Five Must-Reads for Understanding This Market

MILLBURN, N.J. (TheStreet) -- Two years ago, I presented an article called "20 Essentials for Achieving Financial Literacy," in which I offered a list of subjects and books that any student of finance or economics should study and read. With teachers and students getting back into the swing of a new school year, I thought I'd revisit that list and suggest some additional readings

I hope that this list of textbooks and literature from my own bookshelves will help augment your knowledge and appreciation of the world of finance and economics.

Corporate Financial Distress and Bankruptcy by Edward I. Altman and Edith Hotchkiss

I had the honor of taking a class with Altman when I was enrolled in the MBA program at NYU. This is the most up-to-date version of his groundbreaking work on bankruptcy, in which he introduced the concept of the Z-Score, a predictive measure of bankruptcy. In this edition of his book, the Z-Score is discussed in Chapter 11: "Corporate Credit Scoring --Insolvency Risk Models." The Z-Score was instrumental in predicting the bankruptcy of several companies, including General Motors, Sharper Image, Circuit City and Six Flags. Anyone interested in utilizing the Z-Score can do so with this calculator I developed.

An Inquiry into the Nature and Causes of The Wealth of Nations by Adam Smith

This lengthy treatise, written by the Scottish philosopher and founder of the classical school of economic thought, was published in 1776 at the time of the American Revolution. Smith espouses the pursuit of self-interest and discusses the concept of the "invisible hand," which guides the production of products for the benefit of personal gain.