The Power of Gold; the History of an Obsession
Parker, Dereb, Bernstein, Peter L., African Business
[pound]39 John Wiley & Sons
Gold runs through the course of human endeavour like a glittering vein, a motor of history and the root of much blood and beauty. The reason for its importance has never been fully explained, except as one of the more persistent paradoxes of the human species.
Bernstein, whose previous book, 'Against the Gods: the Remarkable Story of Risk', was a surprise best-seller, has again assembled a cast of colourful characters to tell his tale. 'The Power of Gold', like 'Against the Gods', imparts a mountain of information in a way that seems far too entertaining for a volume about finance.
Bernstein points out that gold retains its lustre despite age, and its softness means that it can be transformed into foil, thread, dental fillings, or the finest jewellery. Beyond that it is essentially useless, from a functional perspective. Yet it is almost universally prized, to the point where it has never ceased to be scarce.
Bernstein muses that more than a few ancient empires were built on gold. Most of the gold of Biblical times came from southern Egypt and Nubia (nub is the Egyptian word for gold). Military campaigns were often conducted for the sole purpose of taking slaves for the mines.
The Sudanese kingdom of Jenne supplied a good part of Europe's gold, mainly in exchange for salt on an ounce for ounce basis. But this willingness to trade what is seen today as the useless for the essential is uncommon in the history of gold, says Bernstein.
Much of the Arab, and later European, exploration of Africa was undertaken with gold in mind. The demand for gold in the classical world seemed insatiable, especially amongst the imperial ruling classes. Bernstein recounts how the Roman Christian emperor Justinian lavished gold by the ton on the church of Saint Sophia. There was a precedent: God had instructed Moses to use plenty of gold in the Temple of Solomon.
In Europe, gold was democratised by its use in coins, even though successive rulers tried to debase them by mixing in lesser metals or reducing their size. But as a medium of exchange between individuals, gold coins work only up to a point. Beyond that, something else is needed. Marco Polo brought the Chinese idea of paper money to Europe, but Bernstein believes that the whole notion may have been something of an accident. …