Life in the Financial Markets: Daniel Lacalle’s Insider Defence of ’The Markets’
Daniel Lacalle, a hedge-fund manager and well-known financial analyst, takes us on a fascinating journey into the world of high finance, an environment most people know nothing about. He tells the story in the first person. The book I read was the Spanish original, Nosotros, los mercados (2013); Wiley published the English version as Life in the Financial Markets in 2014.
Author: Daniel Lacalle, economist and fund manager
Title: Life in the Financial Markets: How They Really Work And Why They Matter To You (2014); Spanish original Nosotros, los mercados (2013)
Format: English Kindle edition (Wiley)
Scope: An insider’s explanation of financial markets and a diagnosis of the financial crisis
Amazon: www.amazon.es/dp/B00OW1V1AG (ASIN B00OW1V1AG)
What Are ‘The Markets’?
Finance is a sector we barely understand and often refer to, dismissively, as ’the markets’. The aim of this book is for us to understand what they are, how they work and why they are indispensable. In Spain it was the first book of its kind written by a Spanish author from inside the industry itself.
A Passionate Defence
The author passionately defends the honesty, the seriousness and above all the essential, irreplaceable role that financial operators play in today’s economy. He outlines a diagnosis of the crisis that is certainly not the most comfortable one, but that offers a hopeful and credible way out of our current problems.
Drawing on his professional experience, Lacalle takes on some of the myths about hedge funds and financial traders, and gives his view of the causes of the crisis and the ways to overcome it.
An Insider’s Career
Daniel Lacalle, born in Madrid in 1967, spent years as an analyst and portfolio manager in the energy sector and in investment funds, working in London and elsewhere before becoming a prominent commentator and chief economist in the Spanish investment industry. The book draws on that experience: he explains what traders, analysts and fund managers actually do each day, and how decisions are made under pressure, with anecdotes from the trading floor.
From Nosotros, los mercados to English
The Spanish original, Nosotros, los mercados (We, the Markets), appeared in 2013, in the aftermath of the euro crisis, when Spaniards heard daily on the news that "the markets" were punishing their country. Lacalle’s title makes his point: the markets are not a faceless enemy but, in large part, ordinary savers, pension funds and insurance companies investing on behalf of millions of people. The English edition, published by Wiley in 2014, adapts the argument for an international audience.
A Clear Point of View
Lacalle writes from a free-market position. He is critical of excessive public spending, of debt-financed growth and of central-bank intervention, themes he developed further in later books such as Escape from the Central Bank Trap. Readers who share his views will find the book bracing; those who do not will still learn how markets work, though they may want to balance it with a different perspective.
For Readers Who
Want to understand financial news, bond yields and risk premiums without an economics degree, or are considering a career in finance. It is written in an accessible, conversational style, which suits the reviewer’s point that it opens a world most people know nothing about.
The Reviewer’s View
The original review found the book fascinating precisely because it opens a closed world. That is its strength: few insiders explain their profession so openly.
Who Should Read It
It is written for curious readers, not only for professionals, and it helps to read the financial news with a more critical eye. Whether or not you share Lacalle’s liberal economic views, he explains clearly how the people behind the headlines actually work.
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