Book Review - The Ascent of Money

The Ascent of Money is a brief history of some of the key moments in the development of the business of finance as we currently know it. The author is academic Niall Ferguson.

Ferguson's central theme running through the book is that finance was a key driver of at least a number of key developments and events in human history. In his own words:

"poverty is not the result of rapacious financiers exploiting the poor. It has much more to do with the lack of financial institutions, with the absence of banks, not their presence"

I very much agree with this proposition (but, for all practical purposes, he was preaching to the already converted when I picked up the book).

Ferguson's writing style is pleasant to read and sufficiently lively to make his account of the selected samples of history engaging. It took me about three days to read the book while I was on holiday.

As a whole I enjoyed the read and thought it was an excellent and well presented work on the subject.

However, I do have a few minor quibbles. The first is that, as someone who was already familiar with the subject matter, I would have enjoyed more detail and....well just more. It was very readable. Fortunately, there is a comprehensive list of source material in the book.

The second issue is that while the book is understandably focused on the causes and effects of financial crisis, I felt that insufficient attention was given to the role of politicians, regulators and governments generally in creating or facilitating the conditions in which financial disasters occurred.

The last point is that his attribution to the economic downturn which Hong Kong experienced beginning in 1997 to the resumption of PRC sovereignty over Hong Kong is simply wrong. The Asian crisis and an administrative decision to hugely inflate the supply of land for housing were two of the main factors which caused and exacerbated the downturn. Having lived through the experience, I saw nothing to suggest that changing the flags over government house had any bearing on the economic events at the time in the manner suggested.

Overall a great read and an important point which is well worth remembering when we consider how our financial lives should be regulated.