I graduated in 1987, the year the deregulation of the financial services industry and the City took hold, the year after Nigel Lawson’s “Big Bang”. Looking back, I’d argue that was also the year in which parts of Britain, particularly in the south-east, particularly in the City of London and in the new towers of Canary Wharf, began routinely to describe the world with a new language, what John Lanchester calls the language of Money. The lexicon of economics had, from Adam Smith on, always had a significant place in British political and cultural life, of course, but suddenly its inflections seemed to permeate everything. Back then, friends, seduced by improbable starting salaries, or simply the prospect, post-recession, of regular employment, disappeared to the world of bond markets, and leveraged buyouts, making good, perhaps – or, in that antique phrase, selling out – and developing the language to justify it.

In the 20 years between that moment and the financial crash, the rewards within those industries, as we know, and the products and services they offered, multiplied exponentially. The practice and language of the economy became first Americanised, and then globalised, and the money-tongue became an increasingly convoluted and specialised argot, in part designed to lend the sharper habits of the City a veneer of science. Jargon can ornament all manner of sins, and as fast as it was creating ever more elaborate get-bonus-quick schemes, the world of finance was generating euphemisms to describe them.

At the time of the crash John Lanchester developed the sense that we had come to live in two cultures, and that the new divide was not CP Snow’s old schism between science and the arts (we’d mostly given up on reconciling that one) but between those who spoke the language of money and those who didn’t. For a long time, as the economy (or the debt bubble) grew, this had not seemed to most of the population a gap worth closing. We put our collective faith in the idea that those phrases that peppered the margins of the news, “consumer surplus”, say, or “derivative markets”, or “supply sides” and “bond yields” were fully grasped and in the control of somebody, if not necessarily, quite, by us.

Economists and bankers had something of a mystique in the media, in that they understood, or appeared to understand, complex maths; the language by which they maintained that mystique meant, by 2008, that they never had to confront the fact, perhaps even to themselves, that the numbers didn’t add up. It became, anyhow, Lanchester’s apprehension, and then obsession, that “just as CP Snow said everyone should know the second law of thermodynamics, everyone should also know about interest rates, and why they matter, and also what monetarism is, and what GDP is, and what an inverted yield curve is, and why it’s scary”. Not to have that understanding was a democratic deficit: if you did not know what the words that described the system meant, how could you argue that it was broken?

With the financial crash it seemed likely that the former blind faith in the prophetic and analytical capacities of economists and bankers would necessarily crumble. One of the most shocking aspects of the post-crash political consensus was that everything apparently had to be done to restore that faith as soon as possible, and one aspect of that was to make the language of money much more involved in how we described the world. Since 2008, no Today programme story has seemed complete – be it about sport, or education, or theatre – without a filter of austerity politics and a price tag. The need “to speak money” even if to understand the point at which speaking money is beside the point, has never seemed more urgent.

Ever since the crash, Lanchester has made it his mission to try to translate between the two cultures, first in a series of celebrated articles for the London Review of Books, and latterly in his books. He had an inherent imperative to follow this vocation. Though he had pursued a career in literary journalism, and fiction (and sports reporting and restaurant reviewing), Lanchester had grown up the son of a banker in Hong Kong. Not, he insists, the pejorative kind of banker with whom we are now familiar, but the old paternalistic kind: supporting small businesses, overseeing steady and prudent investment, watching the pennies, all that. He had, anyway, a sense of discordancy in how the language of money used to sound and how it now sounded. At the time of the crash he decided to educate himself in the ways of the globalised City, and how they impacted on the lives of the 99% of citizens. The lessons of that education he communicated beautifully (and with great jokes) in his book Whoops! Why Everyone Owes Everyone and No One Can Pay, which can be placed alongside the books of Michael Lewis as one of the defining efforts to explain the financial meltdown to a wider audience.

Lanchester has a gift for making the abstract world of large numbers concrete. By the beginning of the current decade we had become used to seeing zeros everywhere we looked, one extra hardly seemed to matter. Whoops!, among many other things, put you right on that: a million seconds is just under 12 days, Lanchester reminded you. And a billion? That’s about 32 years.

In his subsequent novel, Capital, Lanchester made a spirited attempt to show how the vast inequalities rooted in those noughts played out in the lives of the residents of a representative London street.

His new book acts as a kind of glossary for those previous volumes. Ambrose Bierce’s Devil’s Dictionary feels like one antecedent of How to Speak Money (I always loved Bierce’s definition of “economy”: “Purchasing the barrel of whisky that you do not need for the price of the cow that you cannot afford”.) Lanchester’s lexicon approaches his subject in something like that mischievous spirit, but is also on a more duly diligent mission to explain.

Sandwiched between enjoyably baggy state-of-the-global-economy essays that take in everything from the (successful and underreported) pursuit of Millennium Development Goals to the digital contraction of the newspaper and publishing industries, he offers a compulsive gloss on an A-Z of financial terms, with a paragraph or three in explanation of each. Everything from “mortgage” (“Literally ‘dead pledge’, and if it were called that maybe more people would think twice about getting one…”) to more arcane terms like the “Laffer Curve” and the “Vix Index”, is subjected to his Johnsonian attention and wit. Mostly Lanchester retains his sense of the informed sceptic in this labour (just occasionally, enthralled by the sheer geekiness of the subject, he sounds of the devil’s party without, apparently, knowing it). In conclusion he suggests that “one of my ambitions for this book is that it’ll make readers want to go and read more about money and economics”. It may; but if you only want a short course in financial linguistics and the way they shape our world, this volume will do the job just fine on its own.

How to Speak Money is published by Faber (£17.99). Click here to buy it for £13.99 with free UK p&p