The Cash Nexus: Money and Power in the Modern World, 1700-2000
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The Cash Nexus: Money and Power in the Modern World, 1700-2000

3.76 of 5 stars 3.76  ·  rating details  ·  262 ratings  ·  22 reviews
"The cash nexus is the crucial point where money and power meet. But does money make the political world go round? Does the success of democracy depend on economic growth? Does victory always go to the richest of the great powers? Or are financial markets the true 'masters' of the modern world?" "With the analytical boldness and the grasp of dazzling detail for which he is...more
Paperback, 380 pages
Published February 21st 2002 by Basic Books (first published January 1st 2001)
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Oct 11, 2013 Mike rated it 3 of 5 stars  ·  review of another edition
Recommends it for: Anyone

It’s not this book’s fault that I took over a month to complete it. No, that was purely self-inflicted. In fact The Cash Nexus was a book that I looked forward to reading – even while I was reading it. Under other circumstances I’m sure I would have finished it in only a week or two. After all it is both shorter and has fewer citations & quotations than the two volumes of The Rothschilds which I read earlier this year. In fact I doubt that it would even crush a kitten, let alone cause perman...more
Whew. Another big one from Ferguson. His books are a real treat to grapple with. He covers everything from novelists to bond yields to imperialism. Not your typical economic history.

He likes going after big issues, and he has some big claims to make. Some points he makes:

-Nations running debt is not always a bad thing.
-There is a relationship between taxation and war (not much of a surprise).
-Economics does not necessarily influence election results. Very heavy use of historical comparisons and...more

P.318 "In theory, it is without doubt preferable to pay pensions through investment earnings from private pension funds rather than through taxation and social security ("Pay As You Go").

P.325 "indeed, an ounce of gold buys approximately the same amount of bread today as it bought in the time of Nebuchadnezzar, king of Babylon, more than 2,500 years ago."

P.367 "according to Barro, the key contributions a government can make towards growth are:
1. providing or encouraging the provis...more
Erez Davidi
Does money make the world go `round ?

In The Cash Nexus, Niall Ferguson analyzes the relationship between money and power in the modern world.

In the first part of the book, Ferguson starts by exploring the history of taxation, mainly of Britain and France. He continues with the transition that most Western countries went through after WWII from warfare states to welfare states.

He then goes on with how countries dealt with their excessive public debt problems (a problem that is more than relevant...more
What you get:

*Elementary insights into how depth and breadth of capital markets can effect(substantially influence)geopolitical outcomes (victory vs. defeat).

*An examination of who pays for what(and who benefits from these payments)in a few given societies.

*Other things

I think, the last two sentences of this book very nicely sum it up:

"Until we understand the mechanics of power--In this case, the reliance on the Napoleonic regime on extortion from occupied territory, it's undemocratic character...more
At one point halfway through I thought I'd never come close to finishing, but after a hiatus of probably 6 months it's done with.

I'd wanted a history of the bond markets and got an incomplete one but with a lot more, not necessarily desirable political baggage. Though I realise now I probably meant to get his 'Ascent of Money' instead.

The narrative parts were very good but a deluge of statistics and graphs really broke up the flow. He's good on the economics but could reference a lot more politi...more
Silvio Curtis
Rambling exploration of a lot of different facets of the relationship between economics and history, especially between government finance and military power. Does purport to have an overarching thesis but in practice doesn't connect with it much. Information is mixed with ethical judgments. The ethical part was argued too carelessly, if at all, to be stimulating. On the other hand, I learned a fair amount on the factual side about things like methods of government finance. I could understand so...more
Definitely not a book to take to the beach. Pretty dense, though not theoretical. Mostly, Ferguson wades through mountains of empirical data about spending to GDP ratios and democracy indices in search for answers to big questions: economic determinism, the rise of the state, the spread of democracy, etc. I mostly read it for the thesis about how tax rates are related to the ratios between taxpayers and voters, i.e., the lower the ratio, the higher the rate of direct taxes, and the higher the ra...more
H Wesselius
not exactly pleasure reading but informs. Ferguson displays a bias toward neo-liberal economics and pro-American foreign policy yet those on the left can also find much to agree with including --- bondholders have opposing interest to the unemployed, democracy changes the warfare state to the welfare state with an American exception, post WWII economics ended in the early seventies with no new form of stability, debt service is more important than debt repayment. Worth the read if you are intere...more
I love Ferguson but he can be dense. While I find reading about the history of the international bond market fun, not everyone does ;) Ferguson's main point here is that four pillars created the successful structure of Western economies: taxation and representation, respect for private property, government debt and the welfare economy.
As always Ferguson is well-researched and appropriately footnoted. Great book for the political economists amongst us.
I learned a good deal from this book, but it was tough to get through. I don't really recommend it unless you have a burning desire to understand government debt and financing. It is pretty cool stuff, though, and many of the insights in the book had immediate application to what has been going on in our country lately.
Marvelous book, I couldn't put it down. Wonderful discussion of the development of bond markets and national finance and their interactions with politics and society. Very well written, could have been a very dry, dull discussion but instead a very entertaining read.
Jeremy Raper
I read this for a class but you could read it casually if you are interested in the history of finance. Holds the reader's interest pretty well, not as good as some of his other books though.
Other than "Fooled by Randomness" this is my most frequently recommended book to read. A great review of debt super cycles and the cyclical nature of debtor-creditor inversions. Timely read given the current sovereign debt issues.
May 17, 2008 Dave added it
This book has a lot of detail, but that's because the author is putting forward such a large, important proposal.

History deals with "great men" and powerful armies. Niall Ferguson answers the question: "where'd they get the money?"
Dusan Milenkovic
Too much numbers in the first half of the book. Too much statistics. He had some really interesting points, about globalization now and century before, or comparation of Austro-Hungarian monarchy and EU.
Too much of this was beyond my abilities and interest, but I must give him due credit for his '4 square of power,' which I found persuasive.

interesting ideas but really horrible writing and organization make this a painful read. read only a quarter of the book.
Number dense, an interesting read. War and everything else from an economic perspective. Bonds for the win!
John Seno
Good arguments but was a bit of a drag due to data overload!
This book describes how different taxation and debt management methods have allowed countries to have various levels of success politically and militarily from 1700 to 2000. In recent years, Western countries have gone from being warfare to welfare states, due to a change in the largest portion of their budgets. Many governments' generational fiscal policy will not be able to be maintained, and either taxes will need to be raised or government benefits will need to be reduced. Aging populations...more
His best book.
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Niall Ferguson (born April 18, 1964, in Glasgow) is a British (Scottish) historian who specialises in financial and economic history as well as the history of empire. He is the Laurence A. Tisch Professor of History at Harvard University and the William Ziegler Professor of Business Administration at Harvard Business School. He was educated at the private Glasgow Academy in Scotland, and at Magdal...more
More about Niall Ferguson...
The Ascent of Money: A Financial History of the World Empire: How Britain Made The Modern World Civilization: The Six Ways the West Beat the Rest The War of the World: Twentieth-Century Conflict and the Descent of the West The Pity of War: Explaining World War I

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