Dump trucks and time

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Joined: Mon 28. Feb 2011, 11:17
PostPosted: Mon 23. May 2011, 19:05
Dump trucks and time

How-gold-currencies can be manipulated
Before the Thirty Years War, the German empire saw a disastrous inflation. The empire coinorder of 1559 was incomplete and inadequate controls and their enforcement so poor that the manipulation did not open the door.
In this time flowed much gold and silver from Spain's colonies to Europe. Also decreased by a changing climate, the agricultural yields in Europe. In some areas, wages remained stable throughout the 16th century the same, but the price of grain doubled over the same period. The money supply rose, therefore, the GDP shrank. Thus arose and caused inflation. The country gentlemen had, as now, the modern states-a huge funding needs. They were allowed to dominate no imperial coins (coins, Gulden, Kreutzer, etc.), but any country coins, with a lower silver content. In order to meet their financial requirements, leased or sold their coinage rights to speculators. Seek to profit through manipulation of the coin for the silver fineness was thus set no limits.
The approach of the forger was as simple and effective: They stocked full coins, ie, the high silver fine value from the coinchanging, they melted or cut them, in order to characterize new coins with lower silver purity. This led to the concepts and dump trucks. The name says Tipper clipping the coins. Dump again were those who screened the full-value coins. The silver was replaced in part by cheap copper. The alloys are often referred to as high copper content, the new coins had a reddish appearance. That is why they boiled the counterfeiters in tartaric acid or silver amalgam until they assumed a silvery appearance. This process was called "white ebullition". After eight days, but disappeared from the silver sheen, but until then, the coins were already in circulation.
The Counterfeiters offered to the public to exchange large coins against inferior Coin plus premium. Thus, given the example of an imperial coins in some countries, 120 Kreutzer, although the official rate was 100 Kreutzer. The owner of Kreutzer made a profit as they could spend the money in a short period manipulated easily and without loss. Credits acquired from a forger in turn shaped the 140 "dilute" Kreutzer. The result is a competitive devaluation. Between 1600 and 1624 the value of a Kreutzer fell dramatically: it was necessary at the end of 390 instead of 76 Kreutzer pay for a dollar.
The prices of copper, silver and food went up dramatically, even though wages have stagnated of day laborers and the artisans of the only slightly increased. Sun rose in Munich, the price of a bushel of corn from 4 to 52 guilders 1617 guilders 1623rd This is an inflation of 1200% in six years.
The merchants and large bankers held back the "good" money and refused to accept low-quality cash. Since they do business anyway actuated only on the basis of crowns or gold ducats or even on credit, they were safe from price falls. The Debasement increasingly dysfunctional economic structure, and finally struck back at the perpetrators.
Only a financial reform in 1624 brought stability, but at the expense of broad social layers.

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