“The Ascent of Money: A Financial History of the World” is a non-fiction analysis of the history of money, banking, and the rise of financial systems by Niall Ferguson, a British historian and professor at Harvard University. In his book, Ferguson makes the argument that finance is at the root of all human progress and that a lack of financial systems results in a failed society, using the gold-rich Spanish Empire of the 16th century as an example. As well, he argues that all historical events, whether they are political, social, economic or otherwise, are deeply grounded in the global financial systems.
Ferguson also tries to draw a parallel between financial systems and biological systems, making the claim that evolution and Darwinism apply to finance. He says, “Financial history is essentially the result of institutional mutation and natural selection. ” With these arguments, Ferguson explains candidly how finance has influenced past historical events. He reveals why Argentina went from being the world’s 6th richest country to an “inflation-ridden basket case”, how the French Revolution was started because of a stock market bubble, and how China is emerging from poverty into a global superpower in a single generation.
Ferguson has crafted a well-written piece on the financial history of the world and why it is important to society. Ferguson effectively proves through historical example and sound reasoning that finance is at the root of all human progress and is essential to the development of civilizations. Ferguson’s study of the financial history of the world touches on a number of Theory of Knowledge areas of knowledge. He touches on history, ethics, natural sciences, and, most importantly, human sciences including economics.
In examining the financial history of the world, Ferguson draws attention to the positive relationship between the growth and development of civilizations and the strengths and success of their financial and economic systems. Essentially, money is the reason for development in modern societies. These financial systems have allowed for quicker transactions, loans, and investments. Using such examples as the colonization of South America, Roosevelt’s New Deal, and the rise of China, Ferguson successfully argues this point.
Drawing from a wide variety of examples, Ferguson effectively shows the reader that the correlation between the growth of financial systems and the growth of civilizations is not just a coincidence but a trend throughout history. In this way, Ferguson effectively uses history, an area of knowledge, to support his reasoning that finance is at the root of all human progress. His arguments are also effective because they use sound logic, are not terribly provocative, and therefore seem very reasonable to the reader. This is most likely because we live in a society that is heavily influenced by finance and money.
The economy greatly affects our everyday life, something made increasingly evident in the current recession, where people are unable to maintain their old lifestyles of excessive spending. People are constantly trying to further their economic goals. As Ferguson puts it, “Bread, cash, dosh, dough, loot, lucre, moolah, readies, the wherewithal: call it what you like, money matters”. Ferguson’s arguments are so reasonable and true that they are easily proved through evidence from a wide range of countries and empires from the past.
