I was thinking about putting up a post describing my favorite books. Thanks to Varnam for tagging me as a part of the book tagging meme.
Total number of books I own: Close to 500. Most of the books I read during earlier days were borrowed from some library. However, after coming to US, I prefer to purchase and collect books.
Last book I bought: Brian Greene: The Elegant Universe: Superstrings, Hidden Dimensions, and the Quest for the Ultimate Theory. The book does a great job in explaining the existing theories, such as Quantum Mechanics and theory of Relativity (both Special and General) and explains very nicely how they are incompatible with each other presently. But it lost me when it came to explaining the various strings theories that are supposed to solve the incompatibility between the Quantum Mechanics and the Relativity theories.
Last book I read: The same as above. My rate of buying and reading books have slowed considerably as I spend most of my reading time on line. With so many interesting blogs and web sites to read, I am never short of reading material.
Five Books That Mean a Lot to Me:
I will take a little liberty here with the book meme and present themes, each illustrated with a series of books. Books rarely stand alone. They present an theme that is then carried by or criticized by other books. Here are the major themes that influenced me the most:
- Intelligent Investing
It all started with Benjamin Graham: The Intelligent Investor: The Classic Bestseller on Value Investing. From reading the Motley Fool site, I become interesting in investing philosophy of the super-investor Warren Buffett. Ben Graham is a mentor of Warren Buffett and other super-investors of Graham-and-Doddsville and after reading this book you will see why! After this, Benjamin Graham: Security Analysis: The Classic 1934 Edition followed almost naturally. This book is more technical in nature and it will be more useful if read in parallel with a basic course in Accounting. Ben Graham distinguished between speculation and investing: "In speculation when to buy -- and sell -- is more important than what to buy, and also that almost by mathematical law more speculators must lose than can profit." Ben Graham's investment strategy was more defensive in nature, nick-named "cigarette butt" for its focus on bargain-basement value stocks. Ben Graham introduced very useful concepts in these two books. One famous was, "Mr. Market", as a proxy for the emotional investors who are "most optimistic when prices are highest and most despondent when they are at their bottom?". Unlike Ben Graham, who focused on crunching objective numbers, Philip Fisher was a master of locating and investing in quality businesses through research. In this great book, Philip A. Fisher: Common Stocks and Uncommon Profits and Other Writings (Wiley Investment Classic), he lays out his investment philosophy in a great detail. Warren Buffett combined the philosophies of Ben Graham and Philip Fisher, and consists of purchasing quality companies at discounted prices, thus maintaining a significant margin of safety. This book, Robert G. Hagstrom: The Warren Buffett Way, : Investment Strategies of the World's Greatest Investor, will give you a unofficial but very useful overview of Warren Buffett's investing strategy. I liked this book because it actually laid out out operational details of executing an investing strategy rather than just describing at a philosophical level. This changed my attitude to, well almost everything! One cannot even talk about investing without mentioning Peter Lynch, the legendary former star manager of the Fidelity Magellan Fund. This book, Peter Lynch: One Up On Wall Street : How To Use What You Already Know To Make Money In The Market, is a very practical and useful. If you don't want to spend years trying learn financial analysis like Ben Graham or research companies like Philip Fisher, or do not have capabilities of Warren Buffett, then this book is for you. In a simple but insightful manner, Peter Lynch writes how ordinary investors can profit from the information they already know or regularly encounter, such a from products they regularly use. I wouldn't have dared to invest on my own without this book. Philosophies and strategies make a fine reading and are useful only as a framework for thinking and analysis. However, you need practical examples and hand-holding when you are just starting on your own. This book will give you the confidence and practical guidance that is needed to start your own portfolio.
I would recommend these books to everyone, even if one is not interested specifically in investing! You need to analyze and compare various opportunities in a cool, unemotional manner. I learned this painfully in my career when I decided to pursue an opportunity based mostly on the compensation and got badly burned. Had I read the books earlier I would have never taken employment at a company whose success if more hype than reality. At a minimum, I would read and analyzed the annual reports of the company. Another useful lesson I learned from these books is that you should never get swayed by established or conventional wisdom and group-think. You can benefit from the rare opportunities only if you are ready to go against the stream and have patience. This applies as much to ordinary life as it applies to the investing. I recovered the cost of these books (including the time spent in reading those books) thousand times over. I keep going back to these book time and again and every time I learn something new. That's a sure sign of a great book.
- Philosophy of Liberty
As far back I remember, I loved to do things my own way and abhor-ed discipline and top-down imposed discipline. And I was never shy of selffishness. And my favorite past time is arguing with my parents, wife, friends and relatives endlessly on politics, liberty, economics and in general about philosophy. So, when I came across books, such as, Leonard Peikoff: Objectivism: The Philosophy of Ayn Rand (The Ayn Rand Library, Volume 6), Milton Friedman: Capitalism and Freedom, F. A. Hayek: The Road to Serfdom, and others (see the Reading list, titled, Philosophy of Liberty, at the bottom-right), I swallowed them one after another like a crazy person. I also loved the Ludwig von Mises: Human Action: A Treatise on Economics.
I was always fascinated by Mathematics, Physics, Astronomy and Computing. The school and college level mathematics and physics in more mechanical in nature with emphasis on practice.I am very fascinated by books that try to interpret Modern Physics theories and try to connect them to our ordinary experiences. I started with Stephen Hawking: A Brief History of Time. I liked it as it attempted to fit many physics theories that I was familiar with into a nice theme. I simply loved Roger Penrose: The Emperor's New Mind for its fascinating take on artificial intelligence drawing from physics, mathematics and other branches of science. Brian Greene: The Elegant Universe: Superstrings, Hidden Dimensions, and the Quest for the Ultimate Theory introduced me to the Superstring and other modern physics theories in a very gentle manner and also clarified my understanding of the Special and General Relativity theories and Quantum Mechanics.
These books do not fall into any specific themes. I liked many of John Grisham's novels, such as, John Grisham: The Last Juror, as they are not only entertaining but full of court dramas and legal subtleties. I also enjoy reading autobiographies and biographies for the inspiration they provide and they allow me to peak inside the lives of great people. The last one I read, Howard Schultz: Pour Your Heart into It : How Starbucks Built a Company One Cup at a Time, was simply great! It reinforced in me the theme that in order to be successful you have to be different and also you need to swim against the tide.