Another year over, but before a new one begins it’s time to highlight some of the memorable titles that have appeared in The Capital Spectator’s weekly Book Bits column. Here are five economics/finance books from the 2015 archives that are worthy of a fresh look. Two additional recaps will follow over the next two weekends. Happy reading!

● Climate Shock: The Economic Consequences of a Hotter Planet
By Gernot Wagner & Martin L. Weitzman
Summary via publisher (Princeton University Press)
If you had a 10 percent chance of having a fatal car accident, you’d take necessary precautions. If your finances had a 10 percent chance of suffering a severe loss, you’d reevaluate your assets. So if we know the world is warming and there’s a 10 percent chance this might eventually lead to a catastrophe beyond anything we could imagine, why aren’t we doing more about climate change right now? We insure our lives against an uncertain future–why not our planet?

● Market Madness: A Century of Oil Panics, Crises, and Crashes
By Blake C. Clayton
Summary via publisher (Oxford University Press)
The culmination of a multi-year study, he shows how generational fears about an imminent, irreversible shortage of oil punctuate the history of oil since its earliest days. He explores the conditions in which oil supply fears arise, gain popularity, and eventually wane, and shows how important such stories can be in affecting financial markets. He links these episodes to the behavioral concept of irrational exuberance and new era economic thinking, first popularized by Nobel Laureate Yale economist Robert Shiller, to show how unfounded pessimism affects the market for oil and other exhaustible resources. Acknowledging the significant geological and structural changes the oil market has undergone over the last century, the book does not dismiss today’s shortage fears out of hand, but asks what they reveal about how commodity markets function and what that means for investors and public officials.

● Mind Change: How Digital Technologies Are Leaving Their Mark on Our Brains
By Susan Greenfield
Review via The Washington Post
In “Mind Change,” neuroscientist, entrepreneur and British politician Susan Greenfield argues that our technologies are not only addictive — they are an existential threat. The brain, she writes, has an “evolutionary mandate to adapt to its environment,” and the digital world is changing at too rapid a pace for individuals or government regulations to keep up. Lives are destroyed. The extreme is the Korean couple whose compulsive video gaming led to the starvation of their newborn. But the warnings are no less ominous among billions of moderate users: a dramatic loss of empathy over the past decade and a precipitous decline in outdoor activity among children.

● Global Asset Allocation: A Survey of the World’s Top Asset Allocation Strategies
By Meb Faber
Summary via Amazon
With all of our focus on assets – and how much and when to allocate them – are we missing the bigger picture? Our book begins by reviewing the historical performance record of popular assets like stocks, bonds, and cash. We look at the impact inflation has on our money. We then start to examine how diversification through combining assets, in this case a simple stock and bond mix, works to mitigate the extreme drawdowns of risky asset classes. But we go beyond a limited stock/bond portfolio to consider a more global allocation that also takes into account real assets. We track 13 assets and their returns since 1973, with particular attention to a number of well-known portfolios, like Ray Dalio’s All Weather portfolio, the Endowment portfolio, Warren Buffett’s suggestion, and others. And what we find is that, with a few notable exceptions, many of the allocations have similar exposures.

● What’s Your Future Worth?: Using Present Value to Make Better Decisions
By Peter Neuwirth
Excerpt via publisher (Berrett-Koehler)
Almost all of us imagine the future impact of the choices we make, but what distinguishes the actuarial perspective from the way people normally make decisions is that by using Present Value we can think about our choices in a systematic way that takes into account some aspects of the future that we rarely consider. In particular, when we use Present Value we try to imagine not just what we think the future impact of our choices will be, but rather consider all the possible futures each choice might lead to. And even more important than considering all the future consequences that a given choice might lead to, we consider when those future consequences might show themselves.
In summary, using the actuarial perspective means thinking about the future in a systematic way and using the idea of Present Value—the value today of something that might happen in the future—to make better choices.