The Ascent of Money: A Financial History of the World by Niall Ferguson

Currency has been used as a form of payment for centuries having been formally created in the fifteenth century in Renaissance Italy, under the influence of the Medici family who helped to create the first bank. Therefore, the birth of modern finance can be accredited to the Medici family of Renaissance Italy. However, one ought to know how transactions and payments were made prior to the invention of money, as we know it today.

Currency, as has been demonstrated in the past, is only worth what someone else is willing to give to you for it. The most illustrious example was the Incan Empire where this civilisation had vast quantities of gold and silver, yet they were valued as worthless. Instead labour was often measured as currency. However, some ancient civilisations such as the Mesopotamians had a Barter Economy. This means that instead of using currency to ‘purchase’ goods or services one would like, a trade was completed. This means a trade was offered in terms of goods or in services for the other.

This simply demonstrated how currency is greatly valued today, yet throughout human history currency was hardly used. Many civilisations have come and gone who have used currency or have not. One example of an ancient civilisation that used currency were the Romans, who did in fact have a stable currency, with which their markets operated. Although, most other civilisations did not value money greatly and instead used other methods to suffice payments or transactions.

Money has now been used for centuries and often seen as depended upon by many powerful nations across the world. However, in recent history money has also been criticised by many different people. This is most apparent with the beliefs of Communism, which states that money is a tool of capitalist exploitation and should be eradicated. Although, the remaining communist countries such as North Korea have still failed to remove their currency, which simply highlights the dependence our modern civilisations have acquired. Furthermore, even John Maynard Keynes one of the greatest British economists, dismissed the Gold Standard in 1924. The Gold Standard is the form in which currency is measured in the UK, which makes money equivalent to gold in banks.

To conclude, this short book clearly summarises the history of currency and the problems associated with the dependence on money. Ferguson has created an excellent book that provokes much thought and questions the fundamentals of the civilisations that we have created.