Warm days on the central California coast, with Labor Day holiday visitors swarming into the little beach communities close by. I've been in the water, doing some bodysurfing yesterday, and noted how warm the Pacific is here right now, as warm as it will get this year. The heat of the day makes me feel as if I'm wilting. Perhaps I am. I need to drink more water. I can feel trickles leaking out of my body here and there in the form of perspiration, little rivers flowing from the interior sources. I look about in the front yard and take pity on a few of the thirstiest looking plants and give them a drink.

I have just finished reading Lords of Finance, by Liaquat Ahamed, a 500-page description of the four men who helped bring on the Great Depression of the 1920s and 30s. I learned much about international finance, but certainly not enough to have developed any strong opinions about our modern condition. (I probably know more about beverage lay-outs than I do about leveraged buy-outs.)

The four men who are the prime focus of this book were bankers for the central banks of England, Germany, France, and the United States. They spent a decade or more working with one another, sometimes in agreement, and sometimes miles apart in how they thought the world of money might best work. Insisting on war reparations from Germany after the close of World War I, was a point of contention that nobody could ever brush aside, as it had to do with national pride and unwillingness to negotiate a healthy way out of the dilemma for Germany.

The other obstacle for these power-hungry men was a loyalty to the gold standard that they would not give up--this idea that the value of a nation's currency must be tied to how much gold they had stashed away in vaults in a building in New York. Finally, in one simple sentence in the middle of the book, Ahamed states that when times are prosperous and running on an even keel is when greed moves in and upsets the equanimity. When financial times are unpredictable or slightly unstable, the greedy are less likely to go out on a limb with wild, highly-leveraged investment schemes that will later bring down other markets.

The book is more about biography and history than it is about economic theory, which is what I had expected to read, and it was an enjoyable ride to follow the careers of these four men who bumbled their way through the times, causing much trouble for the rest of the world that is yet to be forgotten. A few parallels with our modern circumstances are made, but for the most part, the worst mistakes these four men made have taught our modern money masters some lessons that should now be easy to avoid.

I try to go out of my boundary ever-so-often and read a book or two about a subject of which I know nothing about, hoping that I will find the material interesting enough to hold my attention. I would say that this book does that for me. One other point that struck me was that Ahamed is very careful to demonstrate or illustrate, rather than preach. I read very little of any prescription, which allowed me to sort through the facts on my own, and pull together my own instincts and perceptions. I love a book that will allow me to do this!