MONEY GOING OUT OF STYLE

A historical evaluation of the nature and future of money.

According to Schreiber, the founder and CEO of international freight marketplace Freightos, currency, as we currently understand it, is the result of a tragic mistake: the decision of President Richard Nixon to decouple the value of U.S. currency from gold: “Would people still trust and desire money,” Schreiber asks, “when it no longer had any guaranteed underlying value?” In his view, the answer to that question has clearly been answered in the affirmative, and he cites a wide array of economists and other monetary experts who’ve held forth on the topic since 1971, right down to the unprecedented modern moment: “Never has monetary policy been more confusing than during the Covid-19 pandemic,” he writes, “during which the Fed printed close to two trillion dollars of brand-new money.” In order to illustrate his view of money’s history, he effectively imagines a small tropical island populated by a few hundred people and follows some of them as they embody different stages of economic development over the course of human history, including private ownership, barter, investment, and so on. The educational depictions of these stages are interspersed with Schreiber’s own analysis of the slow, gradual migration of economy away from “commodity money” (money comprising objects or materials like gold, with an intrinsic value) to a bewildering but engaging demonstration of what Schreiber calls valueless “bank money”: “People say ‘I have $100 in my checking account,’ but in fact what they have is a statement that the bank owes them $100.” In this way, the author uses vivid, accessible prose to demystify a whole battery of financial concepts, including global trade, and, toward the end of the book, cryptocurrency. Ultimately, he paints an alarming picture over the course of this narrative, but he does so in a way that readers will find incredibly informative.

A gripping and thought-provoking look at what currency truly means in the modern world.