Our Recommended Summer Reading List (Part I)

Memorial Day is here, and that means summer is upon us. I" 'm a big fan of recommended book lists - I collect them! - and, for the first time in my life, I took a stab compiling a list of ten books I've read this year that I really liked. Hopefully, you will find them as entertaining and enlightening as I did when lounging on the beach. I hope to have a second list of recommended books later this summer, too. 

The Chile Project: The Story of the Chicago Boys and the Downfall of Neoliberalism by Sebastian Edwards (Princeton Press, 2024, 376 pages)

In 1955, the U.S. State Department launched the "Chile Project" - an effort to train and assist Chilean economists at the University of Chicago to help embed free market policies in the country. A steady flow of Chile's best and brightest matriculated through the University's graduate program, studying under some of the most brilliant economists in the World, including Milton Friedman. By the time General Augusto Pinochet overthrew the Neo-Marxist regime of President Salvador Allende in 1973, this cadre of free market economists was in a position to move sweeping reforms of privatization and deregulation. This is a fascinating history of what happened, the impact it had not only on Chile but the whole region, and how Chileans ultimately rebelled in 2019 against neoliberalism and elected Gabriel Boric president, a socialist dedicated to ending "neoliberalism." We would note, however, that Boric has struggled badly to implement his promised changes, including two failed efforts to rewrite the constitution.

US - Taiwan Relations: Will China’s Challenge Lead to Crisis? By Ryan Hass, Bonnie Glaser, and Richard Bush (Brookings Institution Press, 2023, 184 pages)

Over the last two years, markets have been concerned about a possible invasion of Taiwan, how the U.S. would respond, and what it would mean for the global economy. However, in our conversations with numerous market participants, many do not understand the dynamics of the US-Taiwan relationship, the history of China-Taiwan relations, and other important dynamics. Hass, Glaser, and Bush have published an excellent and much-needed examination of all these critical questions. To understand what is happening and what might happen, you must read this well-written and indispensable book.

We Win, They Lose: Republican Foreign Policy & the New Cold War by Matthew Koenig and Dan Negra (Republic Book Publishers, 2024, 220 pages)

Matthew Koenig's and Dan Negraea's book is getting wide circulation as something from a Republican foreign policy historical manifesto. The title comes from Ronald Reagan, who was asked in 1977 what the driving principle of his foreign policy was. His response: "My idea of American policy toward the Soviet Union is simple, and some would say simplistic. It is this: We win, and they lose." The authors, both admirers of Reagan and veterans of the Trump Administration, push back on the strain of isolationism currently running through the Republican Party. And it is having an effect as countless Republican operatives and strategists we've spoken to have recommended the book to me - and I'm glad they did, as it gave me an excellent inside view of where Republican foreign policy will likely go in the years to come.

Breaking the Mold: India’s Untraveled Path to Prosperity by Raghuram G. Rajan (and Rohit Samba ( Princeton University Press, 2024, 336 pages)

Former Reserve Bank of India Governor Raghuram Rajan and Penn State Professor Rohit Lamba write a fascinating and taunt guide to understanding what India has accomplished economically and what it still needs to do going forward. India's economy has overtaken the United Kingdom's to become the fifth-largest in the World. However, it is still only one-fifth the size of China, and India's economic growth needs to be faster to provide jobs for millions of its ambitious youth. Blocking India's current path is intense global competition in low-skilled manufacturing, increasing protectionism and automation, and the country's majoritarian streak in politics. Rajan and Lamba outline what needs to be done to overcome these challenges. 

The Dillon Era: Douglas Dillon in the Eisenhower, Kennedy, and Johnson Administrations by Richard Aldous (McGill - Queens University Press, 2023, 296 pages)

Having grown up in Washington, I was taught by my grandfather (who was a mega-lobbyist who knew presidents and the most influential members of Congress while having a brother who was the FBI Deputy Director under J. Edgar Hoover) that history is more often quietly made by the extraordinary men and women serving the President than the President themselves. Douglas Dillon was one of those men - who is sadly fading away with the sands of history. The scion of a fabulously wealthy family that founded the then-Wall Street powerhouse investment bank Dillon Reed, he never forgot the real roots of his family - his grandfather had been a poor Polish Jew who emigrated to the U.S., settled in Texas, changed his name to "Dylion" which was his mother's name and from which it was anglicized to Dillon. This thin biography does a fantastic job recounting Douglas Dillon, who served as Treasury Secretary, savvy advisor to Presidents, Ambassador to France (back when that meant something and was not just an honorific), and Wall Street titan himself. 

Unexpected Revolutionaries: How Central Banks Made and Unmade Economic Orthodoxy by Manuela Moschella (Cornell University Press, 2024, 188 pages)

I stumbled upon this slim little book in a bookstore, and once I started reading it, I could not put it down. A fascinating read looking at how central banks - specifically the Federal Reserve, the European Central Bank, and the Bank of Japan - have massively transformed from the staid and predictable institutions of the last century due to the shocks of the 2008 global financial crisis and COVID. 

In short, the playbooks central banks had worked from for decades had to be tossed, and new ways of dealing with economic shocks developed. The history the author covers is well-written and fascinating, but what was particularly engaging was how it has led to central banks stretching into areas far beyond monetary policy, such as climate change and inequality. The "neoliberal macroeconomic regime," as we have known it, is gone, and a new age of central banking is upon us in ways we are only just beginning to understand. 

Ian Fleming: The Complete Man by Nicholas Shakespeare (Harper Publishing, 2024, 864 pages)

Since he first wrote "Casino Royale" in 1953, Ian Fleming's James Bond has tightly gripped the imaginations of readers and moviegoers worldwide. It also helped Great Britain, struggling to get back on its feet after World War II, when the Empire began crumbling and colonial states broke away. Indeed, Fleming's Bond recovered a sense of Britain's strength, swagger, and pride so powerfully that James Bond has become enshrined as an actual emblem of "Great" Britain itself (Recall in 2012, then-Bond actor Daniel Craig - playing Bond one last time - joined forces with Queen Elizabeth in Buckingham Palace to go forth together in a grand video production to officially open the 2012 Olympics in London). But who was Ian Fleming? In this superb biography, Nick Shakespeare shows that Fleming was almost as mysterious and adventuresome as his James Bond.  He sought to "live a complete life," which led him to travel the World constantly, have an incredible career in British Naval Intelligence, participates in some of the most significant, most important moments of his time, and know everyone of power and wealth in the World.  It was a fantastic life - one defined by his Bond novels, of which he only spent the final twelve years writing. 

The Achilles Trap: Saddam Hussein, the United States, and the Middle East 1989 - 2003 by Steve Coll (Penguin Press, 2024, 556 pages)

We are now entering, rightly, the phase where historians and policymakers can begin to look back and examine the Iraq War. Why did we go in? Why was the intelligence so off? And, as Steve Coll does brilliantly in this new book, why did Saddam Hussein risk (and ultimately lose) everything by giving the false impression he had hidden stocks of weapons of mass destruction? Coll goes deep, looking at not just the U.S. side but the Iraqi side, the Iraqi generals, scientists, and other people of power who sat by and played into this tragic facade that ended up destroying Hussein's long reign of power, plunging the country into war, and forever changing the future of Iraq.

The Peacemaker: Ronald Reagan, The Cold War, and the World on the Brink by William Inboden (Dutton Press, 2022, 608 pages)

Having served in the Reagan White House, I love to read good, well-researched books on what was actually going on while I was there (I started there when I was 22 years old and left when I was 25). Inboden writes an excellent history of how Reagan and his team successfully ended the Cold War and helped expand democracy and free trade globally. But it was Reagan's determination and focus on defeating the Soviet Union - the Evil Empire - that made it all happen. This is a great read. 

Countering China’s Great Game: A Strategy for American Dominance by Michael Sobolik (Naval Institute Press, 2024, 218 pages)

Chinese President Xi Jinping's "project of the century" - the Belt & Road Initiative - is one of the most significant geopolitical gambits in recent memory, leveraging China's investments for political, economic, and military purposes around the World. Reaching around the World - from Asia to Africa to Latin America - China firmly set its grand strategy. So far, the U.S. and other Western and Asian democracies have not put up a comprehensive counter-strategy. Sobolik explains the Belt and Road efforts and offers an intelligent blueprint for the United States to counter it by playing off the one core weakness China has exposed to their plan: imperial overreach. 

Recommended Weekend Reads

February 3-5, 2023

We thought you might find the following useful reading.  Let us know what you think and if you or a colleague want to be added to our distribution list.  Have a great weekend.

·       “More Cite Government as Top US Problem; Inflation Ranks Second” Gallup

In Gallup’s latest poll, more Americans name the government as the nation’s problem. The government ranks as the top problem for both Republicans and Republican-leaning independents (24%) and Democrats and Democratic-leaning independents (18%).

·       “Putin’s Oil Makes a Stop Off Spain en Route to China”  Bloomberg Opinion

Sanctions are making it riskier and pricier for the Kremlin’s crude to get to Asia, but the EU is still a transit hub. via the town of Ceuta – a tiny Spanish enclave that sticks out of Morocco into the Mediterranean Sea like a thumb. Ceuta is just in the right place: inside the Mediterranean Sea, it’s sheltered from the stormy winds and winter swell of the North Atlantic. 

Source: Bloomberg

·        “What are Large Banks Doing About Climate Change?” The US Federal Reserve Board International Finance Discussion Papers

This new paper by Federal Reserve staff looks at 30 of the biggest banks in the world and their commitments so far to finance green projects.  So far, they have collectively put in $1.2 trillion a year, which will bring them $33.6 trillion by 2050.  But, the paper argues, that will only be approximately 25 percent of what is needed to reach net zero emission goals.

Chart of the Week

Hey Buddy, Looking for Some Eggs?:  We have been hearing a lot lately about the soaring price of eggs, spiking more than 60 percent in recent months (happily, I live on a farm, and our chickens have been quite productive).  The reason for the price surge?  Avian flu outbreaks have decimated chickens across the US.  As a result, egg smuggling from Mexico is becoming a big business.  Bloomberg examined the situation and learned seizures of smuggled eggs have surged more than 300 percent, with many of the seizures being only a few 30 egg flats.  Here is their chart showing what the hottest new smuggling business in America looks like and where eggactly (sorry – couldn’t help myself) it is happening the most:

A Good Read… 

In the Nation’s Service: The Life and Times of George P. Shulz 

George Schultz was a remarkable American by any standard.  In his new, highly illuminating biography of Schulz, former New York Times reporter Philip Taubman reminds us of the extraordinary life Schulz lived and the critical role he played in transforming the country and the world.

Schulz’s resume was long and distinguished (an understatement if there ever was one).  The son of a New York Stock Exchange executive, Schulz was a Marine Corps officer in the Pacific theater during World War II.  When he returned home, he earned Ph.D. in industrial economics at MIT (studying under Robert Samuelson) and then taught at MIT.  He then stepped into public service in  1955 to serve at the Council of Economic Advisors under President Dwight Eisenhower.   

He then went on to become a professor and then dean of the Booth School of Business at the University of Chicago.  He returned to Washington in 1969 to become Secretary of Labor under President Richard Nixon, then Director of the newly created Office of Management and Budget, and then Secretary of Treasury. Leaving public service, he joined the Bechtel Group, where he became its President and a member of its board of directors.  He then returned to public service in 1982 when President Ronald Reagan asked him to serve as Secretary of State. 

What Taubman sheds considerable light on is Schulz’s considerable efforts – and success – at integrating public schools in the South.  Historians tend to focus on Schulz’s herculean efforts under Reagan to bring down the Iron Curtain and skip over Schulz’s championing of civil rights.  He also made considerable inroads with Big Labor, building a strong working relationship with the legendary AFL-CIO President George Meany.   

On a personal note, when I was a very young staffer in the Reagan White House, Schultz was seen as legendary even then within the Administration.  I would occasionally see him in the hallways, and, despite the tremendous sense of gravitas that naturally swirled around him as he headed into a National Security Council meeting or over to the Oval Office, he always had a smile and a hello for us juniors.  That was a really big deal for us.

This is a well-deserved and well-written biography and a great read for anyone with an interest in economics, foreign policy, civil rights, and the history of the last 70 years.  It is also a commentary on how the “best and the brightest” like Schulz are rarely seen in Washington anymore.  Hopefully, this book will inspire more men and women of Schulz’s caliber to serve.

12 Books for Christmas

Reading and collecting books has been a life-long passion for me. At this point, my house is now crammed with more than 3,000 books. Many of them are first editions or author-signed, sitting on the shelves of a large, beautiful library my wonderful wife designed when we built our home.

I came to books as a teenager as a means of escape. I was a terrible student who struggled through high school and college but somehow found the solitude of reading books a relief, a peaceful place to go for adventure, fun, and peace. In all the years I’ve spent talking to clients around the world, I’m frequently asked what books I’m reading these days (is there any way to make a new friend faster than talking books with someone?).  

With this in mind and knowing many of you are struggling to find good Christmas gifts for friends and loved ones - I am sharing twelve books I found particularly good in 2022. I hope you find a few of them as good as I did:

The Sassoons: The Great Global Merchants and the Making of an Empire by Joseph Sasson

A fascinating history of the Jewish-Bagdadi Sassoon family who, amid the Ottoman Empire, built a global empire trading cotton and opium while running a massive worldwide shipping and banking empire. They became leaders in British politics and the arts.

“The Anarchy: The East India Company, Corporate Violence, and the Pillage of an Empire” by William Dalrymple

The East India Company was a massive endeavor that forever changed the size and reach of the British Empire. But what exactly did the Company do, and how did it get so large? Dalrymple wrote a fantastic history of the first joint-stock company in history, one so big and bloated that it almost bankrupted Great Britain - more than once. It was immeasurably violent and corrupt and made some in England stupendously wealthy while taking greater India for all it was worth. You won’t be able to put this one down.

“Master of the Game: Henry Kissinger and the Art of Middle East Diplomacy” by Martin Indyk

The Middle East has always perplexed and frustrated the US. It has been 20 years since the US last brokered a peace agreement between Israel and Palestinians, which did not last. How did it all begin? Indyk, who was “present at the creation” and has done extraordinary research for this book, explains all. He is a gifted writer who gives the reader a seat at the table, explaining Kissinger’s talents and weaknesses as he pulled every trick out of his magic bag seeking peace in the region. If you want to understand what is happening in the Middle East now, you must read this book.

“Inside Money: Brown Brothers Harriman and the American Way of Power” by Zachary Karabell

Having worked on Wall Street for nearly 30 years, I've always been fascinated by the history of the most significant firms. For the last 200 years, Brown Brothers Harriman has stood out as one of the US's most potent and impactful investment banks. Karabell writes an incisive history of the old firm and how its partnership culture steered it successfully through tough times and away from scandals - often at the cost of a lot of money in fees. Brown Brothers are not what it once was in terms of power, but because of its ethos of prudence and serving the client, it remains arguably the most pristine of financial firms in the US today.

“America in the World: A History of U.S. Diplomacy and Foreign Policy” by Robert Zoellick

Bob Zoellick is one of the US' most distinguished diplomats. He played a critical role in negotiating the unification of Germany a later helped hammer out an extraordinary coalition of nations that jointly liberated Kuwait following Saddam Hussein's invasion and occupation. Bob has now written a great history of American diplomacy, beginning with Alexander Hamilton and Benjamin Franklin up to the current day. He identifies five traditions that have emerged from America's encounters with the world: the importance of North America; the unique roles trading, transnational, and technological relations play in defining ties with others; changing attitudes toward alliances and ways of ordering connections among states; the need for public support, especially through Congress; and the belief that American policy should serve a larger purpose. This is a great book chock full of fantastic (and little-known) facts and stories illuminating the story of the United States in the world.

A Pipeline Runs Through It: The Story of Oil From Ancient Times to the First World War by Ken Fisher

We think of petroleum as a relatively new invention, but the truth is has been used since the age of the Neanderthals. Fisher takes an in-depth history of the use of oil over the generations, detailing how the fight for its control changed the world long before we became dependent on it for travel, heating, and all the other modern uses for it today.

The Peacemaker: Ronald Reagan, the Cold War, and the World on the Brink by William Inboden

The peaceful end of the Cold War seems to be fading from history these days, especially as we see another form of Russian totalitarianism wreaking havoc in Ukraine now. But Inboden takes us back to the days when the Soviet Union seemed strong and virtually invincible - and how Ronald Reagan turned it all on its head, determined to throw Soviet Communism “on the ash heap of history.” As an old Reagan White House staffer who was around when the Berlin Wall fell and the Iron Curtain imploded, this was a marvelous and inspiring read of what one man could do to change the world for the better.

Not One Inch: America, Russia, and the Making of Post-Cold War Stalemate by M.E. Sarotte

It was then-Secretary of State James Baker who proposed to Soviet leader Mikhail Gorbachev a bargain following the fall of the Berlin Wall: If you let Germany go, we will not move NATO one inch eastward. That, of course, did not hold and, in many ways, helped contribute to Russia’s grotesque invasion of Ukraine today.

The End of the World is Just Beginning: Mapping the Collapse of Globalization by Peter Zeihan

Zeihan, who previously authored the best-selling “The Accidental Superpower” in 2014, argues we have been living in an artificial world where the rules of geography, demographics, and the US’s eroding commitment to free trade - among several other factors - are leading the world (but not the US) to a disaster-in-waiting. It is not a cheery book, but Zeihan has done a lot of excellent research and presents some chilling scenarios we all must consider in the coming years.

Unchecked: The Untold Story Behind Congress’ Botched Impeachments of Donald Trump by Rachel Bade and Karoun Demirjian

Love him or hate him, the Trump years in Washington were intense and often bewildering. One aspect of those years which left me particularly shocked and asking a lot of questions was how Congress could bring impeachment proceedings against President Trump twice and fail to convict him. In their book, Bade and Demirjian (both Politico reporters) detail in gruesome detail the political hackery and incompetence on both sides of the aisle. A depressing but deeply researched and sourced book.

The Economic Weapon: The Rise of Sanctions as a Tool of Modern War by Nicholas Mulder

This one is a bit wonky and academic but still very worthy of reading, especially in today’s geopolitical realm, where sanctions seem to be applied everywhere. Mulder takes us back to World War I, where we see how blockades were put into effect - and the innumerable times since then sanctions have been used and their economic impact and effectiveness (or lack thereof).

China After Mao: The Rise of a Superpower by Frank Dikökker

Dikötter is an extraordinary historian of modern China, a scholar and professor in Hong Kong who has written about the Communist Revolution and the development of the Chinese Communist Party. In his latest book, he details how China rose from the disaster of the Cultural Revolution to become an economic and political powerhouse - along the way laying traps for itself, which the current leadership is struggling to deal with.

* * * * * * *

Bonus Round: These books I’ve just recommended are - for the most part - a bit heavy academic reads. But I do love a good novel - especially those dealing with the interwar years in Europe. No one does that better than Alan Furst. He has written twelve stories set in Eastern Europe, Russia, Turkey, Berlin, and Paris. Characters from one book occasionally appear in later books, adding a twist of memories and experiences to the tale you are reading. Love, war, espionage - Furst somehow captures the interwar years' emotions and events, placing you there as a witness. I hope he writes more.

Merry Christmas and Happy New Year!

Read Around the World in a Weekend: March 25, 2022

Please find our recommended weekend reads covering key issues and events around the world.  We hope you find these informative, useful, and perhaps even fun.  Please let us know if you want us to add anyone to our mailing list.

Russia/Ukraine/Belarus

•  OMFIF “Russia sanctions, the renminbi, and the dollars future – The red herring returns”

  The author, a former senior US Treasury official, argues that with the imposition of severe financial sanctions on Russia, rumblings that China will provide Russia a lifeline, and rumors Saudi Arabia will denominate oil prices in renminbi, markets are once again abuzz about the dollar’s future global financing role. The red herring is back!

• Rand Corporation “Russia’s Problems with Military Professionalization”

  The internet is littered with reports of Russian soldiers seemingly stalled in convoys, deserting their units, and being unable to maintain their equipment. An effort to collect and confirm the instances of Russia's abandoned, destroyed, and captured military systems had to be terminated due to the inability of its contributors to keep up with the pace at which it is happening. While the internet is not reality, some may wonder if this is really the same Russian military that has been feared around the world for decades?

• Rand Corporation “Russian Grand Strategy: Rhetoric and Reality”

  First published in September 2021 (and included in an earlier Read Around the World), we thought it worthwhile to reconsider this large review and assessment of Russia’s – and Putin’s – Grand Strategy going forward.

•  Chatham House’s Belarus Initiative “Poll of Belarusians’ Views on the military conflict between Russia and Ukraine”

  The poll, conducted between March 5-14, showed only three percent of the urban population support Belarusian troops being involved in the war on Ukraine. And a majority of them do not support Russian troops being based in Belarus as well expecting the war will have “serious socio-economic consequences” on their way of life.

United States

•  Defense One “State of Defense”

  The daily defense publication takes an in-depth look at the state of the US Defense posture, branch by branch, in the face of growing security risks around the world.

•  Foreign Policy “US Grand Strategy After Ukraine”

  Seven leading foreign policy strategists weigh in on how the war will shift US foreign policy in the short, medium, and long term.

•  AmCham EU “The Transatlantic Economy 2022”

  The Transatlantic Economy 2022 presents the most up-to-date facts and figures about the economic relationship. The study includes dedicated profiles for 30+ European countries and all US states. This year’s study features new insights into how the war in Ukraine affects the transatlantic relationship, the impact of the COVID-19 pandemic, prospects for the recovery, global supply chain issues, relations with China and the transatlantic energy economy.

• University of Virginia Center for Politics “Are Latinos Deserting the Democratic Party? Evidence from the Exit Polls”

  One key question in American politics is the trajectory of Latino voters. Donald Trump performed better in 2020 with Latino voters than he did in 2016, particularly in places like South Texas and South Florida.  However, an analysis of the longer-term trend in Latino presidential voting shows that this growing voting bloc is not necessarily trending one way or the other. Presidential incumbency appears to have a stronger influence on Latino voters than on other demographic groups.

Africa

• Institute for Security Studies (South Africa) “Africa holds the answers to Europe’s wartime energy crisis”

  Europe needs to swap its dependence on fossil energy from Russia with renewables from Africa. For example, Theoretically, the Sahara could supply four times the world’s current energy demand. Even a fraction of that could replace the energy from Russian gas imports. Solar can also ramp up rapidly, perhaps beating the plans to build more liquefied natural gas terminals.

Latin America

•   Wilson Center “China’s Investments and Land Use in Latin America”

  The report argues that in order to understand the environmental impacts of China’s trade and investment in Latin America requires nuance. It focuses on multiple factors behind the environmental degradation associated with the soy, copper, beef, and pork industries: the nature of the resource, local legal frameworks, and global industry standards. The report highlights cases in which poor decision-making by both Chinese companies and Latin American countries is driving resource extraction to a tipping point.

Middle East

• Carnegie Middle East Center “Only Going to Get Worse”

  In this YouTube interview, the chief of water, sanitation and hygiene (WASH) at the United Nations Children’s Fund (UNICEF) discusses the growing challenge of the water scarcity situation in the Middle East and Africa.

Book Recommendation of the Week:

The Anarchy: The East India Company, Corporate Violence, And the Pillage of an Empire

(by William Dalrymple, Bloomsbury Press 2019, 552 pages)

Imagine a giant private equity firm that operates with complete impunity, no government regulation or oversight, no bounds on their greed. They take over a large swath of a foreign country and begin to mint money, figuratively and literally. And they also have their own army, which they deploy to subdue the locals whenever they complain too much.

Welcome to the East India Company, which we learn all about in the superb  “The Anarchy: The East India Company, Corporate Violence, and the Pillage of An Empire,” written by William Dalrymple.

A corporate history that grabs you and gives you a vivid, and at many points, horrifying portrait of arguably the most powerful companies in history.

What makes Dalrymple’s book particularly interesting – and differentiates it from numerous other histories of the East India Company – is his deep and thorough research of Indian source material. He gives a fresh, holistic account of the Company not just from the Western perspective but also from the Indian perspective. And that is important because with it comes an illuminating portrait of the majesty and richness of the various Indian, Iranian, and Afghani dynasties that thrived – and died – during the Company’s operations. 

What I found rather stunning in Dalrymple’s history of the Company is something I suspect most readers will not expect: The Company was, by and large, a rather poorly run operation. There are numerous instances of near-collapse – once almost cratering the entire British economy and forcing the collapse of multiple leading British and Continental European banks (which Dalrymple cleverly compares to the 2008 financial crisis).  

But the money the Company  made in the good years. Oh, the money! Staggering sums even by today’s standards.  Many a poor or lower-middle-class English boy with a sense of adventure struck out to Bombay or Madras or some other balmy place in India where they Company operated, returning to London years later filthy rich (albeit, only if they survived the near constant warfare and deadly sicknesses).  The most prominent of all of them being Lord Clive. Richard Clive was born in 1725, one of thirteen children to a modestly successful lawyer. He proved to be a violent, nasty boy – even running a protection racket as a teenager. With these rough skills and dangerous disposition, he journeyed to India in 1744 as a simple clerk.

I do not want to ruin Dalrymple’s extraordinary and devastating portrayal of Clive in India, but I’ll tease you with this: when all was said and done, Clive ended up being the wealthiest man in all of Europe. He became Lord Clive, 1st Baron Clive, a man so rich that his wife’s pet ferret even had its own diamond-studded necklace. But money doesn’t buy happiness, and clearly, Clive never found it. He ended up killing himself in 1774 at his massive Berkley Square mansion at the age of 49 by stabbing himself in the throat with a penknife.

This is an important book to understand how Britain gained much of its long-term wealth that survives even today and how India – once a great empire itself – was devastated by the Company and still struggles with the repercussions. It is beautifully written with countless colorful stories of battles and palace intrigue, transporting the reader to the place and a time long ago.  It is indeed a great read.ke it stand out

Fulcrum Macro Advisors’ Read Around the World in a Weekend: March 18, 2022

Russia/Ukraine War

• The New Yorker “The Weakness of the Despot”

  New Yorker Editor David Remnick interviews Stephen Kotkin who is considered one of the greatest scholars on Stalin and Russian history. They discuss Putin, Stalin, and the West and why Putin decided to invade Ukraine.

• Foreign Affairs “The End of Globalization”

  Peterson Institute for International Economics President Adam Posen writes on what Russia’s War in Ukraine means for the world economy.

• Center for Strategic and International Studies “Cryptocurrency’s Role in the Russia-Ukraine Crisis”

  Since Russian forces invaded Ukraine on February 24, the United States and its partners have levied an unprecedented series of sanctions on Russia. These efforts have raised questions, including in Congress, about whether cryptocurrencies can be used by Russian actors to bypass sanctions. More broadly, the Russia-Ukraine crisis comes at a time when policymakers are trying to decide how to regulate digital assets. 

• Carnegie Endowment for International Peace “Moscow’s Southern Accent?”

  The Ukraine war will reshape Russia’s influence in the Middle East, the Mediterranean, and Africa where they have long been active politically, economically, and militarily.

• American Purpose “Preparing for Defeat”

  Scholar Francis Fukuyama writes that he believes Russia is “heading for outright defeat in Ukraine” and “the collapse of their position could be sudden and catastrophic” and the West needs to be ready.

• Center for European Policy Analysis “The Suwalki Corridor”

  The Suwalki Corridor, a 65-kilometer-wide strip of territory linking Poland with Lithuania, is NATO’s most vulnerable chokepoint along its eastern flank. In the event of a conflict between Russia and NATO, Russia’s military—operating from the Kaliningrad exclave and from Belarus—could attempt to close the Suwalki Corridor and incapacitate NATO as a security provider for its three Baltic members.

China 

• Foreign Affairs “Xi Jinping’s Faltering Foreign Policy”

  Chinese President Xi Jinping has a problem: His foreign policy plans are now at risk because of Russia’s invasion of Ukraine.  An expert explains.

United States

• Gallup Polls “Americans Still Pro-Israel, Though Palestinians Gain Support”

  Americans continue to express greater sympathy for the Israelis than the Palestinians in the Middle East conflict, as they have throughout Gallup's trend -- 55% now sympathize more with the Israelis and 26% with the Palestinians

Latin America

• Foreign Policy “Washington Must Respond to China’s Growing Military Presence in Latin America”

  Colombia’s designation as a major non-NATO ally comes at a critical moment as China continues to press its sphere of influence across the Southern Hemisphere.

• Center for Strategic and International Studies “Russian Invasion of Ukraine Force a Rethink about Russian Presence in the Americas”

  Given the global revulsion toward Russia’s unprovoked invasion of Ukraine, governments in Latin America and the Caribbean should rethink their relationship with Russia The brutality of this invasion should make Argentina and Brazil, two countries flirting with Putin, think twice about a deeper partnership with the Kremlin. The rest of the region should see Russia’s invasion as a wake-up call and reduce their ties in the coming weeks and months.

Africa

• “Mali Magic: The Digitized Manuscripts of Timbuktu Dating Back to the 16th Century”

  An amazing interactive experience: Mali Magic, a collaboration among Google Arts & Culture and a number of local and international organizations, allows users to read thousands of documents. Once, long ago, the city of Timbuktu was once an economic hub for trade on the continent and a center of learning. During a 10-month occupation in 2012, Timbuktu was taken over by rebel groups, where thousands of priceless ancient manuscripts came under threat and more than 4,000 were either burned or stolen by jihadis. Malian librarians and their assistants secretly transported hundreds of thousands of volumes into family homes in a bid to save them from destruction. Through those efforts, some 350,000 manuscripts from 45 libraries across the city have been kept safe. 

Terrorism

• Carnegie Endowment for International Peace “The Insurgency of ISIS in Syria”

  Since the “defeat” of ISIS in Syria in 2020, the Islamic State has morphed into a non-spatial insurgency capable of conquering territorial boundaries.  For ISIS, their rural insurgency and desert combat is no less important than urban warfare as a means of achieving its objectives and ensuring its resurrection which now has an estimated 24,000-30,000 recruits. 

Global Markets/Commodities

• IMF Blog “War-Fueled Surge in Food Prices to Hit Poorer Nations Hardest”

  Global food prices are poised to keep climbing even after jumping to a record in February, placing the heaviest burden on vulnerable populations while adding to headwinds for the global economic recovery. Food commodity prices rose 23.1 percent last year, the fastest pace in more than a decade, according to inflation-adjusted figures from the United Nations Food and Agriculture Organization. February’s reading was the highest since 1961 for the gauge tracking prices for meat, dairy, cereals, oils, and sugar. 

Book Recommendation of the Week:

The Twilight Struggle: What the Cold War Teaches Us About Great-Power Rivalry Today

(By Hal Brands, Yale Univeristy Press, January 2022, 318 pages)

The Cold War is a distant memory for many of us of a certain age and nothing more than a textbook history lesson for the rest of us under the age of 40.  But now, in the wake of Vladimir Putin’s brutal and bloody onslaught against Ukraine amid our collective prolonged worry and apprehension about an increasingly aggressive China, many seem to be struggling to understand what it will take to keep the peace.  History can and will guide us, so we go back to the history books for guidance and enlightenment.  

The first place we should start is with Hal Brand’s latest book.  Brands, a noted Cold War historian and former Pentagon advisor, presents an illuminating and richly researched lesson of how the US dealt with the challenge of the Cold War – that “Twilight Struggle” the West fought from the end of World War II until 1991 when the Soviet Union dissolved itself.  Brands gives us a crisp examination of the many successes, and more than a few missteps US leaders experienced during these anxious years.  Ultimately, it was the power of ideas and free markets brought the West victory against a hollowed-out Communist empire – but it took extraordinary work, innumerable policies and programs, and a willingness to stand strong that won the peace.  

Brands ventures deep into those many challenges, strategies, and tactics the Cold War American Presidents, beginning with Truman to ending with Reagan and Bush, took up to win that “Twilight Struggle.” To be fair to potential readers, this is not light reading.  But it is an excellent read for those fascinated by Cold War history.  For everyone else who picks up this book, it is something of an incredibly well-timed primer for what it will likely require from all of us to strenuously defend freedom and democracy as we know it once again.  

Book of the Week: “Master of the Game: Henry Kissinger and the ARt of Middle East Diplomacy”

With the countless books written about Henry Kissinger, it is hard to find anything new these days contributing in a substantive or even interesting new way to his legacy, the history he was a part of, and the history he made. But there is a sparkling new exception to this rule, Martin Indyk's "Master of the Game: Henry Kissinger and the Art of the Middle East." Richly detailed and written in a highly engaging and witty style, Indyk vividly illustrates how Kissinger dealt with the multiple Middle Eastern crises' launching the US' numerous efforts over the years to bring peace to the region. Moreover, he gives a foundational history to the US' concerted and oft-failed efforts to bring peace and stability to the region.

I came away from reading this book having learned more about Kissinger's thinking, strategies, and tactics in this Indyk's book than virtually every other Kissinger biography I have read (and I've read quite a few). Indyk does not write a dry hagiography of Kissinger but keeps it honest and human. We see how Kissinger somehow balanced the extreme tensions, egos, and demands of the multiple and very different Arab states versus a still young Israel fighting for its survival. All the great names of the age are there: Sadat, Meir, Hussain, Brezhnev, Nixon. And we see all sides of Kissinger: At times sly, other times brutally frank with both Arab and Israeli leaders, as well as the Kissinger who made mistakes and had to move hard and fast to correct himself and the policies he proposed.

If there is one criticism of the book, it is the sheer amount of detail that can be slightly overpowering at times. Indyk took extraordinary time and painstaking effort to get the overall historical account correct, as well as the innumerable small but critical conversations, meetings, and interactions.

But what helps bring a unique perspective to the book is Indyk's own experiences working for US-Palestinian peace efforts over the years. A former US Ambassador to Israel and a senior aide to then-President Obama, Indyk can compare and contrast what happened during Kissinger's time versus what Obama and Indyk encountered and attempted to achieve.

This is the book to read for those fascinated by the complexities of Middle Eastern politics and history and the United States' efforts to bring greater peace and stability to the region.

Wall Street’s Prudent Powerhouse

Wall Street both fascinates and repulses we Americans. The glowing power and the staggering flows of money, its ability to shape or destroy not only industry but entire countries. As a result – and depending on economic and social conditions – we have had a long episodic relationship with our financial titans, at times adulating them, at times seeing them as the fonts of all corruption and needing to be broken apart and controlled like dangerous animals.

We are vividly reminded of this odd and uneven relationship in Zachary Karabell’s richly absorbing and truly fascinating new book, “Inside Money: Brown Brothers Harriman and the American Way of Power . Using the long, storied history of Brown Brothers Harriman and its two antecedent firms, Brown Brothers and H.E. Harriman, we give both a grand and at times poignant tour of American finance and the massive role it has played in building our nation. Moreover, as a critical sub-theme of his book, we are shown that not all Wall Street investment houses of uncontrolled greed and fiscal imprudence. Case in point: Brown Brothers Harriman.

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Of the two firms, Brown Brothers is the oldest, tracing its history back to late 1700’s Ireland where we find Alexander Brown launching a successful business as a linen merchant. But Ireland was a troubled place then and, as a result of the Irish Rebellion of 1789, Brown was forced to flee the Emerald Island for Baltimore, Maryland with his wife and his youngest son (the three elder ones being in schools in England) to re-launch his firm. Baltimore was at that time the major trade port in the US, as southern states sent their goods north as well as Europe while in return being voracious consumers of fine Irish linen.

Brown was soon joined by other sons and within a few years had dispatched them to set up outposts in Philadelphia, New York, and Liverpool, England. As the years rolled by, Brown Brothers became a major – if not a dominant - financial force in the young United States and England, expanding beyond linen to corporate finance including sponsoring the first initial public offering in the US in 1808.

Yet – and here is that persistent sub-theme of the book - Alexander Brown did not let the business grow too fast. Prudence was the order of the day, every day for Alexander Brown. He demanded this of his sons in numerous letters preaching careful analysis of any new business proposition. Greed and ostentatious living were the greatest sin a Brown could commit, and, in its place, he demanded a strong sense of service to community and nation. As Karabell carefully documents, it seems Brown Brothers declined more opportunities than embraced which resulted in the firm not only surviving but thriving through numerous economic and financial crisis’ in the first half of the 1800s. These crises created the Progressive firebrands of the day, the biggest and most powerful being President Andrew Jackson who denounced the big financial firms as being a relic of “nobility systems that enabled a few and rich intelligent men to live upon the labor of many.”

It is not until the latter half of the 1800’s that we meet E.H. Harriman. Born in 1848 the son of an Episcopal pastor, Harriman was a slight, slender man who – to the horror of his father - abandoned schooling at the age of 14 to work as a runner for a New York brokerage. He was a keen learner and showed a genius for finance which, at the age of 34, he unleashed by making his first big acquisition: The Illinois Central Railroad. America was rapidly expanding West and the “iron horse” was the greatest and fastest way to make that expansion happen. Harriman’s acquisition instantly become a national railroad baron. (Interestingly and conversely, Brown Brothers took a hard pass on investing in railroads, believing it too speculative and not prudent). Despite that slight physique, Harriman proved to be an extraordinarily steely businessman. The author offers a fantastic look into how Harriman soon took on legendary financiers/railroad barons J.P. Morgan and Jacob Schiff (head of Kuhn, Loeb & Co., the forerunner of Lehman Brothers), beating them at their own game and bending them to his vision.

E.H. Harriman was now a major financial power, and it was not long before the two firms of Brown Brothers and H.E. Harriman were working in tandem on bond deals not only in the US but in Latin America and across Europe. But Harriman, like Alexander Brown, was a man also reliant on prudence to build out his business. Despite plunging into the go-go, boom-or-bust world of railroads at the time, it was his prudent, careful management of business that made him a success, and which ultimately won him the support of Morgan and Schiff. And, like Alexander Brown Harriman produced and carefully cultivated and trained heirs to join him at the firm and eventually succeed him: Averell and Roland.

Averell would, of course, go on to be Governor of New York and something of a legendary diplomat. He was the big idea guy, less so the day-to-day manager type. That was Roland’s forte. A prudent (there is that word again) and a strong manager who helped assemble a team of brilliant bankers who shared a nose for smart, careful yet financially rewarding deals.

The rise of Averell and Roland as leaders of H.E. Harriman in the 1920’s brought the most natural alignment with the men leading Brown Brothers. The bond was school, specifically Yale University where they all seemed to be members of the elite Skull & Bones Society or other elite societies and where their friendships for life were bonded and marriages even made them relatives (Alex. Brown in Baltimore along with the other affiliate set up in Liverpool nearly a century before, Brown Shipley, had effectively split off decades before due to US tax law changes).

It is here that Karabell demystifies – and also confirms – the clubby world of early 20th century Wall Street. Indeed, the belief in the US at that time that “…a small clique of elites pull[ed] the strings…usually centered on coastal elites that the Browns and Harriman’s epitomized” was strongly held by much of the country. In 1930, that opinion only grew as the boys from Yale were not only financing the biggest companies in America, quietly making big fees despite the stock market crash and resulting Great Depression but were now going to merge.

And where and how was the merger arranged? On a private train going from New York to New Haven, Connecticut to attend the Yale football homecoming game. Of course. Over fine scotch and good cigars, they worked out the details, smoothly bringing together the great financial houses into one. The result would have a much bigger impact on US and world history: The merger elevated a young Prescott Bush – father and grandfather to future US Presidents – as leader of the combined firms.

Today, the firm’s history and culture speak for itself. Yet, in today’s modern financial world, Brown Brothers Harriman stands as a stark anomaly to other firms. Too many on Wall Street, it is somehow seen as shrinking, fading business. But this is factually incorrect. It is still run as a partnership, having eschewed the big money the other large firms grabbed via listing themselves on the stock market. It is indeed a successful firm, and it is successful in the businesses it has chosen to pursue. Moreover, unlike virtually every other large investment bank and brokerage, Brown Brothers Harriman is never in the news, never engulfed in intense regulatory scandals that has hit every big-name financial house over the course of the last 30 years.

Karabell argues that over the years we seem to have quietly changed the definition of capitalism and what constitutes success in financial markets. “In what universe does surviving and thriving for over the course of more than two hundred years constitute failure? In what healthy system does never becoming too big to fail get judged negatively? Why is sustaining a culture that shuns the spotlight and remains both viable and modest not valued, while becoming a behemoth is celebrated and reviled? Why is Michael Milken a parable, while Brown Brothers a faint echo?... Over the centuries, they [Brown Brothers Harriman] made considerable money, and much of that money made America. For two hundred years, the firm stuck to its last.”

Karabell is spot on in his challenge, one all of today’s titans of Wall Street should pause to consider as we enter a rapidly changing and increasingly turbulent world.