There are no prizes for predicting a big financial crisis unless you’re George Soros and bet big sums of money on it as he did. As a historian, I’ve only got my reputation to bet, which is a far less useful strategy.’ Niall Ferguson is professor of history at Harvard and has a reputation for radical and sometimes controversial interpretations of history: The Pity of War (it would have been better if Britain had stayed out of the First World War) and Empire (the British Empire should be regarded on the whole as a force for progressive good in the world), for example.
His latest television series and accompanying book, The Ascent of Money, charts the evolution of financial institutions and instruments, from early beginnings in Renaissance Italy to the recent months of the credit crunch. Despite the current turmoil, he believes
that creative finance has been crucial to our prosperity. To say the least, the book and series are very timely. Prof Ferguson has a good line in black humour. ‘I’d arranged that the Lehman Brothers bank would go under at the end of October, not September. I can’t imagine how the publicity people messed that up. ‘I’d been running around talking to people in finance about a possible liquidity crisis before this book took shape, as I was hoping that a little financial history would temper the appetite for risk.
In 2006, I addressed the annual jamboree organised by Morgan Stanley for its hedge-fund clients and spoke to them about a potential liquidity crisis. But they were at their most bullish, and, afterwards, one of them suggested that the following year my speech could be replaced by a screening of Mary Poppins. I was rather hoping to be proved wrong, because the consequences of this crisis will be very unpleasant for a large number of people.’ Prof Ferguson is much in demand on both sides of the Atlantic by academic and financial institutions. ‘On average, I probably cross the Atlantic every two weeks. Which is pretty tiring. I suspect the truth is that I’m a rootless cosmopolitan.
I like being part of the US and Europe and the UK, but also semi-detached from them. I don’t need anywhere special to write. I just have my laptop. Much of The Ascent of Money was written on aeroplanes. Writing is how I cope with my peripatetic existence.’ Five years ago, he bought the great house of Sker in south Wales, a rambling Tudor mansion (Country Life, July 2). ‘It anchors me in the British Isles. If I hadn’t bought it, my centre of gravity might have shifted across the Atlantic. I suppose it’s a holiday cottage for people with delusions of grandeur. My wife [Susan Douglas, a leading journalist and former editor of the Sunday Express] spotted it for sale in a tiny ad in Country Life, and in a moment of madness said yes. It was a total wreck close to collapse. Now it’s a lovely place, somewhere to escape from departure lounges and only 2½ hours from my home in Oxford. I’m not meant to say that Wales is ‘Scotland Light’, but it is.
Also, two of my three children are now teenagers and you have to create opportunities to see them or else in the holidays their friends will trump you with skiing or Greek islands. Sker is great because there’s surfing and plenty of space for them and all their friends.’ His next book will be out next year, a biography of the merchant banker Siegmund Warburg. ‘It’s been fascinating getting inside the head of this very complex man. He was a cerebral, politically aware, literate banker who wrote a great deal about what he thought. He was the architect of London’s revival as a financial centre after the war.
Warburg pioneered hostile takeovers in the 1950s, mergers and acquisitions in the 1960s, and later the Eurobond market. He was very unusual, as he was a banker who didn’t really care about the bottom line he simply wasn’t interested in money. He didn’t buy works of art or big houses or racehorses. What interested him was the psychology of relationships with clients and employees.’ Beyond that, there is the very big project of writing Henry Kissinger’s official biography, which will probably take another three years. ‘The material is vast. I’ve been talking to him a great deal and we’ve filmed interviews that have turned out very well. He’s one of the cleverest people I’ve ever met. ‘I love what I’m doing. I’m often jetlagged, but never bored.’
‘The Ascent of Money’ will be broadcast on Channel 4 in November. The book to accompny the series is published by Allen Lane at £25
