The Five Best Books I Read in 2020
(and what I learned from them)
In a year, in which we all had to spend way more time at home than we wanted to, I had a lot of time to read. Among the many interesting books I read this year, these five really stood out. The below are not meant to be exhaustive reviews or full summaries, but rather outlines of what these books are all about, why I loved them and in particular what I learned from them.
1. The Silk Roads — Peter Frankopan
(Bloomsbury Publishing, 2015)
The Silks Roads by Peter Frankopan is an absolutely incredible book. It actually delivers on what sounds like an impossibly large task in the subtitle: “A New History of the World”. It is a sweeping historical tour de force starting with the Persian Empire and moving through the millennia all the way into the present time. The book is a tome of nearly 700 pages, and yet it reads like a fast paced thriller.
Peter Frankopan moves us away from the familiar Euro-centric view of history, and re-centers the heart of the world eastwards by focusing on the trade routes connecting East and West as the key driving force in much of ancient and modern history. While the book spends a lot of time on Central Asia and the Middle East, and how developments there have shaped history in Europe and vice versa, it is much more than a history of the ‘Silk Road’ that connected China to Europe. The plural in book’s title refers to a much broader definition of the term ‘Silk Roads’ as the global trade networks that moved not only goods, but people, ideas, technologies, religions as well as disease and violence across countries and continents. The following is only a small selection of the many things I learned from this fantastic book, as listing everything I learned could fill a small book by itself.
I gained a new appreciation for how the desire for foreign goods was just as large a thousand and two thousand years ago as it is today. It is amazing to imagine how exotic products, such as fine Chinese silks and Indonesian spices, made their way to Western and Northern Europe in large quantities many centuries before Vasco da Gama discovered an ocean route to Asia.
I learned more about the amazing cities along the ancient silk route, many of which have been forgotten by history, and today are located in countries which not a lot of travelers visit any more. Among these cities are Merv in Turkmenistan, Balkh in Afghanistan, Bukhara and Samarkand in Uzbekistan, and Kashgar in Western China. The descriptions of contemporary witnesses give you an idea about what amazingly beautiful, rich, elegant and cosmopolitan cities they must have been. These were not only major trading centers, but due to the constant influx and exchange of people and ideas, they were also great centers of knowledge and scholarship. During the periods referred to as the Dark Ages in Europe and well into the Middle Ages, the most brilliant scholars, best scientists, most creative artists as well as the largest libraries in the world, were not found in Florence, Cambridge or Paris, but in places like Bukhara, Kabul and most of all in Baghdad, the magnificent capital of the Arab empire, which in its heydays exceeded any other city in size and splendor.
I also enjoyed learning a lot more about the Mongol invasions and about the fear that the Mongol warriors instilled even in the greatest empires of the time. Prior to the invention of gun powder there was not a weapon on earth capable of challenging or overcoming the superior fighting skills of the horse-mounted armies of the Eurasian steppes. I also discovered that the Mongols were a lot more than a horde of marauding warriors, but also very effective administrators, who successfully managed to hold on and govern the largest empire the world had ever seen.
One constant theme throughout large parts of history, was the trade of human slaves. It was a much larger and much more pervasive business throughout history, than I had previously appreciated. In fact the trading of humans as slaves often was one of the key drivers of commerce and conquest in the first place. Large empires such as the Roman empire crucially depended on slave labor in almost all aspects of their economy, and it wasn’t until the industrial revolution that machines and technology started to replace human slave labor as the economic engine of large countries and empires.
It was only in the 15th and 16th century, that the world’s center decidedly moved to the West. Two small nations located at the south-western edge of Europe, that had never before played an important role in world history, suddenly dominated almost the whole globe and opened up entirely new trade networks. It was due to their superior ships and a small handful of fearless explorers, who dared to sail out into the unknown oceans, that made Spain and Portugal the most powerful nations for at least the next 200 years. I hadn’t known before about the Treaty of Tordesillas of 1494, that literally divided the globe in two, by drawing a straight line in the Atlantic Ocean and giving everything west of it to Spain and east of it to Portugal. Staying with its overarching theme of trade routes, the book describes, how the huge influx of wealth in form of gold, silver and jewels from the Americas, drove not only the economies of Europe, but also how much of this wealth ended up in Asia. In particular the European desire for goods from India, meant a huge amount of South American gold ended up in the sub-continent and enabled grand projects like the Taj Mahal.
Skipping ahead a few centuries, I was particularly intrigued by the author’s argument, that the events and conflicts that resulted in the 1st World War, were to a large extent driven by the rivalry between England and Russia. England’s main concern and focus was to try to contain Russian ambitions in Asia, that could threaten the crown jewel in the British Empire - India. One of the greatest fears in British polities was that the Russian empire could extend its territory south into India. It was the first time that I came across the thesis that England deliberately stoked the conflict between Germany and Russia in order to distract Russia from India.
I also liked the book’s description of the events in Iran that lead to the Islamic revolution in 1979 and the hostage crisis in the Teheran embassy. Although I was aware of it, the book laid out very clearly, how almost all of the conflicts and developments in the Middle East were driven by western countries’ desire to ensure their continued supply of oil. The fear of disruption to the flow of oil from the Middle East was ever present in all of British and US politics in the 20th century.
Overall, this was one of those rare books that changed my thinking in a lot of ways, and gave me a totally new appreciation for parts of world history I really did not know enough about.
2. Billion Dollar Whale — Tom Wright & Bradley Hope
(Hachette Books 2018)
This is an absolutely unbelievable story of greed, psychopaths, corrupt politicians and bankers, and a financial and legal system that let one man get away with stealing billions and spending them in the most egregious way possible on yachts, jewelry, art and multi-million dollar parties. If this was a work of fiction, I would have said, it’s just too outlandish and way over the top to be realistic. Instead it is a true life story of what is possibly the largest and most brazen fraud ever executed.
The book follows the life of a young, chubby Malaysian man, named Jho Low, who with the help of Malaysia’s prime minister, some ruthless Goldman Sachs bankers, and a large number of other knowing and unknowing enablers, managed to steal and spend over 5 billion US Dollars from a sovereign wealth fund he himself set up. The story starts in 1998, when the 16 year old Jho Low, who stems from a wealthy Malaysian family of traders, arrived at Harrow, an elite boarding school in England. It was here and later at Wharton business school in Pennsylvania, where he met many of the connections, particularly from the Middle East, that later enabled him to execute his scheme. In 2009 Jho Low helped to set up the sovereign wealth fund 1Malaysia Development Berhad (1MDB) using his relationship with then Deputy Prime Minister (and soon thereafter Prime Minister) Najib Razak.
With the help of his contacts in the Middle East he set up a partnership deal with a Saudi oil company, that enabled him to transfer $700 million into an account which he had full control over and from which he could spend money without any oversight. And spend he did, seemingly without any restraint. He threw parties for tens of millions of dollars all over the world, many of which included celebrities like Leonardo DiCaprio, Paris Hilton, Alicia Keys and many others. At the same time he spent millions on jewelry for Najib Razak’s wife to keep the Prime Minister on his side. Over the course of the next few years he managed to first raise (through bond sales arranged by Goldman Sachs) and then siphon off (with the help of various shady characters in Britain, Saudi Arabia and Singapore) several billion dollars. His spending went completely insane, and included items like Basquiat’s masterpiece “Dustheads” for $48 million, a superyacht for $250 million and the $100 million financing of the movie ‘The Wolf of Wall Street’.
The whole scheme started to unravel at the end of 2014, basically because the fund just ran out of money, and Jho Low started to have trouble paying his bills. In 2015 the story became frontpage news all over the world, after the Wall Street Journal received a trove of leaked document related to the fraud.
More damning than what this story says about the people involved, is what it reveals about a legal and financial system and the culture, that made something like that possible. It is astounding to realize how many people all across the world either were directly complicit, or deliberately looked away only because they themselves were richly rewarded. The blatant and audacious brazenness of the scheme, seemed to have been one reason why it worked. Nobody would believe that anybody could be capable of such a heist.
The shocking result of all of this is, that almost no one is in jail for it. So far only Najib Razak was sentenced to 12 years in prison. Goldman Sachs was recently ordered to pay back 3.9 billion to Malaysia. The main banker responsible, Tim Leissner, settled with the SEC, was fined and banned from the securities industry, but he did not receive any jail time and surely enjoys his millions somewhere in the world right now. Although arrest warrants are outstanding on Jho Low in Malaysia, Singapore and the US, he is reported to live a life of freedom and luxury in mainland China and Macau.
In some ways this story of psychopaths reminded me of the book “Bad Blood” about Elizabeth Holmes and Theranos, except this seemed much crazier and more outlandish, and inhabited by much more colorful characters. It’s a very well written, entertaining and fast-paced story, that reads more like crime thriller, then a non-fiction book.
3) The Children of Ash and Elm — Neil Price
(Basic Books, 2020)
This is a complete history of the age of the Vikings. I thought this was a fantastic book — scholarly in its breadth and detail, yet very easy to read. The book does a beautiful job in recreating the Viking World in vivid images and I learned a lot about this period. It gives you a great appreciation for the richness of Viking world, its customs and believes, and its heterogeneity and the tolerance for others, without minimizing the absolute horror and violence that was inflicted on the victims of the frequent Viking raids all over Northern Europe.
There is no exact beginning and end of the age of the Vikings, but it is generally considered to encompass the 250 year period from the 750s to around the year 1000. In the west the beginning of the Viking era can be pinpointed to 793 AD, the year of the first Viking raid of the monastery on the island of Lindisfarne in the north-east of England. But Viking expansion into the Baltic region started somewhat earlier.
The origins of the changes in Scandinavian society lie a couple of centuries earlier, when one or probably two great disasters occurred in the years 536 and 539, that caused a significant reduction in the population and a near total collapse of the farming societies in Northern Europe. The likely cause for this massive disruption were one or two huge volcanic eruptions that would have caused a nuclear winter for months or even years. The 539 eruption of Llopango in El Salvador is the most likely culprit, but there is no scientific consensus on this, and a number of other volcanoes or even meteorite impacts are being considered.
The Vikings had no written contemporary history. Much of what we know about the them came from Icelandic sagas, the earliest of which were written in the 11th century. There are a number of written eyewitness accounts by outsiders, mainly by visitors from the Arab empire or from descriptions of people in the west, who were victims of raids. Although the Vikings had no written history as such, they had a written language, but it seems to have only been used on rune stones, which were placed to commemorate the dead. But newer archeological finds, particularly those of very elaborate boat burials, have significantly updated and changed the picture.
The book goes into great detail, how the world of gods, Valkyries, elves and dwarfs was just as real and important in the lives of every Viking as was the visible world.
I learned how the Vikings that moved into Eastern Europe became the Rus, a population which later evolved in Russians. This has only recently been more widely acknowledged as Russian patriotism in the past liked to emphasize the Slavic origin of the Russian people, when in fact their true origin may lie in Scandinavia.
I also learned about the important part slavery played in Viking society (mirroring a similar theme in Peter Frankopan’s book). Many of the frequent raids across all of Northern Europe may have been to a large degree driven by the desire to gather human slaves, which were either used domestically in Scandinavia or being sold to slave traders from the Arab empire. These slaves were likely subject to horrifically brutal treatment.
To me the most astonishing part of the story of the Vikings, was how far they managed to travel and extend their influence. They were the first people to discover and settle Iceland and Greenland. Viking long boats reached North America in the 10th century and even though they probably never established permanent settlements there, they were a frequent presence in Newfoundland and interacted with the native people there. In the other direction Viking traders regularly traveled all the way south and east to the great cities of Constantinople and Baghdad, and some may have even reached Tang dynasty China. It is fascinating to imagine the stories one of these travelers would have brought back with him when he returned home to his farm next to a remote Norwegian fjord.
I was particularly fascinated by the life of a woman named Gudríd Thorbjarnardóttir, who was born in Iceland around the year 980 and later moved with her husband to Greenland. She was on one of the first boats that reached Newfoundland while pregnant, and she gave birth there to the first European child born on American soil. A few years later she went on a pilgrimage all the way to Italy, where she is believed to have met the pope, and finished her life as a Christian nun on Iceland. She was quite possibly the most widely traveled woman of her time and maybe the only person within the next 500 years who met native people in North America and the pope in Rome.
There was no specific event that marked the end of the Vikings. Instead it was a gradual transition around the early parts of the 11th century, which saw an end to the raids, that had terrorized large parts of Europe for more than two centuries, and a gradual shift towards nation states and monarchies in Scandinavia, which ended what we consider the age of the Vikings.
4. The Bridge — Thane Gustafson
(Harvard University Press, 2020)
I really did not expect that a book about the history of the natural gas market in Europe would be of that much interest to me. But after seeing the book mentioned as one of his top recommendations by Tyler Cowen on his website ‘Marginal Revolution’, I decided to give it a try. And I was very glad that I did. This is so much more than a story about natural gas and European energy politics. The book provides a rich history of the political, economic and commercial relationships between Europe, the Soviet Union and later Russia, starting in the 1950s up to the present day. It is one of those books that gave me a new appreciation for a subject I had never thought much about. The following are just a few snippets of the many things I learned from reading The Bridge.
Natural gas went from being considered a waste product of oil drilling, that was usually just flared off, to the most important fuel for power and heat generation in Europe. It was the discovery of the huge Groningen gas field in the Netherlands in 1959, which started the European natural gas market. Back in the 1960s natural gas was considered the clean energy fuel, as it burned without creating any toxic gases, and carbon dioxide wasn’t considered a problem back then. (Natural gas mostly consists of pure methane CH4, which produces only CO2 and H2O when burned.) The big problem with gas, unlike oil and coal, is that it cannot easily be stored, so it has to be continuously piped through pipelines straight from the producing fields to the end users. This required a huge amount of complicated infrastructure to be built before natural gas could be exploited. It involved an enormous effort and investments to construct the gas lines into every home, that we now take for granted, when turning on the gas stove to cook or when hot water comes out of the tap. For a long time natural gas used to be considered too scarce and valuable to be used for electricity generation. It was the technological leap of the combined cycle gas turbine plants in the 1980s, that made natural gas the preferred fuel for power plants.
The Soviet gas industry was started in the 1950s with natural gas from the Ukraine, but it really kicked off when truly gigantic gas fields were discovered in Western Siberia. The books goes into great detail how the development of these natural gas fields was driven by a few very effective bureaucrats, who believed in the promise of natural gas and who knew how to navigate the Soviet system. One man in particular, named Aleksey Kortunov, was probably single-handedly responsible for pushing forward the development of the gas in Western Siberia initially against the preferences of the Soviet leadership. Without his vision, tenacity and intimate knowledge of the inner workings of the Soviet bureaucracy, the Russian gas industry would have maybe taken decades longer to develop. Kortunov is an interesting example of how a single and tough-minded individual, through persuasion and the deft managing of the bureaucratic machinery, could set significant changes in motion even in an incredibly inefficient system like the Soviet Union.
The success of the Soviet — European gas connection, was also due to a series of pragmatic and commercially minded negotiators on both sides, who were able to ignore ideological differences and continued to negotiate even during the darkest hours of the Cold War, to come to reasonable agreements that benefited both sides. I think it is a great example of how shared economic interests usually trump even the sharpest ideological differences. The Soviet Union did not have the technological capabilities and the materials to build out their pipeline infrastructure. Thus, the contracts were structured in a way that the Soviet Union would ship gas to Europe essentially in exchange for steel pipes, compressors and technological know-how. The author considers the successful construction of the gas pipeline network to access the gas fields of Western Siberia, one of the most hostile and inaccessible landscapes on the globe, as one of the great engineering feats of the 20th century.
I particularly enjoyed the chapters on the creation of the European Union, the development of its single market, and the triumph of neoliberal economics, that originated in the 70s in the UK and the US and was wholeheartedly embraced by Brussels in the 1980s. I had not realized before how much the rules and structure of the single market were designed and driven (often against the wishes of Germany) by very capable officials from the UK (chiefly among them Lord Arthur Cockfield). It is a bit sad to contemplate what an important part Britain played in the creation of the EU single market, and which it now has decided to leave led by rather less capable politicians.
This neoliberal shift also lead to a liberalization of the natural gas markets in Europe, which traditionally were based on long term contracts and fixed prices. A large part in this development was played by DG Comp (short for Directorate-General for Competition of the European Commission), which became an incredibly powerful institution, that was run by a series of steely, smart and determined commissioners. (Margrethe Vestager is the most well known and recent of them.) The action of DG Comp against many energy companies, including an antitrust investigation against Gazprom that began in 2012, played a huge part in breaking up the cozy long term arrangements between gas suppliers, pipeline operators and utility companies that had lasted for decades. Russia and Gazprom appeared to be caught completely by surprise by this shift in the European energy markets.
While liberalization and competitive legislation has driven huge changes in how natural gas is sold and distributed in Europe, it is the environmental movement, particularly in Germany, that will likely drive the most significant changes in the energy sector going forward. The shift in the reputation of natural gas from a clean fuel to a major contributor of climate change, could become the largest threat to the Russian gas sector in the future.
Despite the frequently voiced concern that Europe is too dependent on Russian gas imports, and that Putin could use the threat of stopping gas exports as a tool of political pressure (as he has done repeatedly to Ukraine and other former Soviet republics), the author argues that this is unlikely to happen with Western Europe, given that Russia is very much dependent on the income from its gas exports. And furthermore over the last decade Europe has significantly reduced its dependence on Russian gas and broadened its possible sources particular in the form of LNG from countries like the US or Qatar.
I enjoyed this book much more than I had expected. I can highly recommend it to everyone, even if you’ve never had any interest in natural gas.
5. Algorithms to Live By — Brian Christian & Tom Griffiths
(Henry Holt and Co, 2016)
This was a really fun book to read. It is full of deep insights and manages to apply complex mathematical concepts and recent advances in computer science into everyday situations. The book is organized by the type of problems that algorithms are designed to tackle, things like sorting, caching and scheduling. The authors chronicle the history of these problems, explain the current state of the art in mathematics and computer science and demonstrate how these algorithms can applied not only in computer science but in many real world situations.
Stopping:
The goal of optimal stopping algorithms is to find the best possible time to stop doing a particular activity in order to maximize a particular outcome. This could be applied to a wide range of situations, such as, “How many candidates should you interview for a job, before hiring someone?”, “How long should you search for a car park?”, and even “How many dates should you go on before settling on a partner?”. The key question is “How long to search before you leap?”, and the surprisingly exact answer in all of those cases is 37%. The problem was originally known as the secretary problem. You have 100 candidates applying for the job of a secretary, you can only interview them consecutively, and you have to make the ‘hire or pass’ decision before you see the next candidate. Turns out that the optimal solution is: after interviewing 37 candidates, hire the next interviewee, who is better than all previous ones. There are obviously a wide variety of different constraints on these types of problems, but they all tend to have exactly provable optimal solutions.
Sorting
Algorithms often are classified by how fast their processing time grows with the number of items to be processed. This can range from constant time (processing time is independent of the number of items), to linear time (time grows linearly with the number of items), to quadratic time, exponential time and even to the ludicrously slow factorial time (time it takes to process N items is proportional to N! ). Most basic sorting algorithms run in quadratic time, meaning the time to sort grows by the square of the number of items to be sorted. This applies to algorithms such as the bubble sort, which is usually the worst, or the slightly better, but still quadratic, insertion sort. Unfortunately quadratic time algorithms can grow unwieldy very quickly when you deal with a large number of items. There are, however, sorting algorithms that can improve on quadratic time significantly, and they can get you somewhere between linear and quadratic time. Typically these are so called merge-sort algorithms, where you split a large number of items into much smaller groups, sort each of the groups individually and then merge the groups at the end.
Another insight provided in this chapter was that in many cases the best solution is not to sort at all. Given the enormous amount of time it takes to sort a large number of items, it is often more efficient to search instead of sort. Sorting something you don’t search often is a complete waste of time, while searching for something in an unsorted mess is merely inefficient. That is the approach I have used for my email inbox for years.
Caching
An enormous amount of work has been done in computer science in order to organize how data is stored in memory. This is crucially important in how computers function internally, as they have several different layers of memory. The trade-off in each type of memory is always between speed of access and size of memory - the larger the memory the longer it takes to retrieve data from it. (It turns out that the memory in human brains may be organized in a similar fashion.) Caching algorithms not only need to decide what data goes into which layer of memory and how long it stays there, but they also need to determine, once memory space fills up, which information to delete in order to free up space for new information (“forgetting is as important as remembering”).
Some of the results of optimal caching algorithms can be applied to everyday issues like organizing files. For someone like myself who tends to have papers piled up in a (seemingly) giant mess on his desk, this chapter provides vindication for my complete lack of a filing system. Turns out simply piling up documents in stacks is usually the optimal filing solution. It’s called the LRU (‘last recently used’) algorithm, where you keep the items that were used most recently on top and thus most easily accessible.
However, the most intriguing idea in this chapter was the theory that mental decline and slower processing speeds in brains of elderly people, may simply be a result of brains getting full. The more you know, and have saved in memory over the course of a lifetime, the harder it gets to access and find the information. Mental decline may be nothing more than the result of your brain memory chip getting full.
Scheduling
Scheduling turns out to be one of those very hard and largely unsolved problems. In fact many classes of scheduling problems have been proven to be intractable, which means no efficient algorithms can exist. Finding approximate solutions has been a huge focus in the design of computers, since processors work sequentially and thus need to constantly switch and prioritize between tasks. Most of these algorithms basically try to deal with the familiar problem of ‘most important versus most urgent’ and what to do first. One of the simplest algorithm is called ‘earliest due date’, another is the ‘shortest processing time’ algorithm, where you schedule things that can be done fastest first. There are various methods in between where you weight tasks by importance. But for everyone who struggles how to best schedule their list of tasks, it may be reassuring to know that it is in fact an intractable problem, and you may waste you time trying to find the best schedule.
Explore/Exploit
This chapter deals with the classic conundrum, whether to stick with what you have and what you know (exploit), or whether to go out into the unknown and look for something better (explore). This question has numerous applications in computer science, business and in everyday life. For instance, if you want to maximize your enjoyment of a nice meal, do you go to the your same favorite restaurant you know and like, or do you try out a new restaurant, which may turn out to be awful or could be even better? Computer science knows the answer, which is: “It depends on how much time you plan on going out to restaurants in the future”. Or in other words, the value of exploration (finding a new favorite) goes down over time, as the remaining opportunities to enjoy the new discovery dwindle.
This makes is reasonable and rational to be more risk seeking (i.e. explore) when you are young, and to be more conservative and set in your ways (i.e. exploit what you already have) when you get older. So, if you are a teenager or in your twenties and don’t understand why your grandparents have no interest in exploring new things and taking risks with new experiences, you need to understand that they are acting perfectly rational (in a mathematically provable way), just as you are when you are out seeking new adventures.
Game theory
Many games (like the famous prisoners’ dilemma) have a Nash equilibrium that is not the optimal case for everyone, and often it can be the worst case outcome. Badly designed games can lead to bad outcomes, even if every player in the game acts perfectly rational. This is an important mental model to remember, as sometimes terrible things happen, even if everyone acted reasonably and morally. I often thought that this applies perfectly to the 2008 financial crisis, and can explain why no one went to jail for it. It is possible that no one was at fault, but that the system was designed with bad incentives. Looking at complicated situations from a game theoretic perspective often allows you to change the rules of the game in a small way in order to create a new much improved Nash equilibrium.
Conclusion
In the conclusion the authors introduced a really interesting concept, which I am now trying to apply in my own life, and that is the notion of “computational kindness”. The idea is that in order to be kind you should try to minimize the computational burden on other people. Trying to be overly accommodating and flexible is not necessarily the nice and kind thing to do, when it means you leave the decisions to other people. For example, “I don’t mind where we go for dinner, it’s up to you.”, may sound polite, but it puts the burden of choosing the restaurant on the other person. For the same reason you may have noticed that people often are more likely to accept a meeting request, when you ask “Would you be available to meet next Monday at 10am?”, instead of “Can we meet sometime next week at a time of your convenience?”. The concept of computational kindness can also be applied to systems design. It is often better and kinder to give people less choice in order to minimize their computational burden. For example, building parking garages where the best strategy is to pick the first available space, or assigning people a table in the restaurant, instead of letting them pick any table. Maximizing choices for others is not always the optimal strategy.
