The Poker Face of Wall Street is about how to gamble and win. Gambling lies at the heart of economic ideas and institutions, no matter how uncomfortable many people in the financial industry are with that idea. Not surprisingly, the game most like the financial markets—poker—is hugely popular with financial professionals.
Introductions:
One would tend to think that gambling is a sterile activity that is meant to occupy those who have not much else to do and others when they have not much else to do. You would also think that there is a distinction between “economic risk taking” and “gambling,” one of them invested with respectability, the other treated as a vice and a product of a parasitic activity.
This book shows that the distinction between what is called purely gambling and “productive economic activity” is one of those socially constructed ones that remain sticky in our minds. While many may disagree with the point (our economics culture is vitiated by these mental boundaries between activities), it remains that gambling injects currency into economic life in the form of the expectation of future cash transfers and that, and not just narrowly defined “productive” activities, may make the world advance.
We may not accept it because economics is a narrative discipline and this appears to be the wrong narrative. It is not that gambling imitates economic life, but that economic life is largely modeled after gambling. That was the idea of the original thinker John Law, made infamous with his bankruptcy; Aaron Brown, another original thinker, revives it and takes it further.
Poker has valuable lessons for winning in the markets, and markets have equally valuable lessons for winning at poker. This book will give you insight into both kinds of gambling. We’ll begin with basic information about poker and finance, then delve into the psychology of finance and the economics of poker. We’ll review elementary and advanced tactics for winning. Along the way, we’ll see how America’s passion for gambling at poker and in the markets has shaped the country’s economic success and national character, and spilled over to make the globalized world we live in today. I’ve stuck bits of my autobiography in the Flashback sections to make the points personal. Finally, we’ll look at some of the cutting-edge work being done in these fields and some of the dangerous nonsense to avoid.
Contents:
- The Art of Uncalculated Risk
- Poker Basics
- Finance Basics
- A Brief History of Risk Denial
- Pokernomics
- Son of a Soft Money Bank
- The Once-Bold Mates of Morgan
- The Games People Play
- Who Got Game
- Utility Belt