John Kay

If you want a book on economics to take to the beach, you are spoiled for choice at the airport bookstall. What you will find falls into three categories: Thump books, microeconomics books with little economics and the macroeconomic story-teller.

If you want to understand how the City came to play such a central role in British economic and political life, why a crash was inevitable, and why the crisis is being resolved on terms which give so much and ask so little of the financial sector, this is the most important thing you need to understand: the influence of investment banks on modern politics and policy.

Our leaders blog, twitter and consult focus groups. But these developments do not make society better governed.

The Whiz Kids’ capacity for analysis far exceeded their knowledge of the world to which it was applied.

Three simple rules – pay less, diversify more, and be contrarian – will serve almost everyone well who invests.

Think probabilities and be detached. It’s hard advice to follow. That is why the financial services industry is better off than its customers.

In practice, the only successful method of reducing public spending as a share of GDP has been to impose tight curbs while the economy is growing rapidly. We shall be lucky if such an opportunity appears.

The return on your portfolio is the aggregate of the returns on individual securities: the risk on your portfolio is not the aggregate of the risk of individual securities. With the aid of diversification you can earn more return with less risk.

A licence-fee-based BBC was the guarantor of quality television in a monopoly market. But a licence-fee-based BBC is now the main obstacle to quality television in a competitive market.

Having seen off the taxman, you must see off the sharks of the financial services industry.