October 10th, 2012
The Ascent of Money - Individual Essay
The Ascent of Money written by Harvard Professor Nail Ferguson as a way to converse about “The Financial History of the World” (Ferguson, 2009). Ferguson describes the increase and development of economics concentrating on insurance, financial institutes, and the bond market. Ferguson reveals the method in which history can enlighten our comprehension of the existing economic predicament for American worldwide domination or control.
Ferguson's main premise is that these institutions, which are highly criticized these days, are vital for the success of the capitalist system. Stock markets allow companies to raise money in order to expand their businesses and by that create jobs, or provide services in which the consumer is interested in. In the process, the quality of life of the people, who got hired or received better services, has improved. The banking system achieves a similar goal, but in a different manner. The banking system acts as the middleman, between the person who wants to lend money and the person who wants to borrow money. Doing so, helps to allocate better capital into places where it is more needed.
In the episode entitled “Risky Business,” Ferguson observes the origin of the insurance trade in Europe; how catastrophes similar to Hurricane Katrina depicts dilemmas in risk management, how countries like Japan and Chile administer risk for their people; and the large rewards that can be accumulated through risk with hedge funds (Ferguson, 2009).
The position of jeopardy engaged in the insurance industry. Comprises the incapability to cover-up the payments owing from the disaster rooted by Hurricane Katrina; the source of the insurance trade; how Japan converted into a wellbeing state, and it’s penalties in the current day; Chile leaving from the welfare state model in the 1970's; the...