Wednesday, July 29, 2009

PBS Nova: "The Ascent of Money" with Niall Ferguson

PBS Nova has been airing a four hour series with British financier Niall Ferguson, “The Ascent of Money”. Some versions of the show have it packaged as two two-hour segments. On July 29, the last episode “Planet Finance” traced the history of “globalization” of a property economy back to the end of the Great Depression.

Money and property provides a granularity to human interactions. There was an objection to the idea that property owners “watch” and benefit from the labor of others – leading to Marxism and Communism. But the idea of mortgaging and financing property ownership right after WWII provided a “moral compromise.”
But real estate markets have busts. The high interest rate cycles of the 1980s eventually led to the real estate bust and savings and loan scandal (particularly in Texas with Empire Savings and Loan, whose unfilled foundations near Dallas still show the scars of a previous crisis). The 2008 crisis is fundamentally different in mechanics with the attempt to export highly leveraged financing to the rest of the world. In fact we have ten times our global domestic product invested in derivatives.

The link is here.

The first episode traced how fiat money came about, as a replacement for “karma”. Teenagers typically live in a “moneyless” society controlled by others yet rich in possibilities, but real freedom is possible only with a standard medium of exchange. Ferguson says that financial history is the “back story” behind all history.

Tonight, on PBS WETA, Charlie Rose interviewed Homeland Security secretary Janet Napolitano. The idea that enough nuclear material could slip through for terrorists (like the NC group) to make a small weapon was discusses. Preparations for H1N1 were discussed, but it seems that the administration tends to be soft on employers over “presenteeism” and not too enthusiastic about social distancing.

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