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More Money Than God: Hedge Funds and the Making of a New Elite
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More Money Than God: Hedge Funds and the Making of a New Elite

3.97 of 5 stars 3.97  ·  rating details  ·  2,206 ratings  ·  92 reviews
"Splendid...the definitive history of the hedge fund, a compelling narrative full of larger-than-life characters and dramatic tales." -- "The Washington Post"
Wealthy, powerful, and potentially dangerous, hedge fund moguls have become the It Boys of twenty-first- century capitalism. Beating the market was long thought to be impossible, but hedge funds cracked its mysterie...more
ebook, 496 pages
Published June 1st 2010 by Penguin Books (first published January 1st 2010)
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Jon
Mallaby not only presents the definitive history of hedge funds, starting with the first one (created by A.W. Jones in 1949), and continuing through the recent financial crisis, but he also makes the argument that hedge funds are the best alternative to the megabanks on Wall Street.

That's a pretty controversial claim. Certain funds (like Long-Term Capital Management) have completely imploded, and some hedge fund managers have been fined for fraud. And yet, after reading this book, I'm sympathet...more
Ilya
In 1949, an American sociologist and a former diplomat and anti-Nazi operative decided to get rich. He organized a "hedged [sic] fund" that bought shares in the companies he deemed promising, and sold short shares in the companies he deemed unpromising, doing all this on borrowed money. The top marginal income tax rate at the time being 91%, he took 20% of the profits on the investments, which were taxed at the much lower capital gains rate of 25%. If all of the original $100,000 had stayed with...more
getAbstract
A gripping hedge fund history lesson

As hedge funds increase in size, variety and number, they also exercise growing power over central banks and national governments, as well as companies and industries. Unfettered by a fixed investment philosophy, hedge fund managers bank on the flexibility to buy assets and sell them short as dynamic markets dictate. Some hedge funds have succeeded spectacularly and some have failed, such as those holding too many mortgage securities when the U.S. housing indu...more
Ryan Stambaugh
The book is a first-rate piece of non-fiction. Mallaby scans the history hedge funds over the past 60 or so years, with most chapters focusing in on an economic event and particular fund manager or hedge fund responding to such. (One minor quibble is Mallaby never quite says why A.W. Jones gets credit for developing the first hedge fund over, say, Benjamin Graham or John Maynard Keynes.)

Along the way you learn quite a bit, also, about the financial scene going on at the time; from the commoditie...more
Owen
This was one of the best descriptions of how the financial system makes money that I have read. This could stem from the fact that it built on top of the earlier information I had, but, in any event, I came away from this book with a much clearer understanding of the workings of the stock market than I had before, and I actually went back and re-read some things I had read earlier and they made more sense.

The author is quite in favor of hedge funds. I'll stop short of saying he is in thrall, but...more
Simon
What's that song, "I wanna be a billionaire so freakin' bad, buy all the things I never had", that would go great with this book. Good historical account about the origins and evolution of hedge funds, but was also a bit of hero worship at the same time. Entertaining read, and actually did learn some interesting new things. Would actually recommend it for both the average person and finance professional.
Ravi J
Its insane when Hedge funds can lose hundreds of million dollars per hour in some cases and still come out on the right side of the trade.
It does try really hard to show the Hedge funds in a good light (providing liquidity, making prices more efficient etc.), But it is really hard to fathom the cases of Soros and Druckenmiller when they willfully killed the Sterling and then the Thai Baht.
Loved reading the book, these guys (hedge fund managers) are hyper alpha males, and willing to go all out to...more
Anurag
The book is indeed a crime novel treatment of its subject. The protagonist here is Mr A.W. Jones who escapes Nazism as an early Marxist and ends up in the financial industry with his ideas on financial leverage. The treatment of later market geniuses is no less dramatic. The author's privileged access to interviewees gives us a glimpse inside the minds of ultra-rich hedge fund owners and the process of unwinding when market goes awry.

Unfortunately, Mallaby does not seem to be a supporter of quan...more
Harry Barnett
The subtitle is Hedge Funds and the Making of A New Elite. I picked up this book after it was recommended by Fareed Zakaria on CNN. The author, Sebastian Mallaby, wrote for the Economist for thirteen years and now is a columnist for the Washington Post.
You might have seem the term "hedge fund" in the press but not really no what they are, who invests in them, and how they invest. This book gives you a history of hedge funds starting from the first hedge fund in 1949. Some of the more significan...more
getAbstract
A gripping hedge fund history lesson

As hedge funds increase in size, variety and number, they also exercise growing power over central banks and national governments, as well as companies and industries. Unfettered by a fixed investment philosophy, hedge fund managers bank on the flexibility to buy assets and sell them short as dynamic markets dictate. Some hedge funds have succeeded spectacularly and some have failed, such as those holding too many mortgage securities when the U.S. housing indu...more
Mac
Sebastian Mallaby makes a fairly convincing argument in favor of hedge funds here, and it’s hard to dismiss the romance of idiosyncratic loners going off and starting their own companies that beat out Goldman Sachs. The book follows the history of hedge funds, from their beginnings with a quasi-socialist Hemingway pal to their contemporary status as the plunderers of Wall Street, and certainly a good case is made that the biggest problems with Wall Street come from the plodding, public investmen...more
Themistocles
This is an interesting book to read, but comes with a warning: only read it if you can cut through all the ethical veneer with which the author covers fund managers.

It's interesting in that it gives some detail (not much) about how fund managers and hedge(d) funds have been operating, along with several (but not detailer) case studies. That said, it's a bit more than obvious that the author really would want to be one of them guys, drooling over the way they operate and the money they make.

Fund...more
Lars
Vilified and admired in equal measure, hedge funds are the weirdest and most shadowy creatures of modern finance. This makes them easy targets for activists and opportunistic lawmakers alike. To give you an example close to home, one of the parties in the ruling coalition of my country recently made a proposal to ban hedge funds altogether.

In More Money Than God, Financial Times editor Sebastian Mallaby goes a long way in dispelling the mystique around hedge funds. He unravels step-by-step the...more
Ramsey
If you can get past the obnoxious title, this book is actually a great history of hedge funds, from their inception in the 1960s through the financial crisis of 2008. Mallaby surveys a broad range of hedge fund investment strategies and the larger-than-life personalities that devised and perfected them. His prose is neither dumbed-down nor overly academic--narrative is interspersed with analysis to great effect. The sections dealing with George Soros and Stan Druckenmiller's short of the British...more
Franklin Wang
A great read for people who want to have an introductory overview of the hedge fund industry and its development during the past century. The book is organized chronologically into a few major blocks: the founding of the first hedge fund by A. W. Jones, early hedge funds in 50s and 60s, Soros and Druckenmiller, Paul Tudor Jones, (approaching 90s and 00s) LTCM, (toward 08') Jon Paulson and a brief look at the future of hedge funds. For a lot of people in the financial industry, the names listed h...more
Isaac Rosenberg
Rating: 9/10

A fascinating, well-researched history of the hedge fund industry. The book discusses the industry's biggest successes (Robertson, Soros, etc) and biggest failures (LTCM), and the strategies that made and lost billions. It does a good job of explaining how the different hedge fund styles (macro, arbitrage, quant, long/short, distressed debt, etc) make money and how they came about. It also discusses whether hedge funds are a force for social good or evil, with some interesting, origi...more
Jason
Fantastic, highly recommended. Basically three books in one: history of major economic/financial events over the last fifty years, an analysis of hedge funds and the financial economics, and the motivation for a policy recommendation.

Mallaby has lots of nuance, appreciates the pro and con of every argument, but basically the main arguments of his book are: (1) hedge funds can get above market returns by exploiting information or anomalies that others do not; (2) in the process they improve the a...more
Marc
More entertaining than a history of hedge funds has any right to be. The book is chockfull of colorful anecdotes, and clearly demonstrates that some hedge fund titans are genuinely interesting people. Still, interesting though they may be, they also mostly come off as bunch of macho, immature, materialistic jerks, and Mallaby sometimes seems just a bit too awed by their money-making prowess, which strikes me as a rather sad commentary on him (and them).

I think that the more interesting aspects...more
Matt
The main point behind Mallaby's book is that hedge funds serve a social good and that they should not be regulated by the government. In his view, hedge funds are not a threat to the economy because, as past hedge fund failures have demonstrated, they can dissolve quietly without freezing up lending markets and/or requiring taxpayer bailouts. He contends that they are not too big to fail, that they deliver value to investors, and that they are more likely to blunt trends (i.e., bubbles) than oth...more
Jason Willson
Makes an interesting case for the need for hedge funds (and the financial disasters which for which hedge funds have had blame attributed) and the narrative follows the development of hedge funds as to how they developed into the behemoths that they are to day.
Well worth the read as another perspective on the context of the financial world of the last 50 years.
Eric
Mallaby does a masterful job at educating the reader on the history of hedge funds. Great detail on some of their rolls during the financial crisis of 2007-2009. Insider accounts of big hitter fund managers like George Soros, Stan Drunkenmiller, Julian Roberston and Ken Griffin. A must read for anyone looking to start their own hedge fund.
Steve Frank
I enjoyed this more than I thought I would. Plenty of good reviews online put this in my "eventually I'll read it" category and I should have read it sooner. It's a great history of the success and failures of many of the hedge funds out there, including lots of profiling of the masters of the funds. It was far more interesting than I assumed it would be. The author also analyzes the mystery and fear around funds, including his opinion on funds needing to be regulated (he says "no" until they ar...more
David Ball
As a manager of money, I found this book to be quite enlightening, particularly the earlier chapters profiling many of the industry's "founding fathers" of whom I knew very little. I also appreciated the author's attempt to identify each trader's "edge" - their unique skill set for outperforming the market - which got me thinking a bit more about my own "edge" and how best to develop it. The book slides a bit at the end when it it discusses a random selection of current managers (does anybody re...more
Swagato Barman Roy
An excellent book chronicling the evolution of an every dynamic industry. Even if you are not really interested in hedge funds in particular, you should read this book if you hope to make some good investments and understand the necessary strategies.
Greg
Loved this book! There is way too much to get into, but suffice it to say that the book is a history of hedge funds starting with Alfred Winslow Jones who originated the concept. A fascinating and stimulating read for anyone with an interest in economics, world affairs or finance. Mallaby, a Fellow in International Economics at the Council on Foreign Relations, gives a thoughtful and balanced account of the industry and its intellectual underpinnings. He covers the Asian debt crisis of the 90s a...more
Zbegniew
I enjoyed this book a lot and learned a lot about the natural history of hedge funds, what they do and how they do it. It helps if you already have some basic knowledge of economics and the financial markets, otherwise you may spend a lot of time looking up terms and concepts. The author's approach is anecdotal and biographical rather than analytical, which makes it an easier read. It's a pretty long book, but it kept me interested. I'd recommend it to anyone who has a basic knowledge of how fin...more
David Graham
This is a fabulous read, built around characters and tales that lend themselves to compelling narrative, and the author delivers uncorrelated returns (that was a hedge fund joke). I cannot recommend the his conclusions about hedge funds (advocating minimal, sensible regulation and enthusiastic about the strengths of hedge funds). This is not because I disagree; I suspect he is right, but I need to think more carefully about the argument.

But from a story perspective, this book is an unreserved ho...more
Christian
This was a truly fascinating read. A detailed account on what hedge funds do, why they are successful, and why they fail. Perhaps it's trying a bit too hard to defend them, but it was still refreshing to see something that does not vilify hedge funds as being a terrible thing to society and financial markets.

I was also impressed with how well researched the book was. So many details about all the various hedge funds of the last century, from the beginning of the industry to today. I had heard ab...more
Mark
Not a bad book that explores the history of the hedgefund industry. There isn't much math or financial information. This is a positive in that you don't need much background knowledge to read the book. It's a negative in that you a reader may desire more detailed information (which I did). Mallabay suggests that hedgefunds are largely personality driven and uses such personalities to tell the history (Soros, Robinson, Griffin, etc). Mallaby falls squarely into the hedgefund camp and argues for l...more
Phil
A really interesting and timely history of hedge funds from a sympathetic point of view. I can't immediately find fault with Mallaby's reasoning. I agree with the idea that partnerships are better for the country instead of publicly held massive investment banks. In partnerships, the partners have so much at stake and know that they're not going to get government help, so they are much more cautious and thus naturally not as leveraged.
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A Washington Post columnist since 1999. Worked for The Economist from 1986 - 1999.
More about Sebastian Mallaby...
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“He commuted to his Canadian office in a Ferrari, though sometimes snowy conditions forced him to use Bentley.” 3 likes
“Years later, (Paul) Jones described the mental gymnastics that went into writing these scripts. "Every evening I would close my eyes in a quiet place in my apartment ... I would visualize the opening and walk myself through the day and imagine the different emotional states the market would go through... Then when you get there, you are ready for it. You have been there before. You are in a mental state to take advantage of emotional extremes because you have already lived through them.” 2 likes
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