Tell me your reason, Padrick. "Gwen looked at the Imperial Commerce and Finance Director in front of him with a serious expression." You should know that the implementation of a fiduciary currency is a relatively radical move, and if the pace of change is too big, it means that the difficulty and risk of the change will rise sharply. "
"Yes, Your Majesty." Padrick pressed on the collar of his black tuxedo, took a deep breath, and said slowly, "The main reason I made this suggestion is... Typhon."
"Typhon..." Gwen pondered for a moment. "Go on."
"Your Majesty, you once said that there will be a war between us and Typhon, and in my opinion, this war has actually already begun — I think you think so too. We have just avoided a real war, but in terms of economy, our contest has just begun, and at this stage, the essence of this contest... is a contest of gold settlement. "
Gwen looked into Padrick's eyes, he did not hide the approval in his eyes, and motioned for Padrick to continue.
"Typhon's substitute currency is based on gold, and their bank issues banknotes that can be exchanged for gold, but when it comes to orders with Cecil, because both sides have not established a new currency interface, we still settle with gold directly. We purchase a large number of textiles and other primary industrial products from Typhon, and at the same time export magical components, trains, and railways. The orders for the latter are small, but the value is huge, so overall, Typhon's gold is flowing to Cecil at a slow, unnoticeable rate.
"Your Majesty, you should know that Typhon's aristocratic reforms are far more 'moderate' than ours. They retain a large number of old aristocrats, and these old aristocrats, in addition to losing their privileges, still retain a large number of personal private property.
"In short, Typhon has a large number of aristocratic vaults that are not controlled by the royal family, and the gold paid to us... is actually gathered by countless aristocrats in Typhon through private investment, fundraising, and financing. Less than half comes directly from the vault of the Imperial Bank of Typhon, so for a long time, the people of Typhon will not realize that their gold is flowing out. This not only involves a very large and long-term statistical work, but also a large number of aristocrats are using all kinds of methods to circumvent the railway investment restrictions set by Rosetta Augustus, to hide the trivial but large-scale gold flow..."
Hearing Padrick's words, Gwen could not help but think of the situation that Daniel had reported to him.
In order to fight for a share of the benefits in the railway system, the small and medium-sized aristocrats of Typhon are trying their best to get involved in those projects. In order to circumvent the series of obstacles set by Rosetta Augustus, the most common method is to borrow money from the bank in the form of family guarantees or joint guarantees, and then "cooperate" with the bank (after all, half of the banking system in Typhon is in the hands of the aristocrats) to transfer the debt to Cecil Railway Investment Company. Then, in the form of repayment of the debt, they use their family's vault to repay Cecil's debt in batches, so that they can obtain shares and share the profits of the railway operation in various ways...
This complicated and "exciting" operation bypassed their supervision system.
Rosetta Augustus may be an Iron Fist Emperor with great talent and bold vision. He used palace struggles to successfully control the powerful upper-class aristocrats of the Imperial Typhon Empire and intimidated the small and medium-sized aristocrats in the country. However, in the corners of the gutters that he could not take care of, among the small aristocrats who were gradually turning from old aristocrats to capitalists, the "creativity" and "fighting spirit" of these people in the face of benefits clearly exceeded the imagination of the Emperor of Typhon.
In this way, Typhon's gold flowed out secretly and in small pieces.
"If we want to maintain this trend, the most important thing is to maintain the status quo of gold settlement," Gawain said slowly, following Padrick's train of thought. "And if we establish an alternative currency system, based on the law of economic development, it's only a matter of time before two countries establish a new currency interface, guarantee each other, and use the new currency for settlement. Once the currency used for settlement becomes the new currency, which is completely under the control of the bank, Rosetta Augustus can effectively control the trend of gold outflow. He may even discover the traps in the domestic industrial and economic development process in time, as well as the things we painstakingly arranged. With his wisdom, I'm afraid he'll be able to solve these hidden dangers quickly."
Issuing a credit currency to create a new currency settlement obstacle between Typhon and Cecil was a means to maintain the gold settlement between the two countries and delay Rosetta Augustus' reaction time.
"Yes, we want to 'help' Typhon's investors to keep this' golden shortcut '." Padrick nodded. "Of course, even if we choose an alternative currency, we can continue to ask for gold settlement. I support the credit currency for another reason.
"The people of Typhon will not only do business with us. They know that the goods produced by the factory need to be sold to generate value, and Cecil, as a country that is also developing the magic industry, will certainly not accept their exports, so they will definitely look for a new market..."
Just as Padrick said this, Amber, who seemed to be in a trance, suddenly said, "Typhon may be in contact with the Kingdom of Kaolin, and may be negotiating about the dispute in the Blue Rock area. If that is true, then the negotiations should be almost done."
"... They are preparing to trade with the Kingdom of Kaolin, and may even be eyeing the market of the Silver Empire." Gwen instantly thought of the answer, but then looked at Amber with a little doubt. "This is the information from the southern part of the continent. The Military Intelligence should not have infiltrated there yet, right?"
"I saw Sonia this morning, and she casually mentioned that the Silver Empire has recently been re-measuring the Blue Rock area. In addition, three days ago, the technical exchange document between the Silver Empire and the Magic Technology Department mentioned that the Magic Net units produced by Typhon can also be used in standard operating environments. Aside from the triangular area of the Blue Rock area, Typhon and the Silver Empire do not have any direct border or communication. The Magic Net units produced by Typhon are most likely from the Kingdom of Kaolin, and that may be the 'trade sample' that Typhon gave to the Kingdom of Kaolin. The three countries have been in constant conflict over the years, and basically, it all revolves around the Blue Rock area. Just now, I thought of these things... "
Amber said matter-of-factly, as if all this was just something she did casually in her leisure time.
However, Gwen's eyes were wide open.
After a moment, he withdrew his gaze and nodded with a smile. "Very good, you did well."
Amber crossed her arms, the tips of her ears twitching. "Of course, I am the Chosen One..."
"Your Majesty, it seems that the situation is as I expected." Padrick lowered his head and said, "Typhon is building a market in the southern part of the continent, and the Kingdom of Kaolin should have opened their doors to them. The Silver Empire will also establish a trade relationship with Typhon to a certain extent. Although we have a good relationship with the Silver Empire and also have technical cooperation, this will not stop the elves from buying goods from Typhon. On this basis, the large and small city-states attached to the Silver Empire and the Kingdom of Kaolin will definitely become Typhon's markets.
"Typhon will establish extensive commercial activities in the western and southern parts of the continent. In these areas, trade participants will use Typhon's currency to settle accounts. Except for the Silver Empire, which has the power to compete with Typhon, Typhon should be in a dominant position in economic activities in other countries.
"I call it the 'Typhon Settlement Area'.
"And what we are doing is similar to what Typhon is doing. We are expanding the scale of trade with the Augoray tribal country. You have already planned to build the railway to Augoray. In the north, Victoria, the Great Governor, is establishing exchanges with the Violet Kingdom and trying to contact the Duchy of Holy Dragon.
"Many city-states in the northern wasteland area have already started to buy our alchemy potions. Although their city-states are not large, the entire city-state federation is still a huge market.
"There is no doubt that the Cecil Empire will become the 'economic leader' of these areas, and these areas will be settled in our currency.
"Referring to the 'Typhon Settlement Area', most of the northern and western parts of the continent will become the 'Cecil Settlement Area'."
Padrick said so much in one breath. His face had unknowingly turned red, and his slightly plump body trembled slightly as he panted. In the eyes of this business and economic director, there was an inexplicable light flickering.
Gawain stared into Padrick's eyes, and unknowingly, his body leaned forward slightly.
"Then … this is not just a problem of Cecil and Typhon," he said faintly.
"Yes, Your Majesty, this is not just a problem of Cecil and Typhon. Typhon is establishing their settlement area, and we will certainly establish our own. This is a contest between two settlement areas and two currency systems. In the long run, in large-scale, high-speed, cross-continental, and rapidly growing commercial activities, credit currencies … have a higher 'capacity' than alternative currencies, and can withstand more disasters."
At this point, Padrick stopped, and Gwen said softly in a deep voice, "When the day of a run comes, alternative currencies will collapse faster."
Amber looked at Gwen and then at Padrick.
To be honest, although she had an outstanding talent in the field of intelligence, she was completely confused in the field that Gwen and Padrick were talking about.
However, she suddenly felt a chill run down her spine.
"As long as the Cecil Empire does not collapse, there is no international credit collapse, as long as our industrial and economic system is still developing steadily, as long as the Wall of Greatness does not collapse, and we do not do anything stupid like unlimited overpayment, then credit currencies are almost equivalent to having almost unlimited solvency." Gwen continued, "And the gold reserves of Typhon and his business partners will eventually hit a bottleneck, and the larger the market they build, the faster the bottleneck will come. The gears of the factory are heavy wheels that cannot be stopped, and this wheel will force them to overpay. What we have to do is to do everything possible to let the gold of Typhon's settlement area flow to us before Rosetta Augustus and the people of Typhon plug their loopholes …"
"May their noble investors continue to work hard." Padrick laughed.
Gwen also smiled. "May the current 'peace' last for a few more years."
He stood up and went to the place where the map was hanging next to the bookshelf.
The map of Ansu used to hang here, but now the old map had been taken down and replaced by a map depicting the entire continent.
The Gondor wasteland occupied an eye-catching position on the map. Around the wasteland, Cecil, Typhon, the Augulay tribal kingdom, the Kingdom of Kaolin, the Silver Empire … Every country was crisscrossed and occupied an ancient ancestral land.
For thousands of years, these countries had developed in peace and quiet. Although there was some communication, there seemed to be an invisible barrier separating all the countries.
For thousands of years, the protagonists of the story were Knight, the princess, the castle, and the wilderness.
Quiet, peaceful, and idyllic.
But times had changed.
Open the door, free trade.
His gaze slowly swept across the map of the continent. This map was personally drawn by him with reference to satellite images. Between the precise lines, his gaze gradually passed the Gondor wasteland and fell between the forests and cities of the Silver Empire.
"If only we could realize transportation between the north and south of the continent …"
"Your Majesty?" Padrick did not hear clearly and asked curiously.
"No, nothing." Gwen shook his head. The matter he was thinking about was not something that Padrick, the director of commerce and economics, could solve. "Let's talk about the issue of currency. No matter how necessary a credit currency is, it's not that easy to issue it. "
"Yes, Your Majesty."
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