This title covers the History of Money and reflects upon Empires that had access to gold and silver to strike coins to increase their money supply, help trade, and pay for arms and mercenaries to their project power. Empire status was assured by having a stable gold: silver ratio or paper notes backed by gold coin. The use of paper notes - first issued by the Song dynasty, in China c910, and Kublai Khan's paper is covered in depth. Historically all paper notes (and debased coin) have become worthless - the question is how fast. It took 500 years for the silver Roman denarius coin to be debased and it has taken 100 years for the Fed's US dollar to lose over 96% of its value.
Diverse historic events relating to gold, silver, coining, money, mining, banking, financial panics, epidemics, black swans, and the survival/devolution of Empires are covered.
Topics such as:
- Unexpected "black swan events" that change the direction of an Empire - as when pirates attacked Ostia, Rome's ancient port, burnt the consular fleet, and kidnapped some Roman senators. This led to Pompey "the Great" to be given unlimited power to fight the "War on Piracy". His expansive activities destabilized states (Asia Minor, Syria and Parthia, Judaea, etc.) and aggravated social tensions between the elites and plebs (populist mass) in Rome. Class tensions/civil wars had already been going on for over 60 years. Pompey also controlled Rome's grain supply. Pompey supported the elite and came into conflict and lost to the populist Jules Caesar. Caesar struck propaganda coins with the gold and silver he amassed during his campaigns in Gaul and Iberia.
- Athens, at the peak of its Empire, imposed strict demands/fines/sanctions upon its allies. They had to pay arbitrary annual tribute in Athenian Owls. If they used their coins or silver ingots in payment they were undervalued to be re-struck as Owls. Sanctions were imposed for perceived infractions where all their citizens could be killed or the walls around the "offending" city were torn down. Athenian colonies were established adjacent to ally's gold or silver mines. Athens' hegemonic activity triggered The Thucydides Trap resulting in the devastating Peloponnesian War, with Sparta. This led to the collapse of the Athenian Empire, dominance by Persia, assent of Philip II of Macedonia (coining gold Philipperioi to bribe/lobby Greek city state political factions), and Alexander the Great's invasion of Persia where he seized vast amounts of gold and silver. Alexander's and his successors' coining increased their money supply producing prosperity/inflation lasting over 100 years.
- Britain had a massive trade imbalance with China. In the early 1800s China had over 30% of world's GDP. Britain was on an effective gold standard while China was on a silver standard. Britain had to buy silver, in Europe, at a high price to pay for its tea, china, silk, etc. imports from China. To resolve this monetary crisis Britain started to grow opium on its forced-labor plantations in northern India. The opium was smuggled to China in exchange for silver. Opium, illegal in China, was seized and Britain demanded a stiff indemnity for its smugglers. China, citing national jurisdiction, refused to pay. Britain as a hegemon ruling the seas (and making the rules) initiated the Opium Wars. Britain, following Pompey's example, had already been boarding foreign ships by claiming they were harboring pirates or illegal goods. In the late 1830s, Britain (the sea power) invaded Afghanistan (in The Heartland). The hill tribes annihilated the Army of the Indus (20,000 troops + 38,000 helpers). A British surgeon, who escaped on horseback, was asked where was The Army; to which he replied, "I am the army."
- Domination of Land Power over Sea Power Empires as seen by Mackinder's Heartland and Mahan's Sea Power Theory is highlighted. These ideas are still being contested.
This title is of interest to anyone who is trying to comprehend the current state of affairs as it covers topics such as hegemony, populism, The Heartland power-base, banking domination, post capitalism, end of money, Bitcoin, and Facebook's LIBRA that will "help the poor without access to banking services."
