An Age of Miracles Continues: The Empire of Rhomania

Yikes. This is... huge.

The worst-case scenario (which is all to likely IMO) is that this incident makes fiat currency less attractive and much more warily looked-at by the Romans. This would be... problematic.

Do the Romans have any major gold/silver producing areas? If not, the Romans might consider invading/colonizing some place with those, or otherwise finance expeditions to find such resources.
 
Yikes. This is... huge.

The worst-case scenario (which is all to likely IMO) is that this incident makes fiat currency less attractive and much more warily looked-at by the Romans. This would be... problematic.

Do the Romans have any major gold/silver producing areas? If not, the Romans might consider invading/colonizing some place with those, or otherwise finance expeditions to find such resources.
This is actually pretty much exactly what happened to the first experiments with national banks in France and I believe England as well at one point.

Trebizond and I believe parts of the Balkans have silver mines. Not sure about gold but Trebizond in particular derived a great deal of wealth from it's silver mines when it could protect them.
 

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The real problem is that Rhomania is in that bad spot between fully metallic currency and a truly fiat currency, not that metallic currency should be all that trusted as past debasement's have shown. This is especially a problem since Europe is likely still in a bullion crunch that isn't being alleviated by new world bullion to the same amount as OTL.
 
Yikes. This is... huge.

The worst-case scenario (which is all to likely IMO) is that this incident makes fiat currency less attractive and much more warily looked-at by the Romans. This would be... problematic.

Not only that, but if this outright ends fractional reserve banking in Rhomania then holy hell is that a problem.

Even limiting the equation to 3:1 long term can be a problem as the years go by.
 
Here goes another fiscal crisis that the Romans have to deal with, although I think this is probably the most damning out of all of them. Rhomania could shrug off some minor scuffles, but the total collapse of their banking sector? That's going to leave a lot of Romans destitute and this isn't something that the central government can recover from easily.

It does make sense though. A society deeply distrustful of the concept of paper money, lack of trust and confidence in the Imperial economy, and now a counterfeiting crisis? It could've only ended in complete disaster, especially in an era where economics isn't as understood.

This crisis does bring up something interesting though....where's all of that New World silver? Europe should be hitting a pretty big influx of silver due to Cerro de Potosi unless the Mexican government has been extremely lackadaisical about trading silver and gold for European or Asian goods. Japan or the homeland resources in Rhomania can still provide a good base for silver though.
 
Demetrios III has been putting all effort into finding a way firstly into distinguishing counterfeits from real IBCs, with absolutely no success. Secondly, he wants those responsible so he can make an utterly spectacular example of them. On September 19, Leo Sideros delivers an extremely detailed and confidential report to his uncle.​

Somehow despite all the posts over the past several years this one cliffhanger has me chomping at the bit with the most anticipation. You left it *right* there and now I'm really wanting to know, aarrrrgh
 
Here goes another fiscal crisis that the Romans have to deal with, although I think this is probably the most damning out of all of them. Rhomania could shrug off some minor scuffles, but the total collapse of their banking sector? That's going to leave a lot of Romans destitute and this isn't something that the central government can recover from easily.

It does make sense though. A society deeply distrustful of the concept of paper money, lack of trust and confidence in the Imperial economy, and now a counterfeiting crisis? It could've only ended in complete disaster, especially in an era where economics isn't as understood.

This crisis does bring up something interesting though....where's all of that New World silver? Europe should be hitting a pretty big influx of silver due to Cerro de Potosi unless the Mexican government has been extremely lackadaisical about trading silver and gold for European or Asian goods. Japan or the homeland resources in Rhomania can still provide a good base for silver though.
The bankruptcy of Law has left IOTL the French quite distrustful of Big Finance. But this is the Bankruptcy of Law, combined with the Assignat crisis, with counterfeiting on top !
 
How will Demetrios solve this issue? Are the Latins also experiencing some kind of money issues? I'm not an expert on economy 101 but this pretty bad so I hope that the next update immediately answers the problem.
 
Yikes. This is... huge.

The worst-case scenario (which is all to likely IMO) is that this incident makes fiat currency less attractive and much more warily looked-at by the Romans. This would be... problematic.

Do the Romans have any major gold/silver producing areas? If not, the Romans might consider invading/colonizing some place with those, or otherwise finance expeditions to find such resources.
There are silver deposits near Laurium, and gold and silver deposits in Chalkidiki, both of which are quite famous and have been mined since ancient times, so I'm sure Constantinople knows about them and will be developing them if they haven't already done so. There are also gold and silver deposits in western Anatolia, near Canakkale and Eastern Anatolia near Erzincan. Beyond this they also have gold in Egypt and I'm pretty sure they have precious metals in their holdings in Southeast Asia.
 
This crisis does bring up something interesting though....where's all of that New World silver? Europe should be hitting a pretty big influx of silver due to Cerro de Potosi unless the Mexican government has been extremely lackadaisical about trading silver and gold for European or Asian goods. Japan or the homeland resources in Rhomania can still provide a good base for silver though.
The problem with New World silver is that most of it isn't flowing into Rhomania at all. Mexico's largest European trade relations would, as a matter of course, be the Atlantic powers, so Rhomania's completely cut off from that.

In Asia, most of the Mexican silver that flows to Pyrgos isn't spent buying Roman goods, but Chinese goods. So the only money the Roman government gets out of this is the customs tax.
While that is still a lot of silver, it is hardly enough to satisfy the voracious appetite of the Roman government, which funds a huge top-rate army, fleets with two spheres of influence spanning half the world by longitude and massive civilian and military infrastructure projects across their vast empire at a time when the Latin rulers aren't nearly as invested in maintaining or upgrading non-military infrastructure.
Unlikd the OTL Spanish, who carted much of the silver home directly and could thus just throw money at any problem they faced for a good century.
 
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There are silver deposits near Laurium, and gold and silver deposits in Chalkidiki, both of which are quite famous and have been mined since ancient times, so I'm sure Constantinople knows about them and will be developing them if they haven't already done so. There are also gold and silver deposits in western Anatolia, near Canakkale and Eastern Anatolia near Erzincan. Beyond this they also have gold in Egypt and I'm pretty sure they have precious metals in their holdings in Southeast Asia.
There is some gold deposits in cyprus as well in the mitsero area aswell but i have not idea if they are minable with the current technology...
 
The main reasons are historical and psychological. The events of 1203-04 and the events leading up to those are the most intensely studied events in Roman history, to ensure that such a cataclysm can never happen again. And an important through-line in these studies is the granting of free trade rights to the Venetians by Alexios I Komnenos. The grant did not cause 1204, but it was an important enabler. To give anyone free trade rights is to give away a critical aspect of national sovereignty, and one that might not be easily reclaimed. When Ioannes II tried to revoke the Venetians’ free trade rights, they responding by raiding Byzantine lands and killing Byzantine people until Ioannes II gave in to their demands.

Free trade is opening a door that might not be able to be shut again, and the last time the Romans did so it ended up nearly being fatal. Preferential tariffs are possible, because the Romans still have that control over national sovereignty, but the Romans are not opening that door again.
Will Rhomania have more faith in some form of a single market between alliance partners? A customs union as the first step is easily palatable as it comprises common extenal tariffs only. An economic union including reciprocal reduction/minimization of tariffs, free movement of labor and capital and a common currency will be harder to accept.
 
Oh, economics, why do you excite me so :D That was a great update.

Considering this problem, and the only secure gold is for the army, I'd expect we're going to see mass-confiscations.

I'm curious @B444 are issued IBCs tracked with double-entry? If not that might start being a worthwhile introduction - there is still the problem of racing the distribution of updated ledgers to cash the same IBC twice.

That report from Leo though - considering what was said last time, there is going to be something ugly under the hood - and regardless of whether it is foreign or domestic, its gonna be AMAZING.

This does also change the potential aim of a war and gathering treasure in Mesopotamia, bolstering the gold supply in the Bank and the Palace.

No fiat currency yet though, whilst IBCs are monopolised, which is a major step to that, we're a long way off unless somehow the IB gets the reputation for utterly unfailing stability in the future.

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I'm a little concerned, the shelving of the replacements for the Green Fleets is a big deal, as that will limit Roman naval power significantly at home. Not a good thing.
 
There aren't a lot of Western European navies that can exactly take on Rhomania at their home turf at the Eastern Med. The Triunes and the Spanish might be able to contest them at their peripheries but the Empire itself? They don't have a large enough technological advantage to make an incursion worth it. Better to nibble at their important colonies and trade ports, which is honestly better economically for the Latins.
 
I have two theories for who might be behind the surprisingly accurate counterfeits, with very interesting geopolitical ramifications: one of the Despotates (Egypt seems likely) or Ethiopia, and possibly as a direct "response" to the crackdown on the tax avoidance scheme along the Red Sea trade route. It wouldn't surprise me if it were a sort of proto-assymetric warfare tactic employed by Spain or the Triunes, but narratively it seems like economic friendly fire is also a possibility.
 
I would bet money that the Triurnes have something to do with this.
Just don't make that bet in Imperial bank certificates...

In seriousness, oof. No real way past the fire except through it, and at this rate that seems to mean a rather massive contraction of the Rhoman economy. Coupled with Ibrahim's folly from earlier, it also looks suspiciously like a factor that could drive Odysseus in the future to some extremely kleptocratic actions against enemy territories (namely the Ottomans) in times to come.
 
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