Niall Ferguson at the Jaipur Literature Festival
I didn’t expect to update this blog at all while I was in India, since I’ve been more or less regularly updating the blog I made especially for this trip. However over the past few days I have been at the Jaipur Literature Festival. Given the high-brow nature of most of the events I felt like I’d be slighting A NEW NADIR by neglecting it. After all, I’ve crafted a cynicism and remoteness unique unto itself, and it’d be a true crime if I passed up Niall Ferguson’s talk on the financial collapse, especially given my comprehensive (and, I might add, impressively insightful) coverage already.
Niall Ferguson has a silver tongue. As I left his discussion of The Ascent of Money at the Jaipur Literature Festival, a woman in front of me commented: “He speaks so well. He just makes you feel like you’re not such an idiot.” A rare talent. Ferguson, you handsome dog. You’ve taken India by storm. The moderator, Omair Ahmad, did nothing to conceal his awe for your institutional endorsements (I wanted to ask: how does one successfully hold chairs at Harvard, Stanford, and Oxford at the same time?). Ferguson’s book is a history of money, and the instrumental role it played in the ongoing financial Crisis. “Blame ignorance,” he says, for the financial crisis. It was our lack of knowledge about the financial devices we trusted to grow our savings which caused the crisis, not the devices themselves.
Thankfully, Ferguson’s book is here to pull us out (by our necks, if necessary) from our platonic ignorance and let us bask in the light of knowledge. To his credit (and against my own naturally sarcastic tendencies), Ferguson was very good-humoured about the fact that the entire gig seemed a kind of sham-plug for his own book.
Ferguson took little time to jump into geo-politics and economics (firm ground for every would-be theorist of decline) and away from money (on which he is on shaky ground–I will discuss this later).
But more about money (this is, after all, 1/4 of the title of his book). He defines it as a relationship between debtor and creditor. While this might be a rough definition of money at its inception, he ignores that most crucial of functions which money performs: storing value. There is a reason that banks horded (and indeed continue to horde) cash in the immediate aftermath of the financial crisis: its liquidity. It is a liquid asset, and an asset is not something that signifies debt or credit. It is something valuable in itself. Gold, Money, and Oil are all valuable to investors because they are relatively easily converted into other forms of value, be it food or electricity.
Ferguson himself should be unsure of his footing. He teaches classes at the Harvard Business school, the font of all the false prophets of the “global economy” and the so-called “risk-spreading vehicles”. How can someone on the one hand condemn the derivatives, CDO’s, CDS’s and all other manner of incomprehensible financial instruments which are logically implied by the financial system he simultaneously argues will be the saviour of the world’s poor?
Of course, this is all very well and good coming from the mouth of a man who and to the ear’s of an audience which has relatively little fear of extreme impoverishment. Ferguson invokes the great depression as a comparable financial crisis, but the real historical lesson of 2006-2007 is that the governments of all the “democracies” of the west threw in their chips with the very rich (because they were numerous enough to bankroll the campaigns of misinformation necessary to maintain their hold on power). The new world order is not one which will benefit everyone equally but which will ossify a class of super-wealthy plutocrats who will increasingly exert power not only over our nation’s fiscal but also political capital.
Of course, the really interesting idea here is that this could be the beginning of the next evolutionary step in human history: the creation of a massive underclass meant to serve the needs and achieve the physical aims of a small but insurmountably-strong ruling class. Let’s hope that the ones who end up on bottom can’t read or write.
Niall Ferguson and the Descent of Cash
Niall Ferguson at the Jaipur Literature Festival
I didn’t expect to update this blog at all while I was in India, since I’ve been more or less regularly updating the blog I made especially for this trip. However over the past few days I have been at the Jaipur Literature Festival. Given the high-brow nature of most of the events I felt like I’d be slighting A NEW NADIR by neglecting it. After all, I’ve crafted a cynicism and remoteness unique unto itself, and it’d be a true crime if I passed up Niall Ferguson’s talk on the financial collapse, especially given my comprehensive (and, I might add, impressively insightful) coverage already.
Niall Ferguson has a silver tongue. As I left his discussion of The Ascent of Money at the Jaipur Literature Festival, a woman in front of me commented: “He speaks so well. He just makes you feel like you’re not such an idiot.” A rare talent. Ferguson, you handsome dog. You’ve taken India by storm. The moderator, Omair Ahmad, did nothing to conceal his awe for your institutional endorsements (I wanted to ask: how does one successfully hold chairs at Harvard, Stanford, and Oxford at the same time?). Ferguson’s book is a history of money, and the instrumental role it played in the ongoing financial Crisis. “Blame ignorance,” he says, for the financial crisis. It was our lack of knowledge about the financial devices we trusted to grow our savings which caused the crisis, not the devices themselves.
Thankfully, Ferguson’s book is here to pull us out (by our necks, if necessary) from our platonic ignorance and let us bask in the light of knowledge. To his credit (and against my own naturally sarcastic tendencies), Ferguson was very good-humoured about the fact that the entire gig seemed a kind of sham-plug for his own book.
Ferguson took little time to jump into geo-politics and economics (firm ground for every would-be theorist of decline) and away from money (on which he is on shaky ground–I will discuss this later).
But more about money (this is, after all, 1/4 of the title of his book). He defines it as a relationship between debtor and creditor. While this might be a rough definition of money at its inception, he ignores that most crucial of functions which money performs: storing value. There is a reason that banks horded (and indeed continue to horde) cash in the immediate aftermath of the financial crisis: its liquidity. It is a liquid asset, and an asset is not something that signifies debt or credit. It is something valuable in itself. Gold, Money, and Oil are all valuable to investors because they are relatively easily converted into other forms of value, be it food or electricity.
Ferguson himself should be unsure of his footing. He teaches classes at the Harvard Business school, the font of all the false prophets of the “global economy” and the so-called “risk-spreading vehicles”. How can someone on the one hand condemn the derivatives, CDO’s, CDS’s and all other manner of incomprehensible financial instruments which are logically implied by the financial system he simultaneously argues will be the saviour of the world’s poor?
Of course, this is all very well and good coming from the mouth of a man who and to the ear’s of an audience which has relatively little fear of extreme impoverishment. Ferguson invokes the great depression as a comparable financial crisis, but the real historical lesson of 2006-2007 is that the governments of all the “democracies” of the west threw in their chips with the very rich (because they were numerous enough to bankroll the campaigns of misinformation necessary to maintain their hold on power). The new world order is not one which will benefit everyone equally but which will ossify a class of super-wealthy plutocrats who will increasingly exert power not only over our nation’s fiscal but also political capital.
Of course, the really interesting idea here is that this could be the beginning of the next evolutionary step in human history: the creation of a massive underclass meant to serve the needs and achieve the physical aims of a small but insurmountably-strong ruling class. Let’s hope that the ones who end up on bottom can’t read or write.