Move over William Poundstone (author of "Prisoners Dilemma" and "Fortune's Formula"). John Allen Paulos (author of "A Mathematician Plays The Stock Market") can read this book and revise his own flawed works with this insight. Michael Lewis (author of "Liar's Poker") can stop typing now. There is a new king of lucidity concerning the nexus of games and game theory, mathematics, finance, gambling, markets, and the simultaneously brilliant and frail humans who engage and advance our knowledge of them all. His name is Aaron Brown.
Aaron Brown's "The Poker Face of Wall Street" accomplishes the impossible, for it is simultaneously a readable and enjoyable narrative work, yet also dense with mathematical and behavioral finance theory. Nearly every page supplies a lucid thumbnail explication of an economic or behavioral finance concept, backs it up with an appropriate example, often offers an alternative view, and then provides an historical anecdote to expand the concept and make it at once both memorable and familiar. Yet this is not a pedagogic work, but a popular offering for a wide audience of those who are curious or love poker, finance, or both.
Brown's method is to use the game of poker as his narrative spine, upon which he weaves the histories and intersections of finance and gambling, economics and risk, information theory and human behavior. He tells the tale of his own love affair with the game, going to the poker dens of 1970s Los Angeles long before there was a World Poker Tour or the Commerce Casino existed. These modest halls (often operating Veterans of Foreign Wars meeting halls) were an anomaly and a pause in history after the saloons of the wild west were tamed and before the leveraged glamour of Las Vegas lured the core tourist and casual poker player away. My own uncle spent his life in such places as a career poker player who made a modest living at the game, but often working ten and 12 hour days to do so, and with not infrequent setbacks. Yet, these nondescript low rise cinderblock buildings were the birthplace of poker as we know it today, and were where the world famous celebrity players of the hour originally honed their skills for today's high stakes televised games from the well of glamour.
Yet this is not simply a memoir of a poker great also-ran, but a sound examination on the dimensions of why the game is rational and irrational, tractable yet inexplicable, simultaneously transcendent and incarnational. Familiar poker personalities appear here and there, often emerging again in the work as other dimensions of their contribution to the game become more famous. But the work is not concerned with a recounting of great memories of a silent Cowboy facing a taciturn Chinese, both bluffing, and both betting all-in. Rather, it uses poker to point to gambling, gambling to point to math, and math to point to risk, and risk to point to investing, and investing to point to finance, and finance to point to economics, and economics to point to gambling. All concepts explained with examples and personalities.
Brown's elucidation of the gambling economy of the Mississippi delta Native Americans and how effective it was at distributing goods across vast territories in a moneyless society is the first treatment of the topic I have seen outside specialist historical texts, typically only known to Mississippi natives such as myself. The irony of a gambling economy trying to be supercharged by colonial economic presumptions, which were themselves being advanced by famous gambler John Law through his Mississippi Company, is a hilarious accident of history that Brown walks us through with deadpan seriousness. All the while pointing to goods and trade being advanced by gambling.
The short detail above is just one example of the countless dimensions that Brown has managed to weave into this work and provide its density. Well chosen history and anthropology buttress Brown's memories and economic and financial comments, yet in the same breath he points to gambling and poker. One puts this work down with the feeling that finally all previous works you have read concerning probability, finance, gambling, history, psychology, economics and mathematics have been tied together with a clarity never previously experienced or imagined possible. This is an excellent, satisfying work that merits immediate rereading. You will not be disappointed.
