100 books like The Evolution of Central Banks

Friedman, a Nobel-winning former Economics professor, writes brilliantly and playfully, and students of economics love to read him. Yet he delves into the heart of the monetary problems that have been confronted historically. This he uses to shed light on how to conduct monetary policy today.

He ranges across the whole of American history. For example, the failure of the Continental Congress’s currency occurred since it was printed to finance the Revolutionary War when there was no federal government and no federal tax revenue. This led to the new US Constitution and the ability to raise taxes, and a stable currency that was backed by gold and silver.

With the Civil War, the US Treasury printed money called “greenbacks” and suspended conversion to gold and silver during the War, but re-established convertibility in 1879 at the pre-War rate. Friedman shows how this convertibility led to prolonged, hugely damaging deflation for… show more.

Lombard Street is the classic statement of how central banks began functioning to insure the private bank system against bank panics. Walter Bagehot wrote this at the time of a revolution in banking that came about after the Joint Stock Companies Act of 1862 allowed private banks to have limited liability. Banking then boomed in England, and the Bank of England went from being a private bank to a bank also serving the Crown of England, and finally into a central bank as we see them today. 

The Bank of England would hold reserves for the entire private banking system should they need them in times of bank panic, which were periodic in those days (and still today). At the same time, the Bank provided the money supply through note issue. This created a money and banking authority that was efficient in its practice of stabilizing the money and financial… show more.

Bernholz, a renowned Swiss Economics professor, builds upon Friedman to provide an unparalleled view of how budget deficits and high government spending end up being financed by the “inflation tax” of printing money to cover the deficits.

Throughout history back some two thousand years, Bernholz describes ancient and modern monetary regimes based on metallic standards and fiat money unbacked by any metal. He analyzes how increased money supply causes moderate, high, and hyper-inflations throughout this history. He provides dozens of historical examples of money and inflation in times of crises including war.

Bernholz adds the dimension of how international exchange rates are affected during rising inflation and when deflation ultimately occurs. He shows how different “laws” regulate behavior, with good money driving out bad money until the bad money collapses in value and then good money is created or imported that drives out the bad money to its extinction. Bernholz… show more.

King was the head of the Bank of England during the financial crisis of 2008. He declared full deposit insurance for the entire United Kingdom private banking system, with no deposit premiums required. This ended the run on the banks that spilled over into the streets of the UK during the crisis, when the Bank of England at first decided not to take care of Northern Rock, a private retail bank that was headed towards insolvency.

King provides a whimsical and sharp review of the private and central bank system before and after the crisis that builds very much on Charles Goodhart and Walter Bagehot. King laudably faults economists and the Economics profession for thinking that establishing negative real interest rates worldwide is the answer to central bank crises (in his newly added Introduction to the paperback edition of his 2016 hardback by the same name). Yet King sides with… show more.

Empire, Incorporated makes it clear that corporations mattered in shaping the British Empire. But how did they actually operate?

Virtuous Bankers offers a window into an ordinary workday at the Bank of England, one of the most important institutions in eighteenth-century England. In the process, the book provides new insights into the nature of public credit and the growth of the British state, as well as an engrossing introduction to everyday life in Georgian London. 

Most of us think of economics and economic policy making the same way that we do about other scientific fields, such as physics or engineering. Like those sciences, economics uses numerical models and mathematical analysis to explain how the world works.

In contrast, this book reveals how economics is a very different kind of science from physics or engineering. Holmes shows how economists and economic policy-makers rely on language as much as, or even more than, numbers to achieve their desired policy goals. 

This book tells the story of the global expansion of the dollar system after the collapse of Bretton Woods from the perspective of the BIS, the global central bank.

Created in 1930, as a last-ditch effort to backstop the sterling system (among other reasons), the story of the BIS runs parallel to the story I tell in my book.  This morning in class I asked my students, most of them international relations majors, if any of their other courses had mentioned the BIS, and not a single hand went up. Hence this recommendation!

Kindleberger worked at the BIS 1939-1940 and might well have made it his permanent home had not World War II intervened, and sent him back home to the Fed.  

The book brings together a series of contributions to monetary macroeconomics as well as Bernard Schmitt’s last critique to relative price determination.

I recommend it to the reader interested in monetary theory because it gives an overview of the most challenging topics in this field, from money to financial crisis, passing through profit formation, inflation, and unemployment.

International issues are also considered, while a groundbreaking analysis of sovereign debt and interest payments is presented in what was to become Schmitt’s last contribution in English to international macroeconomics.

As a finance guy, I had always heard of the BIS or Bank for International Settlements, but I had no idea what it did, how it worked, or its history.

Adam LeBor expertly explains in the Tower of Basel not only what and who the BIS is, but how they have manipulated and influenced the global economy for generations. Despite the bank's strong connections to the Third Reich during the 1930s, the BIS continues to dominate global finance today as the central bank for central banks.

Every two months, leaders from the most powerful central banks in the world including the Federal Reserve meet in Basil to chart a course for the world economy under a cloak of secrecy. Tower of Basel rips the veil from this clandestine organization and exposes dark forces few are aware of.

This book not only offers an authoritative account of what the Federal Reserve has been up to since its founding in 1913 but also the rationale for why they did what they did. 

One particularly telling observation is made with respect to Arthur Burns, who was the Federal Reserve Chair during 1970-1978: “Burns always attributed [inflation] to nonmonetary sources.” Paul Volcker’s actions during 1979-1987 demonstrated how the restoration of monetary stability was a sine quo non for ending the 1970s inflationary spiral. No matter how necessary the Federal Reserve’s later massive 2020 monetary expansion may have been, it was imperative that this bulge in money also be unwound. 

A worrying element, however, is that, in the midst of all this, none of today’s Federal Reserve policymakers “ever mentions money.”