Section C Chapter 114: Dragon Treasury and Eurasian Currency (Beverly)
This guy ran ahead of me...... Beverly thought about the significance of the situation: Hmm......
"So, are you...... What do you want to do with me?" Salander seemed a little apprehensive. Pen | fun | pavilion www. ο½ο½ο½ο½ο½ο½ γ ο½ο½ο½ο½
"Before that, I want to tell you about it. The merchant smiled slyly: "Mr. Salander, do you know why the Eurasian Empire is still using the currency of the Eurasian Empire after the fall of the Eurasian Empire and the only thing left is the blockaded capital Sky City of Ellandi?"
"For ...... Why?" Salander's face was dazed, and at a glance he knew he was a little confused.
"You have an interesting question. Attracted by this topic, Beverly narrowed her eyes and became interested: "Then let me hear your opinion too." β
"To put it simply...... First of all, because the popularity of the original Eurasian currency is so high that trees are used all over the world. The merchant cleared his throat and began to speak decently: "If money wants to be universal, there is also a 'regime retention' thing involved." If the regime is quite strong, then precious metal currencies, which do not have to worry about depreciation, will naturally become popular. Because of the government's security, people also believe that the copper coins in their hands will not become worthless and can only be melted down. β
"So, since the Eurasian empire is in decline, what is the reason why there are still so many people using it? This goes back to the question of popularity that we just mentioned. With a gesture of spreading his palms, the merchant said mysteriously, "In addition, there is also a wide range of cultural influences. Although the Eurasian Empire, which was so powerful, is no longer what it used to be, its power is still there. It's as if dragoons are being trained now, and it is said that they were trained in the orthodox methods of the Eurasian Empire. β
This is impossible...... Beverly thought to herself: Except for places like the Holy Dragon Valley, there are countries that have not trained dragon knights in the orthodox methods of the Eurasian Empire.
"Is that all?" Salander seemed to understand.
"No, of course it doesn't work. Because the Eurasian empire ruled for thousands of years, its cultural influence was quite strong. The disintegration of the Eurasian empire took place gradually and in many directions. And those independent regimes trade with each other, and they all need a unified currency. The merchant pinched the gold hand pendant and thoughtfully said, "But do you think, in this case, even if they start to use the new currency of their own country, how will the exchange rate be calculated?"
"Just use the gold coins. Salander is getting more and more understood.
"That's right. Gold coins were used for trade between countries, because gold retained its value, while copper coins, which could only be used while the regime was still in effect, were useless. For this reason, it can be very troublesome to trade with different gold coins - before you need to know the gold content of your new currency, and then understand how many grams of gold actually are in each coin. After that, the exchange was carried out according to the proportional price of each other's gold coins - but this was a completely naΓ―ve ideal, and in reality the exchange rate was different from place to place. As a result, currencies that are almost acceptable to all people are used - they are all issued by some powerful country. The merchant took a sip of his wine and coughed.
"So needless to say, it's the Eurasian currency that people are using. In addition, new regimes often require large sums of money to consolidate, and for this they often find the world's largest neutral banking organization......"
"Dragon vault?" Salander suddenly realized.
"That's right. But if you think about it, most of the currencies in the Dragon Treasury are Eurasian currencies, right? When repaying, because if you repay the gold coins minted in your own country, the value of them will often not be accepted by the Dragon Treasury, which only accepts hard currency, so you will still repay the Eurasian currency. In this way, the Eurasian currency stabilized. β
In addition, the reason why the Eurasian currency is trusted is also because the gold content of these alloy coins has been stable. The degree of trust in the currency has a lot to do with the country's national strength. After saying this, the merchant paused slightly: 'In order to ensure that the Eurasian currency in its hand always has a stable and common value, the Dragon Treasury will also take many measures to prevent it from depreciating. β
"You mean that it is important to continue to issue gold coins with a stable gold content, which is the key to maintaining the value of gold coins. But ......" Salander seemed to think of something: "Didn't the Eurasian empire fall?"
"Nor can it be said to perish, but to decay. The main city is still there. Of course, there was no more money coming out. There are already too many Eurasian currencies in the world to count, not to mention that these currencies are kept in the Dragon Vault. In addition, it is said that the Dragon Treasury is still forging a steady stream of Eurasian currencies - this kind of behavior would not have been allowed before, but now Sky City has not moved at all, and no one can control them. The merchant laughed all over his face, "Mr. Salander, do you understand what I am about to tell you?"
"Uh...... Finance?" Salander hesitated for a moment.
"............" the merchant stroked his beard and muttered for a moment.
β............ So what?" said Salander, his face bewildered.
"No, I'm just thinking about what to say next. The merchant pondered for a moment: "In other wordsβMr. Salander, do you know how some people use exchange rates and the value of gold coins to make a profit?"
It seems that we have talked about the key place...... Hearing this, Beverly smiled knowingly: she understood what the man was trying to say.
"Why don't you exchange currency for currency at a place with a high exchange rate? After all, currency exchange rates are not uniform. After thinking about it, Salander replied firmly.
"In fact, there is a great deal of uncertainty in this practice, and currencies with excessively volatile exchange rates are often of little value in exchange. The merchant smiled again: "So, Mr. Salander." What would you do in this situation?"
"What's the situation...... Salander's face was full of confusion: "Is the currency too volatile? β
"So, Mr. Salander, you don't have business acumen. The merchant was still full of mystery: "In this case, it is necessary to exchange the currency, which is likely to depreciate each other, for goods." β
"Goods...... What's the difference between that and ordinary business?" Salander was still confused.
"It's a big difference, actually, ......" Looking around, the merchant suddenly said to Beverly mysteriously, "Hmm...... This young lady, can you please put a silent barrier?"