How did money evolve from a crude system of coins that were worth only the value of the metals they were made of to a complex global financial system of credit, treasury bonds, hedge funds and credit default swaps that have shaped the course of human history? Niall Ferguson begins his journey in Bolivia, where 500 years ago, mines built by Spanish conquistadores, using forced Incan labor, produced so much silver coinage that the currency lost its value. In Italy, however, the roots of the modern financial world, in which currency's value is based on trust, began to take shape: A system of loans and credit between Jewish lenders and Christian merchants evolved in Venice, the Medici family developed the modern-day banking system and wars between city states created the bond market. In Amsterdam, the East India Company began to sell shares of stock to the public in the early 1600s, and in Paris, a Scottish fugitive named John Law saw in this new market an opportunity for an unscrupulous scheme - not unlike Bernie Madoff's - that created the world's first stock market bubble and, after its collapse, sparked a revolution.
