The Power of Gold: The History of an Obsession
This fascinating account begins with the magical, religious, and artistic qualities of gold and progresses to the invention of coinage, the transformation of gold into money, and the gold standard. The more important gold becomes as money, the more loudly it speaks of power--even more loudly than when it served as an entry to Heaven or a symbol of omnipotence. Ultimately, the book confronts the future of gold in a world where it appears to have been relegated to the periphery of global finance.
From the Bible to the Gold Rush era to modern day Fort Knox and beyond, unforgettable characters stride through these pages. Contemplate gold from the diverse perspectives of monarchs and moneyers, potentates and politicians, men of legendary wealth and others of more plebeian beginnings; from Asia Minor's King Croesus to Rome's noted speculator Crassus, to Byzantine emperors and humble miners, Venice's Marco Polo and Spain's Francisco Pizarro, to Charlemagne and Charles de Gaulle, Richard I and Richard Nixon, Isaac Newton and Winston Churchill, Britain's economists David Ricardo and John Maynard Keynes, and Christopher Columbus and the Forty-Niners. Perhaps most remarkable are the frantic speculators who pushed gold to $850.00 an ounce in 1980 just as their counterparts twenty years later drove Internet stocks to exorbitant heights.
Whether it is Egyptian pharaohs with depraved tastes, the luxury-mad survivors of the Black Death, the Chinese inventor of paper money, the pirates on the Spanish Main, or the hardnosed believers in the international gold standard like the United States' President Herbert Hoover, gold has been the supreme possession. It has been an icon for greed and an emblem of rectitude, as well as a vehicle for vanity and a badge of power that has shaped the destiny of humanity through the ages. As Bernstein muses, "The joke is that nothing is as useless and useful all at the same time."
Far more than a tale of romantic myths, daring explorations, and the history of money and power struggles, The Power of Gold suggests that the true significance of this infamous element may lie in the timeless passions it continues to evoke, and what this reveals about ourselves.
A METAL FOR ALL SEASONS.
Get Gold at All Hazards.
Midas's Wish and the Creatures of Pure Chance.
Darius's Bathtub and the Cackling of the Geese.
The Symbol and the Faith.
Gold, Salt, and the Blessed Town.
The Legacy of Eoba, Babba, and Udd.
The Great Chain Reaction.
The Disintegrating Age and the King's Ransoms.
The Sacred Thirst.
THE PATH TO TRIUMPH.
The Fatal Poison and Private Money.
The Asian Necropolis and Hien Tsung's Inadvertent Innovation.
The Great Recoinage and the Last of the Magicians.
The True Doctrine and the Great Evil.
The New Mistress and the Cursed Discovery.
The Badge of Honor.
The Most Stupendous Conspiracy and the Endless Chain.
THE DESCENT FROM GLORY.
The Norman Conquest.
The End of the Epoch.
The Transcending Value.
World War Eight and the Thirty Ounces of Gold.
Epilogue: The Supreme Possession?
It defileth not
WHAT is the eternal lure of gold? Peter Bernstein is rather unpoetic on the Subject. He tell us of its "stubborn resistance to oxidation, unusual density, and ready malleability", claiming that these simple physical attributes explain everything we would want to know about the element's romance. Perhaps he is right. But consider the words of an early 17th-century English merchant, Gerard de Malynes, saying more or less the same, but in quite different tones:
"Such is the qualitie of fine Gold that the fire doth not consume it...neither is it subject to any other Element...it is easily spread in leaves of marvellous thinnesse; in colour it resembleth the Celestiall bodies, it defileth not the thing it toucheth; it is not stinking in smell; the spirit of it can by art be extracted."
Malynes had the bug, Mr Bernstein doesn't. Because gold's allure is rather lost on him, the author underplays the universality of its attraction, dwelling instead on the curse that has frequently befallen its admirers-from Crassus, a Roman plutocrat who died when Parthians poured molten gold down his throat, to Montagu Norman, the highly-strung governor of the Bank of England at the time of Britain's return to the gold standard in 1925.
Mr. Bernstein's sympathies lie rather with John Maynard Keynes, who famously denounced gold as the "barbarous relic", and with Benjamin Disraeli, who once declared that the "gold standard is not the cause, but the consequence of our commercial prosperity." Mr. Bernstein cites this comment more than once. But is it true? Could the credit and trade of the British empire have been established on any other monetary standard? The answer is probably not. Once gold protected people against the depredations of tyrants. However, the age of democracy has legitimised flat currencies. This explains why John Law failed to impose a paper currency in France in the early 18th century (this key moment in the history of gold is strangely overlooked by Mr. Bernstein). By the 20th century, gold had become an anachronism, as Keynes correctly recognised. It took others longer to release themselves intellectually from their "golden fetters". The populace of Britain suffered for this in the 1920s, as did the Americans in the early years of the 1930s depression. Today gold is simply an adornment. Long may it remain so.
--The Economist, October 14-20th, 2000 Edition
"Bernstein...gives us a multifaceted depiction of the powerful pull gold has...his grasp on things financial...is firm, and he's admirably adept at explaining them."
--New York Times Book Review