Saturday, May 04, 2013

Book: The Money Bazaar by Andrew Krieger


Feeling like doing a spot of cardio work in the gym today, I thought I'd take this book to leaf through while pedalling away on the exercise bike. I was completely hooked after the first few pages and by the time I was done cycling I had made it a third of the way through. Not bad goings. I finished it off later in the day, making this the first proper book I have read cover-to-cover in a single day.
 
I'm surprised that I hadn't heard of The Money Bazaar until a few weeks ago. The author is Andrew Krieger, a famous currency trader who controversially shorted the New Zealand dollar and made a few hundred million for his employer before moving on to work for Soros' legendary Quantum Fund.

Krieger has done a great job with The Money Bazaar. It was published back in 1992 when most currency deals were still voice brokered and the world balance of economic power was completely different, which lends an interesting contextual angle. The first few chapters provide an introduction to the market and currency trading from an autobiographical perspective, and the final chapter also closes with a personal reflection. In between we are given a clearly written explanation of the evolution of the market as Krieger discusses the impact of policy decisions such as The Plaza Accord, the Bretton Woods Agreement, the Smithsonian Agreement and the Louvre Accord. This may sound dull but the events marked pivotal points in the development of the currency market. Also, because Krieger writes of the evolution from a trader's perspective versus that of a dry academic, we are provided with a unique insight rarely afforded to the lay man.

Overall, this is a great book for those with an interest in the currency markets. It is not a 'how to trade' book - there are plenty enough of this type of book out there and I wouldn't touch them with a barge pole - but provides wisdom and lessons by explaining how we got to the current state of competitive, freely floating exchange rates.

 **** 1/2  - The Money Bazaar is out of print but can had second hand on e-bay or Amazon for a song.

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