They say money is the root of all evil. That’s debatable, but one thing that’s not is that money and its attendant enterprises—buying, selling, lending, borrowing, credit cards, the stock market and banking—is an inescapable component of the fabric of modern life. How did this come to be? Money and the complex system that makes it work is a man-made product that we invented and yet, like Frankenstein, it has us all in its grip. From the poorest to the wealthiest, we worry about money.

This highly accessible and easy-to-read synthesis of complex subjects asks some of the obvious questions about money and finance that few of us stop to think about.

For instance, what is the real “value” of money? Well, astonishingly, nobody agrees. But most people seem to accept that it is lent into existence by the commercial banks. When you stash money in the bank, they must keep around 8 percent of that loan on deposit—in case there's a run on the bank—but all the rest is lent out again many times over. In other words, most of our mortgages and bank loans are created as if by magic by a stroke of the pen.

That's the strange truth behind modern money. We don't mine it, we don't find it on a beach, it bears no relation to anything real, but still some people have vast amounts of it and some people have none at all. And we hardly ever talk about it.