Book review: 'Wealth, War & Wisdom'
By Claes Bell • Bankrate.com

Who should read it
Investors who have lain awake at night wondering what would happen to their life savings in a true doomsday scenario.

Synopsis
Through a thoughtful and surprisingly engaging analysis of stocks, bonds and other investments through the war years, author Barton Biggs comes to some interesting conclusions.

Counter to the conventional wisdom that the stock market is at best random and at worst dumb as a bag of hammers, Biggs finds a remarkable ability on the part of U.S., British and German stock markets to predict the twists and turns of the war.

Stock prices peaked in Berlin right as the German armies came within a few miles of Moscow (German leaders didn't know it was the high-water mark, but the market did). The New York Stock Exchange was quick to understand the importance of the U.S. Navy's seminal victory at Midway and responded with a bull run.

Book review "Wealth, War & Wisdom"   Author: Barton Biggs   Publisher: John Wiley & Sons   Available in hardback

In poring over the stock market data of the '30s and '40s, Biggs comes to the surprising conclusion that stocks perform remarkably well in a disaster. Over a long enough horizon, a well-diversified basket of stocks would have been among the safest investments in most of the countries that didn't end up behind the Iron Curtain.

But perhaps most fascinating are Biggs' case studies of individual investors and how the decisions they made influenced their fates: The Hungarian nobleman forced to leave his wealth behind, ending up as a horse riding instructor on Long Island; the wealthy German Jew who, forced to sell his business for the price of 10,000 canaries by the Nazis, rebuilding his fortune by selling pets in New York.

From these stories, Biggs extrapolates that the best way to save your money in a true disaster is by investing in the assets that are often frowned upon in better times -- precious metals, farmland, stashes of cash in foreign countries. And sometimes, when those fail, Biggs concludes, "Brains or a skill are ... the best wealth preserver."

Strong/weak points

• The good: "Wealth, War & Wisdom" is at its best when it sticks to its premise of understanding the war from an investor's perspective. His clear and lively writing style and his deep knowledge of markets and investments will entertain readers as well as educate them.
• The bad: The trouble with any book about World War II is that the subject is so huge it's all too easy for an author to lose his way among the dizzying array of characters and events. Unfortunately, Biggs is no exception. Some readers will probably be bored by the sometimes tedious minutia of World War II history here -- Churchill's spoiled son or Hitler's dislike of smoking.

Takeaway
Overall, the book is a mostly entertaining, always illuminating look at how to survive, and even thrive, in the worst of worst-case scenarios. Biggs' brainy but engaging writing and careful research provides a window into what happens to wealth in "a time of cholera," and how to make sure you, your family and your savings survive.