Wealth, War and Wisdom

Biggs, who ran research and then strategy at Morgan Stanley before starting a hedge fund, went back through the equity markets of the Second World War to test whether prices recognised the turning points as they happened. His finding is that they largely did: British stocks bottomed around the summer of 1940 and turned before the invasion threat visibly lifted, the American market turned in 1942 near Midway, the German market peaked as the Eastern Front did. The second half of the book is the practical consequence — how families actually preserved wealth through occupation, inflation, confiscation and currency destruction, and why land, businesses and diversification across jurisdictions survived while paper claims on a defeated state did not.

Why it’s on the list: The value-investing section is not only about how to value a business; it is about what capitalism does under stress. This is the wealth-preservation case taken to the limit, where the question stops being returns and becomes survival.

Where I saw it: On Li Lu’s Recommended Book List, the Himalaya Capital bibliography — 137 entries across six numbered sections. This entry sits in the value-investing section, the one the saved X posts photographed; the full list was recovered from the source PDF. Li Lu lists it as Wiley, 2008.

Connections

• Li Lu’s Recommended Book List — the list this came from.
• World War II — the period whose markets the book reads as a signal.
• Morgan Stanley — where Biggs spent the career behind the argument.
• Market Cycles — the claim that prices anticipate rather than report.