Not So Crazy

Someone sent me a book with a provocative title, "Crazyman's Economics," by T.E. Scott as told to Stephen Edds. A photo of the former, in overalls, is on the cover. Not a typical investment book, to be sure.

Having read through it -- not always agreeing, mind you -- I have to say that it is not crazy at all, but actually applies good, solid horse sense to the financial markets.

The basic premise of the book, as in Wall Street Versus America (which is liberally cited in publicity for this book, but not the book itself), is that Wall Street is a loser's game in which what are described here as the "Masters" have an edge. That point is illustrated with a liberal use of charts and illustrations.

I don't agree with what is recommended in this book (elimination of margin and limitation on trading) but I guess my main beef is that it lacks much of a "next step" for investors. Since buying individual stocks (and of course, commodity contracts) is a bad idea, what does one do with one's money?

It's a mistake to just avoid the stock market, and in fact this may well be a good time to invest. The solution I described in WSVA, index funds and index products, is the answer I think and I'd like to have seen that addressed in this book.

© 2008 Gary Weiss. All rights reserved.