Bread, cash, money, liquidity, bucks, dough, black money, available funds, means of living: however you call it, money counts. For Christians, the love of it is the root of all evil. For generals, it is the means of conducting war; for revolutionaries, it is the shackles of labor. But what exactly is money, where did it come from, and how did we end up living in a world where most money is invisible? The first step to understanding the complexity of modern financial institutions is to ascertain their origins - something this unique introduction to economics and economic history offers. Recognizing the spread of money as a driving force of modern history, the renowned economist Niall Ferguson unfolds a series of fascinating scenarios where the Medicis, the Rothschilds, the Bank of England, the Paris stock exchange, insurance companies, and Wall Street have contributed in their own way to elevate the historical significance of liquid money into the stratosphere - where it is not just a tangible piece of paper but a universal abstraction called credit. Although written before the current economic crisis, the book proves to be extremely insightful, identifying in the symbiotic relationship between China and America ('Chimerica'), where the former saves and the latter spends, one of the causes of the modern crisis. The most important lesson of financial history is that sooner or later every bubble bursts, the 'bears' - the pessimistic sellers - outnumber the 'bulls' - the optimistic buyers - and greed turns into fear. So whether one struggles to make ends meet or strives to become the master of the universe, the need to understand the course of money and its function in the modern world has never been more urgent than today. (From the presentation of the edition) [...] The evolution of money played a crucial role in the evolution of humanity. Economic innovation is not the work of some leeches merely seeking to suck the blood from indebted families, or to risk the savings widows and orphans have gathered; on the contrary, it has become an absolutely necessary factor for man to rise from the miserable living conditions to the dizzying heights of material prosperity in which so many find themselves today. The evolution of credit and debt was as significant as any technological innovation in the upward course of civilization, from ancient Babylon to today's Hong Kong. Banks and the bond market provided the material basis which led to the splendor of the Italian Renaissance. The financing of companies was the necessary foundation of both the Dutch and British empires, just as the triumph of the United States in the twentieth century was inextricably linked to advances in insurance, mortgage lending, and consumer credit. And perhaps, all this will culminate in an economic crisis, which will signal the twilight of America's global primacy. [Excerpt from the introduction text of the edition]