Money by David McWilliams

Reviewed by E.B. Heath

Money, like faith, is a product of the human imagination.

David McWilliams

In his latest book, Money, David McWilliams advances the theory that the invention of money and consequent financial innovations have caused technological and social progress.  He guides readers from the Ishango Bone to cryptocurrency, to make his point that money really does make the world go around. Although, innovations around fire and the wheel came to mind, perhaps ranking equal place.  But McWilliams, like many of his literary countrymen, is an articulate witty communicator; it’s easy to be swept up by his amusing anecdotes of human ingenuity and fragility in the company of money.

David McWilliams’ career as a monetary economist began in The Central Bank of Ireland.  But he is at odds with his fellow economists, who, he writes, have taken all the fun out of money. A highly emotional substance, money can be transgressive, sexy, dangerous, mind-altering. This is not a dry economic discourse.

The initial chapters detail ancient money evolving to contracts and coins, to the Greeks and Romans and the ‘The Empire of Credit’.  All quite interesting, but then McWilliams introduces some off-beat historical facts in ‘Medieval Money’, that takes readers from the feudal economy to God’s Printer, namely, Johannes Gutenberg.

Gutenberg has certainly been sanitised by the history books.  Bit of a sketchy character to say the least.  Constantly skating on financial thin ice, his life as told by McWilliams is a mini-series in the making.  Gutenberg gave the world the printing press, a precious gift, but what was his motivation.  Good comes out of bad!  Famous for making the Bible accessible to all and sundry, he was actually chasing a pile of money to be made from indulgences, a religious scam of the time.  Medieval money also covers how the Arab merchants ran rings around western traders using a superior knowledge of mathematics.  Employing the concept of zero they could count in large numbers, to conceive of balance sheets with positive and negative numbers, and to use the tool of algebra.  While everyone else was still using the abacus the Arabs displayed extraordinary mental agility.  The Europeans were dealing with money.  The Arabs were dealing with finance.  Here we meet Leonardo of Pisa, better known as Fibonacci.  Under Arab tutors, he learnt about inductive analysis and went on to change the face of European mathematics.  This in itself led to an upsurge of wealth.  Gripping stuff in the hands of McWilliams.

McWilliams fast-paced witty prose takes readers through the centuries, linking democracy to wealth and economic power.

Explanations of unhooking from the gold standard and fiat money (described as a fragile system and a great illusion) were most interesting.  Although I wondered what the Chinese were up to in this era, and, for that matter, all the other eras discussed.  Apart from Chinese use of paper money long before Europe, China is not discussed.

What McWilliams thinks about cryptocurrencies is detailed in the last few chapters. A fearful monetary concept for some of us.  He defines them as private currencies.  As opposed to public currencies fulfilling the function of money as a store of value and having the advantage of being backed by governments.  Cryptocurrencies, he writes, are a mechanism to enrich a few, particularly their creators.  Although, Mr. Donald Trump campaigned on the promise to make America the crypto capital of the planet, and even a bitcoin superpower.  And, since becoming president has withdrawn a rule that requires banks to treat cryptocurrencies as a liability on balance sheets.  We live in interesting times, personally I could do with a little less uncertainty in this space.

Money is an ambitious historical tour de force charting the relationship between us and money.  From clay tablets, coins, to the French Revolution, from the power of the US dollar to cryptocurrency, humans are constantly shaping the world via money.  And, as McWilliams suggests it is now shaping us.

Recommended

Money

by David McWilliams

(2024)

Simon & Schuster

ISBN. 9781471 195440

$36.99 Paperback; 400pp

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