David Warsh: Of shadowy commodities traders, ‘tropical gangsters’, deluded crowds
At the Chicago Board of Trade before the pandemic
SOMERVILLE, Mass.
Because my tastes are well-established, I sometime receive new books that otherwise might escape readers’ attention. Herewith some recent arrivals.
The World for Sale: Money, Power, and the Traders Who Barter the Earth’s Resources (Oxford), by Javier Blas and Jack Farchy. A pair of former Financial Times commodities reporters, both now working for Bloomberg News, Blas and Farchy explore the shadowy world of billionaire commodity trading firms – Glencore, Trifigura, Vitol, Cargill, and the founders of the modern industry, Phillip Brothers and Marc Rich. Firms and individuals whose business is trading physical commodities – fossil fuels, agricultural commodities, metals and rare earths – enjoy a unique degree of privacy and autonomy, except from market forces. Blas and Farchy illuminate the goings-on in an otherwise almost unnoticed immense asset class ordinarily tucked away in the interior of newspapers’ financial pages.
The Culture and Development Manifesto (Oxford), by Robert Klitgaard. Remember Tropical Gangsters: Development and Decadence in Deepest Africa?
The New York Times Book Review called Klitgaard’s tale of adventures during two-and-a-half years in Equatorial Guinea one of the six best nonfiction books of 1990. The author is back, summing up various lessons learned during 30 more years advising nations, foundations, and universities on how to change (and not change) their ways. Why a manifesto? His determination, with the same good humor as before, to persuade economists and anthropologists to work together, the better to understand the context of the situations they seek to change.
The Day the Markets Roared: How a 1982 Forecast Sparked a Global Bull Market (Matt Holt Books), by Henry Kaufman. What was Reaganomics all about? Plenty of doubt remains. There is, however, no doubt about the forecast that triggered its beginning. Salomon Brothers’ long-time “Dr. Doom” recalls the circumstances surrounding the “fresh look” he offered of the future of interest rates on Aug. 17, 1982. In doing so, he reconstructs a lost world. The Dow Jones Industrial Average soared an astonishing 38.81 points the next day – its greatest gain ever to that point.
The Delusions of Crowds: Why People Go Mad in Groups (Atlantic Monthly Press), by William J. Bernstein. A neurologist, author of The Birth of Plenty: How the Prosperity of the Modern World Was Created (McGraw-Hill, 2010), Bernstein tracks the spread of contagious narratives among susceptible groups over centuries, from the Mississippi Bubble and the 1847 British railway craze to the Biblical number mysticism of Millerite end-times in 19th Century New England and various end-time prophecies in the Mideast. Such behavior is dictated by the Stone Age baggage we carry in our genes, says Bernstein.
Albert O. Hirschman: An Intellectual Biography (Columbia), by Michele Alacevich. It was never hard to understand the success of Worldly Philosopher: The Odyssey of Albert O. Hirschman, by Jeremy Adelman, a Princeton University professor and personal friend of the economist and his wife. Hirschman cut a dashing figure. He fled Berlin for Paris in the ’30s, studied economics in London, fought with the Republicans in the Spanish Civil War, moved to New York, and returned to wartime France to lead refugees fleeing the Nazis over the Pyrenees, from Marseilles to Barcelona. As a historian, biographer Adelman was less attuned to Hirschman’s subsequent career as an economic theorist – of development, democracy, capitalism, and commitment. Alacevich has provided a perfect complement, a study of the works and life of the author of the classic, Exit, Voice, and Loyalty.
David Warsh, a veteran columnist and an economic historian, is proprietor of Somerville-based economicprincipals.com, where this piece first ran.