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The Wisdom of Finance summary
Mihir A. Desai
How the Humanities Can Illuminate and Improve Finance
24 mins
Brief summary
The Wisdom of Finance by Mihir A. Desai is a compelling exploration of the intersection between finance and the humanities. It shows how this intersection can improve our understanding, both of finance and of the world around us.
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The Wisdom of Finance
Summary of 8 key ideas
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Key idea 1 of 8
Finance isn’t just for investment bankers; it’s for all of us.
Consider this familiar scene, set inside the glass and steel of a Wall Street skyscraper. At the center of a stylish and sleek open-plan office, with necktie askew and feet on the desk, is the infamous day-trader.
For many of us, it’s a picture of unlimited greed. We remember the 2008 crash. We see the leering figure of Gordon Gekko in the film Wall Street.
But the truth is that many good, intelligent people spend their lives working in finance. Are they all engaged in a purely base, amoral business? Well, no, they’re not. Like any complex human endeavor, finance has a great deal to teach us, if we look at it the right way.
The key message here is: Finance isn’t just for investment bankers; it’s for all of us.
One major obstacle in coming to grips with finance is the traditional “Wall Street/Main Street” divide. On one side, Wall Street doesn’t help. The language of finance is often inscrutable. For instance, what’s the difference between “leverage” and “borrowing”? What exactly is “equity”? What do “options” mean? And further, Wall Street has behaved badly, from the excesses of the 1980s all the way to the 2008 crash.
On the “Main Street” side, the widespread belief that the entire financial profession is greedy and amoral only strengthens the divide. This perspective in turn damages the way in which people working in finance see themselves. And it means that the valuable lessons contained within the realm of finance are lost to most people.
So how can we bridge this gap? We need to link finance to our broader human and intellectual endeavors. The book Confusion de Confusiones, by the seventeenth-century merchant Joseph de la Vega, provides an excellent example.
In this depiction of the markets of Amsterdam, Vega portrays a conversation among a philosopher, a merchant, and a shareholder. When the philosopher admits to knowing little about markets, the shareholder rebukes him. How could such a worldly man neglect this fascinating topic? He describes finance as “a quintessence of academic learning and a paragon for fraudulence . . . a treasury of usefulness and a source of disaster.” In other words, finance is complex, full of both the bad and the good.
In the following blinks, we’ll consider what wisdom may be gleaned from this old and sophisticated business.
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What is The Wisdom of Finance about?
The Wisdom of Finance (2017) demonstrates that the world of finance has much to teach us, despite its reputation for avarice and irresponsibility. And likewise, there is much that finance can learn from our wider human endeavors, like literature, art, and philosophy.
The Wisdom of Finance Review
The Wisdom of Finance (2017) is a book that offers a fresh perspective on financial concepts and their real-life applications, making it a worthwhile read for both finance enthusiasts and those seeking financial wisdom. Here's why this book stands out:
- Through compelling stories and historical examples, the author brings finance to life, making it relatable and captivating.
- The book takes a holistic approach by exploring the intersection of finance with philosophy, psychology, and literature, providing a broader understanding of the subject.
- With its accessible language and clear explanations, the book ensures that complex financial concepts are easily understood, keeping readers engaged throughout.
Best quote from The Wisdom of Finance
Luck is a dominant and underappreciated part of life and performance.
—Mihir A. Desai
Who should read The Wisdom of Finance?
- Investors, bankers and insurance professionals
- Those looking for moral goodness in finance
- Anyone interested in the link between literature and money
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The Wisdom of Finance FAQs
What is the main message of The Wisdom of Finance?
The main message of The Wisdom of Finance is that finance is about life, and life is about finance.
How long does it take to read The Wisdom of Finance?
The estimated reading time for The Wisdom of Finance is several hours. The Blinkist summary can be read in just 15 minutes.
Is The Wisdom of Finance a good book? Is it worth reading?
The Wisdom of Finance is worth reading because it provides valuable insights and practical wisdom about finance and its relationship to life.
Who is the author of The Wisdom of Finance?
The author of The Wisdom of Finance is Mihir A. Desai.
What to read after The Wisdom of Finance?
If you're wondering what to read next after The Wisdom of Finance, here are some recommendations we suggest:
- Finance for the People by Paco de Leon
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- Real Life Money by Clare Seal
- Clever Girl Finance by Bola Sokunbi
- Investing With Impact by Jeremy K. Balkin
- How to Win Friends & Influence People by Dale Carnegie
- Other People’s Money by John Kay
- How Not to Age by Michael Greger
- Principles For Dealing With the Changing World Order by Ray Dalio
- Getting Good with Money by Jessi Fearon