Padoa-Schioppa, a former executive at the Bank of Italy, has sat on the board of the European Central Bank since its inception in 1998. In a book that is part primer on the new European monetary system and part reflective essay on matters monetary and financial, he provides an authoritative, well-informed account of the problems of modern central banking, seen from the perspective of one who has been intimately involved in the evolution of the European currency, and of the institutional arrangements required to transform national financial markets into a truly European market. Although he lacks the perspective that a critical outsider might bring, Padoa-Schioppa is far from complacent. Europe is between eras, with institutional legacies and practices of national central banks strong but increasingly anachronistic. Padoa-Schioppa thus foresees a gradual transfer of competence and authority to a more centralized but still regionally informed system, much like the U.S. Federal Reserve, in which the operational market functions are handled in one place on behalf of the entire system. For anyone interested in modern central banking, or in recent developments in the institutional aspects of Europe's financial system, this is a good place to start.