The Inflation Myth and the Wonderful World of Inflation is authored by Mark Mobius; a founder of Mobius Capital Partners; an investment manager for emerging markets and frontier markets.
Mark uses the 200 pages in this title to present a positive case for dovishness. The Inflation Myth seeks to challenge policy makers who view high inflation as a justification to ratchet up interest rates and stall the economy.
He argues that in fact, when all things are considered, the cost of many goods is actually decreasing in real terms (that is, relative to incomes) despite what inflation statistics published by the ONS might report.
Being only 200 pages long, and printed with a comfortably sized typeface, this was a relatively quick read. It took me about 4 hours to read it from cover-to-cover. Certainly a book which would be consumed at your leisure over the course of a single weekend, or across two weeks of bitesize reading sessions before bed.
Review of the Inflation Myth book
Financial Expert Rating: 1.5/5
As indicated by the low score, I was disappointed by this title.
Let me caveat this score: I don’t consider myself a literary critic in any sense of the phrase. I would give no more weight to my own words than any other independent and thoughtful review you would find on Amazon or similar.
I would rather write a hundred positive reviews than one negative review, however I felt like I would be compromising the integrity of the site and its best management book lists if I didn’t also publish reviews for titles which underwhelmed me.
If you’re still interested, here is my summary of where I thought the Inflation Myth stumbled.
- Conflicting messages
Many chapters would open with a barrage of quotes. These often ran on for 3-4 pages and would offer different opinions on a specific question of inflation. Such as: what causes inflation?
My issue with this format is that after several pages of quotes, the reader has been offered almost every possible answer to the question. However the author didn’t take a strong view on the matter at hand. So having being exposed to conflicting opinions on a matter; tossing the issue truly up in the air… it then just lands in a vacuum. The reader is left somewhat confused as to what conclusion the author wanted us to reach.
When I pick up any book other than an encyclopaedia, I want the author to take me through a curated journey of facts, anecdotes and reasoning and be brought to a conclusion. Introducing conflicting opinions, when done well, allows the author to raise counter-points and dismiss competing claims, which adds value to the case being made.
The only consistent idea that I was taking away from these sections was that many big thinkers on the topic disagree with one another. In my opinion, this writing device served to fill pages but it reduced the credibility of all ideas tabled.
2. An unclear central argument without momentum
Reaching the halfway point through the Inflation Myth, I was struck by the realisation that I didn’t understand what the book title was referring to. What was the myth? I don’t recall the word myth actually being used in the book. In hindsight I still struggle to attach it to a single doctrine or school of thought that the author intended to counter.
Overall, the title seemed to be absent of a specific call to action, or recurring message being repeated and strengthened throughout. Many pages were spent explaining how difficult it is to measure inflation, and how inflation figures have been falsified in the past.
But where did that point lead? Having dedicated a good portion of the book to case studies which support the fact that inflation is a nightmare to measure, this hard-won ground wasn’t leveraged to drive a conclusion.
I sit here nodding in full agreement that inflation is hard to measure. But the unanswered question ringing in my head is; ‘but so what?’
I found myself beginning the final chapter with a clearer idea of what the author didn’t believe, than what he believed.
Momentum was also sapped by the authors occasional habit of undermining a chapter’s topic at its very end. To invest time learning about a topic and then read a critical piece of evaluation at the very end, took away from what I had just read. Did that chapter contain the secret to the myth, or was it just a short destination on the way to a broader message?
The author jauntily critiques a quote about Bitcoin doing away with the need to trust intermediaries: “The paper failed to point out that faith in encryption is necessary!”.
By equating these two concepts: trust in bank employees and trust in the mathematics of encryption, the author reveals that they have not performed enough research into Bitcoin to appreciate the mind-bogglingly secure cryptography techniques used. If they had, they may have appreciated the difference between reliance on encryption as a technology, and the reliance upon bank employees to make ethical decisions in spite of well documented agency issues, conflicts of interest, and two decades littered with scandal.
Read more: The best cryptocurrency books
3. Proof-reading issues
The number of editing or proof reading issues in this text was frankly quite distracting. In the foreword, the author states that the manuscript was handed to the publisher during the onset of covid, so I can begin to understand how errors crept into print.
I was provided this book as a review copy by the publisher, so I hesitated before mentioning these points in case I was given a proofing copy. However, a recent review on Amazon made the same point, so I feel more confident that these issues are in the editions being sold.
Examples included a few instances of sentences reappearing, word-for-word, sometimes only a page apart. One section heading didn’t correspond to the content it introduced, and I caught a typo in a date (unless computers in fact did exist in 1900).
Ultimately these types of issues will never make or break the best business books, but in this case it was just another bug bear to add to the pile unfortunately.
Final thoughts
Overall, the strength of this book is in the number and the quality of case studies from around the world. Many of the most interesting cases surrounded hyperinflation.
The sections on hyperinflation underline the fact that inflation is very far from being a myth, and is a very real phenomenon that carries a human cost.
You might be wondering if this might run contrary to the theme of the book. I don’t think you’re wrong there, but it was engrossing nevertheless to see how governments failed time and time again to take the right decisions to protect their citizens from financial catastrophe.
Other books covering the same topics as The Inflation Myth
If you’re new to money and markets, you should start with the best economics books, to give a good grounding in how concepts like inflation, money supply and consumption are connected.
To focus on currencies, you could read books about forex trading to understand how valuation changes in currencies can translate into financial gains and losses for traders.