of the concept of 'the state' since circa 1500 and its potential future in the 21st century. The author devotes much attention to the philosophers who became recognized as supporters and theoretical descriptors of the political reality at each stage. With the modern expansion of politicians' need to address economic issues (since the advent of the welfare state) the legion of economists has superceded the clerics and others who dominated in the field of providing justification for politicians.

Frederick Hayek - Road to Serfdom The devastating critique of socialism that Rickards believes has been victorious.