Historian Niall Ferguson is a widely published author. I enjoy some of his works and abhor others. But he never fails to provoke one to think critically and examine things in a novel way. This week I showed my high school Economics students The Ascent of Money. In this acclaimed BBC documentary series Ferguson presents the case that finance is the foundation of human progress. What’s more, he reveals financial history as the essential backstory behind all history. From ancient Mesopotamia to the Medici, the Rothschilds to George Soros, from the murderer John Law and the Mississippi Bubble to central bankster Alan Greenspan and the lead-up to 2008 Meltdown, Ferguson ties it all together in a fascinating epic story. The segments on the Rothschilds are particularly illuminating for Ferguson is the author of a definitive two volume history of that illustrious financial dynasty. In these segments you will gain a new revisionist insight into post-Napoleonic European finance and Lincoln’s “War to Prevent Southern Independence” and why the Confederacy was ultimately wrecked on the financial shoals of New Orleans.
Discover how has central banking fueled the rise of the welfare-warfare State. (Yes, Ferguson actually uses that phrase coined by Murray Rothbard). If war is the health of the State, then the interlocking nexus between elite central banks and the bond market has provided the propellant for this acceleration of statism over recent centuries.
In the process Ferguson elucidates key financial institutions and concepts by showing where they came from. What is money? What do banks do? What’s the difference between a stock and a bond? Why buy insurance or real estate? What is the difference between prime and sub-prime loan instruments? What are derivatives and securitization? And what exactly does a hedge fund do?
Perhaps most important, The Ascent of Money documents how a new financial revolution is propelling the world’s biggest countries, India and China, from poverty to wealth in the space of a single generation — an economic transformation unprecedented in human history.
Yet the central lesson of the financial history is that sooner or later every bubble bursts — sooner or later the bearish sellers outnumber the bullish buyers, sooner or later greed flips into fear. And that’s why, whether you’re scraping by or rolling in it, there’s never been a better time to understand the ascent of money.
10:26 pm on April 25, 2014
