Four Books that Explain Why We’re All Broke

Timothy Geithner's Stress Test

We sift through so much information every day, but how much of it is actually informative? On some topics, you have to supplement the click-bait by sitting down with a book. While economics isn’t as heartwarming as kitten videos, it covers areas that are definitely worth getting riled up about. Inequality between classes is on the rise, and many of us have important questions that need answering (What exactly was Occupy Wall Street about anyway? Why don’t I get paid more?!). Here are 4 entertaining, reader-friendly books to get you caught up on everything from the economic crisis to Wall Street and beyond.

Stress Test, By Timothy Geithner
Former Treasury Secretary Geithner’s humble memoir gives a subjective view of the unraveling of the U.S. economy in 2008. Geithner explains why he and his colleagues “bailed out” many of Wall Street’s bankrupt institutions and made other unpopular decisions during the financial crisis. If you’re looking for an intro to what the heck happened in 2008, this is a great jumping-off point.

Flash Boys, Michael Lewis
So maybe memoirs aren’t your thing. No problem, Lewis is a pro at telling the Wall Street tale in a narrative voice. Flash Boys follows a group of guys on Wall Street who realize that high frequency trading is a rigged game. What’s high frequency trading you say? Glad you asked. It’s a series of calculations, or algorithms, used to buy and sell stock very quickly—sometimes only capturing a fraction of a cent in profit. It’s high-risk, high-reward trading that can also cause a lot of volatility in the markets. Through the eyes of a few ethically conscious Wall Street rebels, Lewis captures a detailed view of the often obscure ways the Wall Street machine generates money.

Capital in the Twenty-First Century, Thomas Picketty
Who knew economics could be cool? French economist Picketty has made it so. Upon its March release, this book flew off the shelves so quickly Harvard University Press had to do a second and third printing. With a title that nods to the famous Marxist text Das Kapital, Picketty’s new book legitimizes concerns about the concentration of wealth in a few hands. Capital explores rising economic inequality between classes and makes recommendations for how to address it. It was written for the laymen and has been lauded by the likes of the New York Times‘ Paul Krugman and the New Yorker’s John Cassidy. This could be one of the most important books of the decade, and though long, it’s definitely worth your attention.

Think Like a Freak, Stephen J. Dubner and Steven D. Levitt
Levitt and Dubner have been tackling economics in a fun way since they released Freakonomics in 2005. The book uses statistical analysis to answer questions about modern life, like if drug dealers make so much money why do they still live with their mothers? The book led to a second book and a podcast. Think Like a Freak is the third installment in the Freakonomics series. Instead of solving life’s unsolved mysteries, it’s a guide for thinking creatively, rationally. If you’re looking for a book that will help you be more economically minded, this is the one for you.

What’s your favorite book on economics?

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