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

If you want to understand how finance affects the world, or how our current system came to be, this is a brilliant book that gives a wonderful account of the history of financial systems. In fact, I believe Mr. Ferguson makes a better historian than economist. The book is riveting when it is recounting the collapses of our economic past. But when he turns to using this history to prepare for the future, the wheels fall off.

Basically, if you want to know what this book prescribes for you to prepare for economic downturns, I'll sum it up: diversify! Shocking, I know. But, I don't want to poke too much fun at it. The history of insurance, bond markets, governmental borrowing and the profile of Chinese/American relations (he calls this Chimerica), were all very enlightening and will undoubtedly help me make wiser choices in the future. But, if you are looking for a book to help with your personal finance issues, this one is not designed for that. But if you want to know how we got to where we are, or the issues, trials and errors that got us here, then this is an awesome book.

On a rather odd note, I did notice that the author has a deep love for the work of Richard Dawkins. He used his concepts so many times that I thought he should be co-author. I found this very unusual and sad really. Why a world-class economist would use a tired, worn-out analogy as evolution is beyond me. In fact, in the last chapter of the book, Mr. Ferguson spends the majority of the time constructing the case that economics is like evolution. The craziest part of it is that the analogy does nothing to bring any clarity to finance. When one uses analogy, the hope is to build a bridge of understanding for the reader. In other words, use something familiar to bring something less familiar to light. Trying to follow Ferguson's evolution analogy brought no clarity and in fact seemed to muddy the waters. Not what one would expect from a Harvard professor.

But overall, I enjoyed this walk through the museum of finance. It gives us a greater understanding of today by brushing up against the past. While he doesn't give advice on how to recession-proof your portfolio, he does give much background to issues that you will find playing on your mind when you are deciding where to put your next investment.

Concise. Insightful. Gripping. Engaging. Well written in the King's English. Unbiased. And relevant.

What more could you ask for in a non-fiction work pertaining to the most intimidating topic of all for most? I read Ferguson's Empire and was not nearly as taken. I reluctantly picked this up at a friend's suggestion and could not put it down. He breaks complex financial events into undstandable narrative. He also ties the histories of the past to the crisis of today, and looks to what we should learn, and what we have no control over, in the future. A work of genius.

Money well spent.... for the record I used cash. Bravo Prof. Ferguson, I look forward to more.