Ferguson’s study of the financial history of the world touches on a number of Theory of Knowledge areas of knowledge. He touches on history, ethics, natural sciences, and, most importantly, human sciences including economics. In examining the financial history of the world, Ferguson draws attention to the positive relationship between the growth and development of civilizations and the strengths and success of their financial and economic systems. Essentially, money is the reason for development in modern societies. These financial systems have allowed for quicker transactions, loans, and investments. Using such examples as the colonization of South America, Roosevelt’s New Deal, and the rise of China, Ferguson successfully argues this point. Drawing from a wide variety of examples, Ferguson effectively shows the reader that the correlation between the growth of financial systems and the growth of civilizations is not just a coincidence but a trend throughout history. In this way, Ferguson effectively uses history, an area of knowledge, to support his reasoning that finance is at the root of all human progress. His arguments are also effective because they use sound logic, are not terribly provocative, and therefore seem very reasonable to the reader. This is most likely because we live in a society that is heavily influenced by finance and money. The economy greatly affects our everyday life, something made increasingly evident in the current recession, where people are unable to maintain their old lifestyles of excessive spending. People are constantly trying to further their economic goals. As Ferguson puts it, “Bread, cash, dosh, dough, loot, lucre, moolah, readies, the wherewithal: call it what you like, money matters”. Ferguson’s arguments are so reasonable and true that they are easily proved through evidence from a wide range of countries and empires from the past.
Although Ferguson’s work is reasonable and offers great insight into the history of finance, a number of flaws and issues of knowledge arise that give us some interesting questions to think about. The first issue is Ferguson’s misuse of language. Ferguson tries to make a connection between financial systems and biological systems, saying that financial systems have genes, the potential for spontaneous mutation, competition between one another, natural selection, scope for speciation, and scope for extinction. While this may be an accurate and fair metaphor, it is odd that he relies on these biological terms to describe financial systems instead of describing them for what they are. At times, when making this connection, Ferguson stretches his analysis and, as a result, weakens his main arguments. A further example of this is his comparison of the extinction of dinosaurs to the extinction of large financial institutions. The second issue of knowledge arises when Ferguson tries to take ethics out of the discussion as he feels the reader will understand his telling of the financial history of the world better without it. He thinks talking about the ethics side of finance (i.e. is the study and practice of finance contributing to income inequality, and is it fair?) is of little importance to his argument. He also says that without finance, there would be no wealth at all. This removal of ethics from his argument raises some questions: can we take ethics out of the argument and still have a holistic view? Does knowledge not require a holistic view? How does this removal of ethics skew our reasoning? How does this removal of ethics change his argument? Does it make it more convincing? As we can see, one could spend an eternity on these questions. One could also question the validity of Ferguson’s argument, since it is not a holistic one. A major flaw also arises in Ferguson’s argument. Although Ferguson argues that all history is deeply grounded in the financial systems, he never makes it clear that all events in history have happened because of finance and financial systems, which is what he is obviously trying to prove. Instead, he dances around this assertion, weakening his argument considerably. In the end, however, the rationality of Ferguson’s argument overcomes these small flaws and problems.
In the bigger picture, Ferguson’s argument that finance is at the root of all human progress serves a great purpose. His argument reminds us that finance is an important part of our lives and that it must not be ignored. If finance is overlooked, our civilization may suffer the same fate that so many have faced before. Through his argument, we are able to understand better how our world works. Ferguson has illustrated to us the importance of these financial systems and how they affect our everyday lives. Our understanding of history has been enriched because we can now understand how major events were triggered by financial systems, or lack thereof. Ferguson’s argument serves as a warning to those who fail to appreciate the importance of financial systems by highlighting their key role in civilizations throughout history. In order to further our knowledge of the world in which we live, it is imperative that we appreciate and understand the scope, relevance and importance of Ferguson’s key argument: that successful financial and economic systems are at the root of all human progress and, by extension, will continue to be so.
In conclusion, Ferguson effectively explores finance’s role in history. Drawing from a variety of historical examples, he argues that finance is at the root of all human progress. Ferguson’s work enlightens us on the importance of financial systems and allows us to gain a better understanding of our world. The author’s work also raises some questions on issues of knowledge, such as when he removes ethics from his discussion believing the reader will gain a better knowledge of the history of finance without it. Ferguson has given us key knowledge in an area that many individuals know far too little about. With the knowledge that finance is the key to growth as a civilization, we can avoid the fate that many past civilizations have endured as a result of poor financial systems.
Work Referenced
Ferguson, Niall. The Ascent of Money: A Financial History of the World. New York: The Penguin Press, 2008.
