In an interview on Understanding High Finance

You chose these books because they help the layman to understand economics.

Yes - there is a kind of ‘two cultures’ issue between the general literate public and the world of economics. It’s possible, for example, to be a functioning competent, literate, well-educated adult and not know what a bond is. If you listen to people very casually saying, ‘Well, the thing about the interest rate is …’, just those two words - ‘interest rate’ - imply a set of quite complicated linked ideas about the impact on business, the impact on the cost of borrowing, economic growth, employment, house prices, and exchange rates. No one is born knowing that. I think the standard of writing in the world of economics and money is high, but pretty much everything is addressed at people who already ‘speak’ money. It’s very unlike, say, popular science: where the books do walk you through the basics, until the point that you cease being unable to understand, for example, quantum mechanics in the comfort and safety of your own home. There’s a level of discourse about money that’s really interesting, but it does assume you have that competence, and it’s quite striking how few books there are that properly address the general reader. 

Tell me about The Money Game by Adam Smith.

Adam Smith is a pseudonym – he was an extremely successful professional investor called George Goodman, who also wrote a newspaper column. This is a real insider’s account of the way that the money markets and trading works. And the most helpful way of understanding it is as a sort of a game: taken dead seriously, but contentless, in the way that games are. He talks about Keynes’s idea of how investment is intolerably boring to anyone who lacks a gambling trait in their character. It’s very funny, very fluent, very well-written and also a real pro’s view. I don't know why it isn’t famous any more. The first section is called You: Identity, Anxiety, Money, and it’s very good on the way that money touches on things about anxiety. In a way it’s a reassuring book, because it tells you that the ways that the professionals are conflicted and confused actually pretty much exactly mirrors the way that the rest of us are. The professionals have more tools, but they have the same underlying complexities and ambiguities and ambivalences. George Goodman also wrote a very interesting book about counterculture, about transcendental meditation and yoga and so on: he has an unusually wide-ranging mind and set of interests. 

Why did he write this book?

I think he also felt what I was talking about: that there was this sort of gap, that there wasn’t this kind of writing directed at the lay reader and that there should be. It’s so important that people should understand. It’s very obvious now after the blow-up, but this thing goes very deep in terms of how modern society works. There’s also a larger point, I think, which is that democracy implies an informed electorate.