Books like The Great Depression: A Diary

I suspect there are few people who will love this book as much as I did. It is essentially a financial affairs diary kept by an attorney living in Youngstown, Ohio during the Great Depression. As an attorney with a thirsty interest in investment theory and an indecent obsession with all things Great Depression, this book was really right up my alley.What made this book remarkable was the author's uncanny insight into investment theory. Over the course of a single decade -- the 1930's -- he singlehandedly developed the same theories it has taken professional financial analysts and economists decades to figure out. Quite simply, he *learned* from his (and his clients') experience of living through the great depression and determined the most advantageous ways to invest through high highs and low lows of the economic cycle. I was fascinated to watch his really very simple theories unfold as he observed and evaluated what was happening around him. His bits of wisdom included:1) People grow their wealth by buying assets when they are CHEAP, not soaring. 2) Therefore, everyone should keep 40-50% of their assets *liquid* (meaning in investment grade bonds or treasuries) and the rest of their wealth in high-quality stocks (for us, think index funds, like S&P 500 index). 3) By keeping some assets liquid, you put yourself in a position that allows you to buy stocks when they are cheap.4) Stocks will always crash. When stocks crash, bonds soar. When stocks crash, sell some bonds and buy stocks, then hold onto them no matter what.5) Likewise, when stocks are soaring, bonds are usually dirt cheap. Therefore, when the stock market is setting record highs you should be buying more bonds and fewer stocks. This way, you are always buying assets when they are on sale. This is key.The author repeatedly lamented that in 1929 people who were invested in the stock market were 100% invested in the stock market -- no one held cash or bonds. Therefore, when the market crashed they lost EVERYTHING. If people had held bonds/cash during the time of the crash, they could have had cash available to buy stocks when they were dirt cheap. The author mentioned a few people he spoke with who did exactly this and basically never had to work again. But it takes enormous patience, levelheadedness, and discipline.The author also struggled with how to "time" the market. How do we know when it is going to turn? When to buy stocks vs. bonds? Today we know that this problem can be elegantly solved by sticking to a decided and set asset allocation (for instance, "own your age in bonds". If you're 40 years old, own 40% bonds, etc). So, say you own 60% stocks and 40% bonds. The stock market crashes. Stocks go down and bonds go up. Now your portfolio is 60% bonds and 40% stocks. Excellent! Stocks are on sale! Time to rebalance your portfolio by selling bonds and buying stocks so that you reach your 60% stock / 40% bond allocation again. And voila! -- you just bought stocks on sale merely by rebalancing your portfolio. We now know that if you do this rebalancing quarterly, you will do very well indeed. I only wish I could have given the author this missing piece of his puzzle. He had literally everything else figured out on his own.A fabulous read.