In Pursuit of Wealth: The Moral Case for Finance

by Yaron Brook, Don Watkins

In this new book, In Pursuit of Wealth: The Moral Case for Finance, Yaron Brook and Don Watkins dispel the prevailing negative myths about finance and clearly lay out the industry’s virtues within a moral framework. This ambitious book shows readers how we can reframe societal mores and end the vilification of financiers.

“This book destroys the myth advanced by Bernie Sanders and Elizabeth Warren that, because it is driven by greed, Wall Street (the financial market) is the source of our economic challenges. Brook and Watkins prove the opposite, which is that finance, because it is a fundamentally moral activity consistent with man’s essential nature, is productive, innovative and a gigantic creator of economic well-being.”
—John A. Allison, Retired Chairman and CEO BB&T, Retired President and CEO Cato Institute
“The 2008 financial crisis, taxpayer bailouts, and reckless Federal Reserve monetary policy, have enabled the left to both vilify the financial industry and shift the blame for government created problems to Wall Street. Yaron Brook and Don Watkins provide a much-needed counterbalance to this false narrative. Absent government and Fed interference, finance is an integral component of a vibrant free market economy, where value is not extracted but created. If liberal grandstanding and a biased media have blinded you to the truth, this book will open your eyes. ”
—Peter Schiff, CEO of Euro Pacific Capital and author of The Real Crash: America’s Coming Bankruptcy—How to Save Yourself and Your Country
“An insightful collection of essays that gets to the heart of finance and its tremendous value. Yaron and Don do a masterful job of taking on complex topics and applying concise, objective analysis. It’s rare to find a book that looks at finance from both the economic and moral sides—all while being an enjoyable read.”
—Dmitry Balyasny, Balyasny Asset Management
“The political issue of our time is, ‘Who caused the financial crisis?’ If you believe, like most people, that it was greedy bankers and an immoral financial system, then most socialist policies are justified. If you believe that only bad government policies could cause a problem that big, then no socialist policies are legitimate. Brook and Watkins in an easy to read, breezy style dismantle the greedy banker argument and illustrate how primitive arguments made more than 2,000 years ago are still with us. This book is a must—especially for non-financial types.”
—Jeff Yass, Susquehanna Investment Group


“A cogent book explaining why profit motive, wealth creation and independent financial systems are moral imperatives.”
—Avery More, Venture Capitalist

Genres: Economics, Finance, Philosophy, Nonfiction, Business

278 pages, Kindle Edition

First published September 20, 2017

About the author

Yaron Brook (Hebrew: ירון ברוק‎; born 1961) is an intellectual and political activist, and is the current president and executive director of the Ayn Rand Institute, a non-profit organization in Irvine, California, whose mission is to promote the novels of Ayn Rand and her philosophy of Objectivism.

As head of the Ayn Rand Institute (ARI), Brook has become a well-known advocate of Objectivism. His philosophical activism includes teaching and public lecturing at ARI-sponsored events and conferences held predominantly in North America, speaking and debating at numerous American universities, delivering seminars for businesses and corporations in the United States and abroad, and writing opinion editorials for leading newspapers and websites.

He is a columnist for Forbes.com and a contributing editor of The Objective Standard. He regularly speaks at universities, corporations, and professional and community groups across America, addressing a wide-range of current events and philosophical issues from an Objectivist perspective. He is a frequent radio guest on The Thom Hartmann Program, which is carried by the Air America Radio network, as well as a weekly guest on the Fox Business Network. He is a frequent guest on The Fox News Channel, on programs such as the Glenn Beck Program, and on CNBC programs such as On the Money and Morning Call. He has been interviewed for his expertise on the Middle East, foreign policy, economics and business ethics. Brook's writings and interviews have also appeared on Glenn Reynolds' Instapundit.

Reviews

[Gary · Rating 1 out of 5]

Brook is a psycho

[Ron Housley · Rating 4 out of 5]

In Pursuit of Wealth: The Moral Case for Finance
by Yaron Brook & Don Watkins

A short Book Report by Ron Housley


Ever since my High School days, I’ve heard the claim that our national financial woes are all due to government injecting itself by force into the economic system.

Most of my friends cavalierly dismiss these claims without an ounce of reason, asserting that without regulations, the unscrupulous would acquire power over us all — and it is their article of faith that such a horror must be prevented, via government regulations.

Now comes a new book to shed welcome light on this century-long confusion embraced by Republicans and Democrats alike, by pundits and journalists across the political spectrum, and by college professors everywhere.

Nowhere in my formal education was I presented a vision of what society would look like had government coercion (regulations special favors, bailouts, subsidies, etc.) never been allowed to take over. And nowhere in my early education was it ever made clear that all of those early banking panics were entirely the consequence of government imposed rules, regulations, laws.

In High School we were indoctrinated to believe that the banking panics of 1837, 1857, 1873, 1893, 1896, and 1907 were all the result of too much liberty; we were primed to accept the eventual “solution” of taking away even more liberty (imposing the Federal Reserve) from everyone, as a way to keep greedy entrepreneurs under control, to keep the capitalists from destroying us all(!).

The lesson which I was never taught in school, the lesson which “In Pursuit of Wealth” makes clear, is that every banking panic was born of government sponsored force into an otherwise free system — resulting in unwanted distortions, distortions which invariably required a painful “panic” to correct.

It’s as if there were a “vast conspiracy” to hide from us the role of government force in degrading our economic lives all these years. And it’s as if nothing could have been more natural than the gradual, but steady, increase of government force injected into every aspect of our lives over all the years since America’s founding.

If the biggest story of the last two centuries has been the attack on reason and liberty which came on the heels of America’s founding in 1776, then Brook’s and Watkin’s story of the attack on liberty in the world of finance is just one piece of the bigger puzzle. We are taught in our history classes a litany of events that have taken place throughout the years, but rarely are we enlightened about the underlying ideas which “drive” those events.

Here is a book which uncovers some of those driving ideas.

On the cultural level, Hollywood portrays businessmen as far more likely than serial killers or terrorists or gangsters to murder us. “By the age of 18, the average TV viewer has seen business men attempt more than ten thousand murders.....in the name of greed.” We are literally indoctrinated to the belief that businessmen are evil and need to be controlled by force, by regulation. Our culture imbues us with the notion that the businessman is intrinsically evil, that he must be reined in by applying government force against him.

In other words, there is no case to support liberty in a country which was founded in order to support liberty.

The attack on reason and liberty was launched almost before the ink was dry on the U.S. Constitution.

This current book sheds important light on that attack in the realm of finance and the creation of wealth itself.


Early in the book, Brook & Watkins admit to us that it would be “enormously complex” to paint a picture of why a free financial system would be resilient rather than unstable. But without such a clear picture, government force will continue to grow; without a clear picture there will remain no credible opposition to the expanding juggernaut of statism befalling us all.

We need counter-point to Das Kapital and The Communist Manifesto from the 19th century where Marx painted his own “extremely complex” picture of liberty as unfair and doomed to fail; we now need a comprehensive, “extremely complex” picture of what liberty would look like. Until that picture is painted, there is little chance that the masses will be drawn in to pursue it.

I am grateful to Brook & Watkins for their most excellent introduction and summary on the liberty side; what we need now is the “extremely complex” version, before any mass pro-liberty movement can be expected.

I hope that Brook & Watkins will take up the challenge of coloring in that “extremely complex” picture — as part of their goal to philosophically change our culture to once again embrace reason and liberty.

[Robertas Bakula · Rating 5 out of 5]

This moral case for finance is beautiful and inspiring. The best summary of it is captured in the brilliant example. Imagine a reasonable Alien comes down to Earth and observes our financial system. Here is how a conversation with a human would go:

Alien: So let me get this straight. You give someone your money, and then later on they just give you back a bunch more money?
Human: Right.
Alien: And then there are complete strangers who will give you hundreds of thousands to buy a house or a car?
Human: Yep. You just have to promise to pay them back later.
Alien: Man, on my planet you can’t even get a friend to loan you money for a pizza. And you say there are actually people who will give you tens of millions of dollars to start a business—and if it fails, you don’t even have to pay them back?
Human: Sure.
Alien: Wow. These must be the most popular people on your planet!

Only they are the complete opposite of that – they are vilified, attacked, persecuted, jailed, or even killed in more barbaric times like Middle Ages dominated by Christianity. This is the massive injustice we live with – and nobody cares. Yet everybody should care, because the financial industry, and financiers themselves are the heart of our modern lives, of progress, of innovation, of increasing standard of living, and thus play a crucial, irreplacable role in human happiness. Anyone concerned with these things and with moral justice will benefit from arming himself with intellectual ammunition provided in this book.

[Kyle · Rating 5 out of 5]

This book is for anyone who wishes to unlearn many of the misconceptions and economic fallacies that are taught in public schools (including universities). It is not a guide on how to pursue wealth but rather a moral defense of those who have chosen to pursue wealth as their profession or anyone who desires to live prosperously without feeling moral guilt for what they have earned. The major premise of this book is to disprove the moral standard largely accepted by society in regards to finance and business. The book posits a strong moral case with significant historical evidence to provide background on the author's views. Anyone with a decent high school reading level should find this book easily comprehensible and enjoyable. I would especially recommend this book to students of finance or those who wish to have a strong, positive moral case for the field and career they have chosen. Even if you are not a student of business/finance, you will still be able to comprehend the book.

Some of the specific misconceptions and economic fallacies this book deals with involve the causes leading up to and actions taken during the Great Depression and 2008 financial crisis. This makes the book especially useful to students of history or anyone who enjoys reading historical content.

Although this book is not a guide on how to pursue wealth, it will however assist anyone who wishes to achieve a greater understanding of what financial markets are and how the various forms of markets work whether you desire to be a casual investor or wish to make a career out of it.

Principally, this book is necessary for a healthy understanding of how and why financial markets work and why every individual should be defending financiers rather than attacking them or considering them morally inept.

[Mattjmjmjm · Rating 4 out of 5]

The main point is a simple, Finance is not always a zero sum game. By loaning money, investing and advising wealth is created, there would be no place for savers to have their pool of capital used by business people, there would be no economy really. Like any service, if someone values it enough to pay for it, there is value despite thousands of popular opinion on how greedy bankers/money lenders are. A therapist and hair dresser offer a service, it's not some car made in a factory but for some people think finance is inherently more greedy because it's not "productive" in a sense of making something, this seems to be some leftover idea from marxism with it's focus on creation of physical products and some like Noam Chomsky attacking the rise of the financial industry in america at the expense of manufacturing. Without the growth of finance and for example venture capital, many projects would simply not exist. There is a good reason for regulation, the EU does a huge amount of regulation on technology products/services but some would say at the expense of europe's own tech industries. Value is not just hard work making some product, it's the ability to convince others that the product you are offering is worth more than the money in their pocket, the requires idea, direction and financing at a large scale. There is greed and there is misconduct, maybe could be proven to be more greed in finance than other industries otherwise any complex organisation has abuse of power, financial, racial, political and sexual.

[عدنان العبار · Rating 4 out of 5]

This is one of the books I would recommend to everyone who thinks finance and economics are boring sciences.

I remember discussing with my friend Feynman's debate with his painter friend. His friend says that scientists don't know how to appreciate beauty, whereas Feynman tells him that it is science that really allows one to see the REAL beauty in all things, the natural depth and complexity of things. And I was wondering why poets and novelists and playwrights, who usually have a very high inclination towards beauty, become extremely shallow when it comes to economics and finance, and philosophers, too.

Economics is the study of human action, and it is just so beautiful to those who would understand it. To those who scorn at these things, I am reminded by the brute who looks at a flower and says, so what? Or that's a vulgar object submitted into the mud. He can't see what is so immensely beautiful in the flower, and why we appreciate it so. The same goes for money and economics and finance.

What I like about this book is that it has heavy-weight Randians like Yaron Brook and Don Watkins, and they are unrelenting in their punches against those who misrepresent economics and the free-market ideal to belong to the party of the decrepit, the party of fads, those among the left and the right who cannot think rationally, but are taught what to think about A and B and C and D.

[Blast Stormfist · Rating 4 out of 5]

While I agree with with the authors that the most efficient and beneficial financial mechanism for society is a free market unfettered from government intrusion, I think it's a fatuous overreach to claim laissez-faire capitalism is a basis of morality. Were my neighbor to ask for a lift somewhere because his automobile no longer functioned, I shouldn't pat myself on the back as a good person if I whipped out my phone and purchased 500 more shares of Ford stock in response to his personal crisis.

Moral behavior, regardless (usually) of the ethic it's based, is grounded in selflessness, sacrificing something beneficial for the betterment of someone else, be it time, money, etc. There is no better example of how seemingly confused Mr Brooks is on the topic than when he makes an absolute mess of his interpretation of biblical edicts against usury. He fails to take in to account the covenant between God and his chosen people. It never once states usury as being immoral in general; it was a prohibition for particular parameters within the tribes of Israel. They were a backwater people lifted up by a omnipotent provider, who facilitated the Jews escape from bondage, a divine GPS in doing so, and food from heaven. Charging interest to a destitute fellow Jew while receiving explicit divine blessing would be a tad hypocritical, no?

[Max Patiiuk · Rating 5 out of 5]

Favorite quotes:
- (from 2006 column in Wired): "Jobs was nothing more than greedy capitalist who amassed an obscene fortune. It's shameful". I always assumed that wired being degrowth was a recent thing. Impressive to know that they were communistic even 20 years ago.
- (from John Locke) "The purpose of government is to protect the rights of industrious and rational from violation by quarrelsome and contentious".
- (from Paul Krugman) "Although the principle of equality of opportunity, not equality of results, sounds fine, it is a largely fictitious distinction. A society with highly unequal results is more or less inevitably a society with highly unequal opportunity too."
- "Wealth is not actually a pie belonging to the nation as a whole. It consists of particular values created by particular individuals, often working together in groups, and belonging to particular individuals. It is not distributed by society. It is produced and traded by the people who created it. To distribute, society would first have to seize it from the people who created it"
- "The cure for people seeking special favor from the government is to create a government that has no special favors to grant"

[Daniel · Rating 3 out of 5]

The book is a great read but I feel uncomfortable with the ideas professed. Yaron at once unashamedly defends the finance industry for all the evils in society while lumping all the blame on government regulation. I came out of the book feeling like finance honchos are the untainted moral freedom fighters while the government is the envious duffer who doesn't understand the principles of freedom and whose main intent is to slow down progress and to curtail individual advancement.

Yaron, on behalf of the financial industry, absolves them of all blame for financial crises. He skirts all reason including greed and wholesomely argues that even greed can be checked by the free market, and not the government. His arguments carefully avoid contemporary evidence that unchecked financial markets cannot self-regulate.

What he gets right, though, is that personal ambition isn't immoral - rather, it's the epitome of morality. However, he fails to acknowledge that personal ambition should be checked by a third party and not just luck.

[Robin Gane-McCalla · Rating 4 out of 5]

This book provides a history of finances and an explanation of its morality. It begins well with two long articles about why finance is moral and a history of the condemnation of money lenders but most of the other articles are less substantial or riveting. Several are very short and offer limited explanations to common objections of finance.

[Ian McGaffey · Rating 4 out of 5]

This was a very interesting look at the way finance has been deemed morally corrupt despite all it has done for societal advancement. I quite enjoyed the way the authors laid out their ideas and showed how a different perspective changes everything. Definitely a side of the story you don't hear very often.

[Andrew · Rating 2 out of 5]

A good book could have been written on the topic, but the author was too busy being political to actually dig into the facts at hand and make a convincing point. Ultimately the book left me less convinced of the author's point (that the finance industry should be given a pass because of the services they offer society) than if I'd not read it in the first place.

You'd be much better off to read some economics guide by Thomas Sowell and try to fill the rest in by imagination.

[Nathan Smith · Rating 5 out of 5]

This is a very interesting book that explains both what financiers do and
the importance their work has in a productive economy. Without financiers, our lives would all be lessened, and this, in short, is why their work is so morally important. A very valuable book for anyone interested in how our economy functions.

[Houssem Hajlaoui · Rating 5 out of 5]

The authors brings the facts of finance to debunk some of the most common misconceptions about money and finance.
Most importantly, the authors challenges the established moral views about greed and the self-interest motivation of wealth.

[Luke · Rating 5 out of 5]

So far, this is my favorite from Yaron Brook.

[Tom Nowak · Rating 4 out of 5]

This book also goes into the history behind finance, both the good and the ugly side of it. This is a really good read, even if you only have a precursory knowledge of finance and/or economics.

[Lilia McKenzie · Rating 5 out of 5]

Amazing and thought provoking book about capitalism. If your into capitalism and economics and banking history this is for you.

[Asaad Kundo · Rating 5 out of 5]

a very intersting approach to finance

[Mimi Stein · Rating 2 out of 5]

Lots of good history-of-finance information. Comparisons to Canada’s system. That’s good.

But...Ayn Rand acolyte. Just...we’re past that now, right?

They doth protest too much; poor fellas apparently believe everyone is mean to them or hates them because they’re in finance. Where’s that violin?

I worked in finance; haven’t had that problem. Funny, that.

So, as a result of this notion (and ignoring the possible individual character traits and historical abuses) the writers go on the offensive to say that what they do is good, and everyone should stop being mean to them and stop disagreeing with them, and government is very bad and there is nothing bad about income and wealth inequality because rich people should always just get richer and everyone else is a communist ooooo scary evil bad socialists! See what I mean? Silly.

Whoever said finance was “bad?” Finance is fine; the problem is all the greed and fear, and the people who are destroyed by it, the people who abuse the market, including the liars, the conmen, and a system that supports gamification and concentration of risk, to negative effect.

That said it was well-written and easy to listen to on audiobook. But they lost me when they defended Madoff and inside trading. Please.

[George · Rating 5 out of 5]

Excellent read

I am outstanding book summarizing the key points of finance and economics. It has aged quite well, unfortunately, as I would have liked to have seen some of their solutions implemented.

[Zachary Batty · Rating 5 out of 5]

Phenomenal read and great discussion within the finance world. I'm often stumped on how to answer why finance is in fact good. This book helps with those points.