industrial lord

Chapter 637: Preparing for Paper Money
"Things have their priorities. There's no rush. There's no rush."

"Once the shipyards in Hanma City and Lugang are built and produce enough warships and cargo ships, we can go south to look for gold."

Frederick finally managed to calm Maria and Susan down.

Hundreds of tons of gold are enough to drive people crazy. The news spread among the high-ranking officials of the Principality of Wessen, and many people asked Frederick openly or secretly when to take action.

The 2nd Division that remained in the Principality of Wessen and the newly formed 4th Division began to gear up and compete for the qualification to grow out of the gold mine.

Frederick had to repeatedly emphasize at the Supreme Ministerial Meeting that this matter could not be rushed.

At present, the maritime forces of the Principality of Wessen are mainly used for logistical transportation to the Western Front Corps in the inland sea and cannot be freed up.

Moreover, after the Flying Tulip was converted to propeller drive, its keel had some problems due to the stress, so it was ready to come back for a major overhaul or even be retired.

At present, the development direction of seagoing ships will be 500-ton steel keel wooden hull ships, focusing on one model, and on this basis developing cargo ships, passenger ships and warships.

Due to insufficient technical background, we can only continue to make trials and improvements.

The most important thing at the moment is, of course, to issue paper money to alleviate the shortage of precious metals and to make plans for the Bohemian region.

Giovanni now serves as both the president of the Wessen Bank and the deputy minister of the Rhine Confederation's postal department. He spends half of his time managing the Wessen Bank and the other half using the Rhine Confederation's postal system to extend the Wessen Bank's tentacles to all directions.

If Frederick wanted to issue paper money, he had to reach a consensus with him first, otherwise it would be disastrous if there were problems in implementation.

After listening to Frederick's plan to issue paper money, Giovanni nodded and said, "Now not only large transactions, but even small transactions among citizens are beginning to reduce the use of metal currency."

“Bearer bills are used for large transactions, and stamps are even used for small transactions.”

Frederick could understand that metal currency was too heavy, not to mention that when he traveled through time, he didn't even carry paper money. He just had a mobile phone in his pocket. He only used paper money to give red envelopes at weddings and funerals and to give red envelopes to younger generations during the Chinese New Year.

At present, Frederick's biggest headache is whether to issue paper money based on the gold coin standard or the gold bullion standard.

Although both are gold standards, there are still differences between the gold coin standard and the gold bullion standard.

Under the gold standard, gold coins still circulate according to the law, and paper money circulates at the same time as gold coins as a subsidiary currency and can be freely exchanged for gold coins at their face value.

Doing so ensures that the nominal value of banknotes is consistent with their actual value, and that domestic value is consistent with international value, which is conducive to people's acceptance of banknotes and the development of the domestic economy and international trade.

Under the gold bullion standard, gold coins are no longer circulated in the country. Only paper money linked to a certain gold content is issued. There is a minimum amount limit for exchanging paper money for gold bullion. For example, a minimum of 10 kilograms of gold can be exchanged at one time.

The gold bullion standard can "save gold" and avoid a large outflow of reserve gold while ensuring that paper money is pegged to gold. It can also solve the consumption caused by natural and malicious wear and tear of gold coins.

From a national perspective, Frederick agreed with the gold bullion standard, which would effectively control the domestic circulation of gold and ease the pressure on gold supply.

But Giovanni considered from the user's perspective that suddenly abolishing gold coins and replacing them with paper money would cause economic turmoil and might even lead to disaster.

Sometimes solving political problems is a process of mutual compromise among all parties, and on this issue, both sides can only take a step back.

Finally, Frederick and Giovanni discussed and decided that, in principle, they would first implement the gold coin standard, and then gradually adjust it to the gold bullion standard based on the situation reflected.

Next, there is another question. There are three precious metals used as currency now: gold, silver and copper, and the exchange rates between them are dynamic.

So, will the corresponding paper currency only use gold, or will different metal currencies correspond to different paper currencies, and the convergence between paper currencies will also change at any time.

After thinking for a while, Giovanni said, "I think it is best to exchange it only in gold. The life of paper money is credit. If it changes frequently in the early stage, it will reduce trust."

Frederick nodded, but a new problem arose.

If the unit is the gold florin, assuming that a 1-florin banknote is needed to buy 1 ton of wheat, then a citizen would have to use a 0.0005-florin banknote to buy half a kilogram of wheat. People add zeros to the back of the banknotes, not to the front.

If the yuan, angle and minute mode is set, update problems may occur.

现在是1枚弗罗林金币=20枚克罗伊茨银币=2000枚铜板，金币和银币间是1:20，银币和铜板间是1:100，市面上还有更小的铜板和铜板。

If we want to set up yuan, jiao and fen, which one is the yuan and how to exchange them with each other.

Frederick and Giovanni discussed for a long time but could not come to a conclusion, so they could only investigate the private consumption situation.

The Supreme Council of Ministers has established a "Currency Usage Investigation Committee" to ostensibly investigate currency wear, chipping, counterfeit currency and other issues that occur during transactions. The survey form can be used to learn about the currency usage by consumer groups at different levels.

Many families in towns have the habit of keeping accounts, and the Supreme Ministerial Conference has compiled statistics on residents' account books on the pretext of investigating people's living standards.

At the same time, Frederick spread the word that he was inspired by the recent incident of the Meyer couple's 100,000-pound bill of exchange, and planned to relax the restrictions on low-denomination bearer financial bills for daily consumption circulation.

While Frederick was waiting for the results of the investigation as a basis for his policy, someone else had already done the next work.

Psyche placed a stack of bills and a machine on his desk.

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"Banknote anti-counterfeiting technology display and money counting machine." Psyche said, "Take a look at it."

Frederick was not surprised by the anti-counterfeiting of banknotes, because relevant technologies were used in bills of exchange. Whether it was cotton paper, watermarks, colored fibers, rubber security threads or engraved gravure printing, they were all relatively mature, and more efforts needed to be made on inks.

The problem is the money counting machine. I didn’t expect to have a sample so soon.

This money counting machine is hand-cranked and has a somewhat complicated structure. A stack of banknotes is put in and it starts to rotate. There are five finger-thick rollers with vertical stripes on the large turntable that will push the banknotes away one by one. After the banknotes are counted, the stripes on the rollers will be stuck by the convex teeth on the bottom plate pressed by the spring, and then the numbers can be read.

Psyche said: "This money counting machine is used to count meal tickets in factories and schools. The prototype is a machine used in paper mills to count the number of sheets of paper. However, it can only count the number of sheets and cannot distinguish the authenticity."

Frederick nodded and said, "That's enough."

After he said that, he picked up the colorful banknotes and his face suddenly turned dark.

The pattern on the front of the banknote is very similar to the one in his hometown. His face is on the right, and the blank space on the left is the watermark. The lines on it are extremely thin and complex, exceeding the existing bills of exchange, and can even be printed in four colors.

The problem is that the pattern on the back says "Grand Duke Wessen (second from the left) taking a photo with the top three in the competition", and there is an extra pig on the far left, so Frederick is right in the middle.

Frederick asked, "Why use this pattern?"

Psyche replied in all seriousness: "Five pigskins."

Frederick thought for a moment, frowned, and said, "Is it appropriate to use Chinese homophonic puns in this world?"

Psyche didn't take this up, and asked, "Have you ever thought about what the banknotes will be issued under?"

"It's definitely not okay to just call it a currency. Just wait for a run on it."

Frederick shrugged and said, "Then issue it in the name of bearer interest-free bonds of the Duchy of Wessen. It can be used to pay taxes, deposits, pay fines, and exchange for gold at the Wessen Bank, etc."

"Well, then I can try it out in the factories I own shares in and create momentum."

"By the way, find some more to exchange for gold."

(End of this chapter)