The whole of the Western financial system was collapsing, with nothing to hold back the tide. In mid-September 2008, the financial crisis that had been sweeping across the Western world for more than a year reached its climax. Here we present an excerpt from the Introduction. We can thus grasp the different eras of monetary regulation and the crises capitalism has endured throughout its history. Money employs the tools of anthropology, history and political economy in order to analyse how political structures and monetary systems have transformed one another. Looking over the last 5,000 years, Michel Aglietta explores the development of money and its close connection to sovereign power. If confidence in money is not maintained, crises follow. Through its grip on finance and the debt system, money confers sovereign power on the economy. It was a strategy that raised questions about the unexamined nature of money itself, an object suddenly revealed as something other than a neutral signifier of value.
What saved finance, and the Western economy, was fiscal and monetary stimulus – an influx of money, created ad hoc. When a senator asked Bernanke what would happen if the central bank did not carry out its rescue package, he replied, “If we don’t do this, we may not have an economy on Monday.” The whole financial system was collapsing, with little to stop it. Money: 5,000 Years of Debt and Power is a featured book on our 10 Years Since the Financial Crisis Reading List.Īs the financial crisis reached its climax in September 2008, the most important figure on the planet was Federal Reserve chairman Ben Bernanke.
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