Liaquat Ahamed chose a very difficult topic for his first book. He shows the Great Depression from the viewpoint of the world’s top central bankers: Schacht, Strong, Norman and Moreau. The book is excellent. It explains the problems of war reparations after the Treaty of Versailles, how Germany kept afloat using foreign capital inflows to pay its reparations and how the world economy stalled when finally these flows stopped. All the while, the tensions grow for the central bankers, which are on a kind of gold standard.
Ahamed takes us through the 1920s and into the 1930s by retelling the stories of the central bankers, their world views, their friendships and rivalries. This explains a lot about what happened and why. Looking back, the lesson of the book can only be that central bankers are not immune from the world around them, that they are not the cold-hearted technocrats as they presume to be, that they are human beings, children of the Zeitgeist.