• The End of Alchemy

  • Money, Banking, and the Future of the Global Economy
  • By: Mervyn King
  • Narrated by: Greg Wagland
  • Length: 14 hrs and 3 mins
  • 4.3 out of 5 stars (415 ratings)

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The End of Alchemy  By  cover art

The End of Alchemy

By: Mervyn King
Narrated by: Greg Wagland
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Publisher's summary

Something is wrong with our banking system. We all sense that, but Mervyn King knows it firsthand; his 10 years at the helm of the Bank of England, including at the height of the financial crisis, revealed profound truths about the mechanisms of our capitalist society. In The End of Alchemy, he offers us an essential work about the history and future of money and banking, the keys to modern finance.

The Industrial Revolution built the foundation of our modern capitalist age. Yet the flowering of technological innovations during that dynamic period relied on the widespread adoption of two much older ideas: the creation of paper money and the invention of banks that issued credit. We take these systems for granted today, yet at their core both ideas were revolutionary and almost magical. Common paper became as precious as gold, and risky long-term loans were transformed into safe short-term bank deposits. As King argues, this is financial alchemy - the creation of extraordinary financial powers that defy reality and common sense. Faith in these powers has led to huge benefits; the liquidity they create has fueled economic growth for two centuries now. However, they have also produced an unending string of economic disasters, from hyperinflations to banking collapses to the recent global recession and current stagnation.

How do we reconcile the potent strengths of these ideas with their inherent weaknesses? King draws on his unique experience to present fresh interpretations of these economic forces and to point the way forward for the global economy. His bold solutions cut through current overstuffed and needlessly complex legislation to provide a clear path to durable prosperity and the end of overreliance on the alchemy of our financial ancestors.

©2016 Mervyn King (P)2016 Audible, Inc.

Critic reviews

"Mervyn King may well have written the most important book to come out of the financial crisis. Agree or disagree, King's visionary ideas deserve the attention of everyone from economics students to heads of state." (Lawrence H. Summers)

What listeners say about The End of Alchemy

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    5 out of 5 stars

Two books in one, both very fine

A note added Nov. 2019, on a second listening: this book, particularly the first 60 percent of it, is one of the most clear and informative books on anything I have ever read. In particular, it tells in plain language, yet with great depth and elegance, what, in a world of an unknown future, finance does for us, and further, how money and banking (as now managed, imperfectly) facilitate this, and (sometimes dramatically) fail to facilitate this. Nobody has ever described finance this well for me. This book, some years post-release (and after such events as Brexit, Trump's election, and the recent fractures in global trading), wears well, being pretty timeless in approach. Nothing like the solutions the author suggests in the later parts of the book, has occurred. We remain vulnerable to the problems he pointed out so lucidly. My original review follows.

Here we have a tutorial on basics of money, banking and (some) finance, and their history. All the contemporary terminology is neatly fit into the explanations. It is a great way to become widely literate and current on this. Secondly, having educated and briefed the audience, the author shares his proposal to replace the overall central banking LOLR (lender of last resort) model (dating back at least to Walter Bagehot in his book 'Lombard Street' (available here), and the origins of modern central banking), with a PFAS (pawnbroker for all seasons) model. This in effect forces a kind of insurance premiums or pre-haircuts to be baked into credit deals from the start, to pay when they default en masse as they did in '08. I have seen this model criticized, as blocking the wild experimental quality of capitalism. But it is a great try and at least a start at remodeling the system so we won't have our overall financial system keep working in straightened times as an emergency insurer after the fact (after a financial collapse), charging ex post premiums back to us peasants for decades to come, while the fat cat bankers get bailed out (as the popular trope goes), and party on, with no fundamental fix to this model offered, to date. (Let me pause and say I do see some virtues in Dodd-Frank. I believe it goes some length toward reducing the frequency and depth of these problems.) Bravo for a very interesting read, and something to be pursued. This is the first Great Recession book (of dozens I have seen, most of the major titles) where anyone has bothered to propose any sizeable substantive changes. This deserves more workup. Very enjoyable and I expect to listen through again.

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11 people found this helpful

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Educational and thought provoking

Very educational and thought provoking book. Mervyn King's audience here is anyone who not only wants to understand what happened during the financial crisis, but wants to better understand why it happened and what needs to change to prevent another. Thankfully, this isn't a book about finger pointing.

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Very very good

This is one of the best explanations of money, banking and our contemporary financial challenges in the world. And does provide some hope for the future but is very blunt, appropriately, about our realities. I highly recommend it.

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A good look at the crisis and what to do

This is my second reading. End of Alchemy is one of the most important books I have read. It is a very serious work from an honest and experienced practitioner that has seen pretty all.

I hope that we ride the Audacity of pessimism to Uhuru.

Well done and thank you Sir Mervin King.

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must read

it's dense but so are the problems he's conveying. He does an especially good job of stating complicated financial ideas in layman's terms.

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    3 out of 5 stars

Interesting but dry

Good summary and explanation of central bank purpose and function and rational supporting the policy.

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Excellent. Excellent!!

Well written, well narrated. Highly recommended. Easy to follow and understand a very complex topic due to these positives. Excellent.

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    3 out of 5 stars

a lot of standard economic platitudes

This the typical boiler plate and standard economic jibberish that obfuscates at least as much as it illuminates. Banking alchemy this, capitalism is the best bet that, increasing productivity is the key... etc etc. He never even touches upon the radical divergence between productivity and real wages that starts in 1971. We sure wouldn't want to acknowledge anything that shows we are full of bunk. None of propositions have aged well. Don't dispare though. Bitcoin fixes this.

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Amazing!

Radical uncertainty deserves more attention and thankfully King brings in front and center in his reform proposals

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Clear and illuminating

With a clear and modulated performance, Greg Wagland allows us to better understand Mervyn King’s illuminating and engaging book about money and banking.

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