I don’t quite remember how I found and picked up this rather esoteric book, I assume it lurking amidst the pile of books that Amazon’s recommendation algorithm keeps churning out – and mighty successfully at that it seems. For the uninitiated, this is a irregular choice because this is a book written – hold your breaths – in 1965. To drive the point home more effectively, that’s over half a century ago. There’s an interesting story on how this book rose into prominence after being recommended by Bill Gates on Forbes. Long story short? It wasn’t even a best seller by any means. It was out of print, was revived from the dead by Gates’ comments, given CPR by an enterprising firm which specialised in actually converting old tomes to e-books which then watched as the previously dead & buried work proved it was alive and kicking as it raced to the New York Times’ Bestseller list.
Reading this book isn’t the easiest of experiences though. I feel I keep mentioning this time and again with every book I read and I’m trying to think why. I guess the reason is that we’re all pretty pressed for time in our lives today. And the only reason I’m reading a non-fiction work over a nice fictional one is that I’m hoping to learn something from it while enjoying the experience of reading as well. The moment that experience is no longer fun (and it has to compete with my smartphones, movies on the television, IPL games and a multitude of other distractions) and the book starts to seem like a textbook – the incentive to actually willfully take time out to enjoy (or ‘relish’) it goes down.
Some expectations from a 50 year book are to be had. That the tales will likely be out of date (I’m assuming even Bill Gates read it many years ago and not in 2014). That the writing style would be considerably different and indulge in plenty of perambulation before getting to the point. Examples may be difficult to relate to due to a generation gap and them being Wall-Street (read : America) centric. And most of them are true. Especially the one about all of them being too long. That however doesn’t take away from the book’s mission if you’re looking to learn something, there’re definitely things to pick up and imbibe if you read it properly. After ploughing through 3 chapters and with this in mind, I’ve decided not to shove it down my throat all at once but read a chapter at regular intervals. I shall keep adding about each of these ’12 classic tales’ over time here.
1. The Fluctuation – The little crash in ’62
Information #1 : There was a large stock market crash in 1962, second only at that time to the Great Depression of ’29. This tale seeks to explore why that may have happened and the machinations on the ground as it actually did. It was a week of heavy fluctuation in the stock market in May 1962 – it’s now apparently known as the Flash Crash of ’62. Intersting to observe how stock markets actually worked in a pre-computer era : ticker-tapes with details printed on them were churned out throughout. As more and more activity happened on the floor of the exchange, the more of a ‘lag’ the tape had which led to its own set of complications. Mysteriously, the markets rebounded though – unlike what happened in 1929. Why? They didn’t know in ’29, Brooks’ can’t put a finger on it in ’62 and almost 50 years later – reverse engineering aside – we still didn’t quite know for sure what hit us in 2008 either.
Although a computer that can read the NYC phone book in 7 minutes was a big deal then. Heh. How far we’ve come yet how little we’ve progressed.
2. The Fate of the Edsel – A cautionary tale
I’m kind of embarrassed as a management student that I hadn’t even about the Ford Edsel – the greatest failure in the automobile industry in history then, and I guess even today? Then I remember we’ve probably been used to looking at more recent ones like the New Coke. This is a solid post-mortem of the entire experience – of the dream car which was almost assumed to be a monster hit but which for reasons unfathomable, tanked. Brooks’ spends a good deal of time here separating rumour from fact, this is the classic case-study model which you will see in business schools across. Was it the poor naming? Was it the design? The excessive faith in consumer surveys? None of these as per Brooks who tells us why none of these really were the real reason. He doesn’t necessarily give a clear answer to what the real root cause was either. In the end it was probably bad timing of launch, taking too long from inception to launch, internal cannibalization, poor attention to detail for some of the initial batches which created poor first impressions and a dollop of managerial hubris. The colossal damage did not do much wrong for Ford which 50 years later is still going strong.
3. The Federal Income Tax – It’s history & peculiarities
I thought this would be a bit of a drag given that I’m not particularly comfortable with tax systems of my own country, let alone that of another one but was pleasantly surprising. There’s a bit about the history of income tax systems, the evolution of the income tax in the US, the principles of taxation and why they aren’t necessarily true anymore (the tax the rich more principle), loopholes in tax systems and how they came about : capital gains tax, restricted stock options and amongst others, a mysterious option of saving tax for oil-well owners which I assume is quite redundant today. It also looks at the possibilities of changing the tax collection system and alternatives, why they won’t work, the tightrope between a simple tax code (which is likely to be unfair) and an extremely complex one (which allows for exceptions and exceptions to make it fair and equitable). There’re nice perspectives such as the focus on voluntary compliance and how that culture was evolved, versus an IRS which goes knocking on everyone’s doors; how taxation has actually given rise to a generation of smart people who’s skills are being to the test to save rich people more tax money and surprise-surprise : how people are ending up business and pleasure just to save tax (basically to defer personal meetings & entertainment as official ones to make them exempt of tax). Quite a few things really don’t change!