Since the Accounting: A Chronicle of the Roman Khanate

Chapter 665: Can Carthage defeat Rome through a trade war?

After confiscating several warehouses, Guo Kang took the materials and began to conduct statistics on the spot.

These warehouses belonged to a big merchant in the city, and they were filled with all kinds of goods. The silk shipped from the East alone filled up an entire warehouse. However, when Guo Kang checked, he found that there was no clear record of gold and silver coins.

"It's strange, this guy just hoards goods but has no cash." He said curiously.

"Egypt has been short of money for years," Idris told him. "The gold mines in Nubia are now almost exhausted, and the amount of gold in the upper reaches of the Nile has been severely reduced. Mali to the west is also in civil strife, and the Tuaregs are constantly attacking trade routes, so the channels for obtaining gold from there are also beginning to have problems. As the precious metals have decreased, Egypt's local trade deficit has continued to increase, so the problem has become more serious."

"What did they buy to spend so much money?" Guo Kang asked, "Isn't reselling the silk profitable enough? The ducats and florins that were exchanged for these silks sold to Europe are also gold. Aren't the gold coins of the Crusaders considered gold coins?"

"That's not the case. It's simply too expensive." Idris thought for a moment and said, "Sultans and emirs need to buy slaves, and slaves are very expensive now. After you Romans cut off the source of slaves in the grasslands, the most important Cuman slaves were cut off. Later, when Timur went west, you intervened in the Caucasus, causing the source of slaves there to begin to decrease."

"However, in order to consolidate one's position and fight for power, buying slaves is always necessary. Therefore, even if the price is high, it is necessary to obtain slaves. Everyone is scrambling to pay more, and the loss of gold is even more serious."

"Buying slaves to this extent..." Guo Kang muttered.

"I've heard before that in the current market, a war horse costs fifteen dinars, a top-notch beautiful female slave costs ten dinars, and a talented warrior seedling costs at least sixty or seventy dinars." He calculated for Guo Kang: "This is just the children who have the hope of becoming Mamluks. Therefore, the cost of these slave warriors has always been very high."

"It turns out that beautiful women are the cheapest." Guo Kang suddenly realized.

"Of course, Mamluks can bring military strength and power, and war horses can help speed up the process." Idris spread his hands: "As for female slaves, they can only be used for fun. How can they be compared with these?"

"That's right." Guo Kang nodded. "This money probably flowed out of Egypt. But can't they eat up the money from the trade? Not really."

"Of course you can eat it, but the money may only be on paper, not in the form of gold coins in the warehouse." Idris told him: "You will know after you stay in Egypt for a while. Gold coins are rarely seen in the market here."

"In Egypt, copper coins are generally used to purchase goods. Firstly, the currency of gold and silver is confusing and it is difficult for ordinary people to use them. Secondly, the Mamluks also support copper coins. This is the most common method of local settlement. In many cases, gold coins have become a simple unit of account."

"In addition, because of the large amount of re-export trade, the currency exchange business here is very developed, but most currency exchanges are in the form of futures. Merchants tend not to pay with cash on the spot, but record it as a debt first."

"For example, after a merchant sold oriental goods to an Italian merchant, he received a batch of Ducat gold coins." He gave an example, "but the merchant would not deliver the gold coins directly, but would choose to receive them in the form of bookkeeping, and then find a currency exchanger from Italy to sign a contract. The merchant planned to continue to trade in the East in three months when the wind direction was right, so he asked the currency exchanger to give him a batch of Zhiyuan Tongbao in two months according to the exchange rate at that time. At that time, the currency exchanger would deliver the copper coins to him."

"Will the exchange rate change in two months?" Guo Kang asked.

"Yes, and sometimes the changes are quite big." Idris said: "When my teacher and I came back from Persia, we took a merchant ship from the Yuan Dynasty. There were also many people doing this kind of business there. But sometimes they would exchange banknotes, which was a little different."

"Because what is delivered is not cash but bonds, some merchants specialize in purchasing these exchange certificates and wait for the exchange rate to change in order to make a profit. In Cairo, there are quite a few people speculating on this stuff. Therefore, it is normal for these merchants engaged in commodity operations to not have cash in hand."

"These guys really know how to do business..." Guo Kang couldn't help but sigh again: "If they play this way, there is really no need for the circulation of gold and silver. They just need to exchange goods for copper coins in the end. This step is enough. But where can they get so many Yuan Dynasty copper coins?"

"They can mint it themselves," Idris said. "Egypt doesn't have much copper, but it has had reliable import channels since ancient times. The Yuan Dynasty also allows us to mint and use their copper coins, as long as the content and regulations meet their requirements. Of course, they also welcome us to bring copper ingots directly."

"Oh, I see." Guo Kang understood.

Sun Shiwan had told him about this before. The Yuan Dynasty has always pursued a free and open economic policy. As long as foreign merchants bring precious metals or goods, they are welcome. In the areas controlled by the Javanese regime, gold production is sufficient, but silver and copper mines are not enough, especially the copper needed for long-term high-intensity wars, which makes the local currency very tight.

However, the major families in Java operated many plantations, producing various spices, wood, and sugar. Their workshops could produce ironware, porcelain, and silk that were no less than those of the Ming Dynasty. In addition, the local area also produced various jewelry and rare items, and imported cotton from India for processing. These industries could bring high profits and form a huge trade surplus, allowing precious metals from other countries to flow into Java continuously, meeting various local needs.

In addition to precious metal currencies, each family also issued its own exchange vouchers and even general paper money for bulk trade. Previously, the central government of the Yuan Dynasty often couldn't help but issue paper money indiscriminately, resulting in serious depreciation, and the banknotes were like waste paper. However, the Javanese Yuan Dynasty was under pressure from the Nine Clans of the Ming Dynasty, and the major families also competed with each other. No one dared to exhaust all the resources and waste this useful fundraising method.

Therefore, those in power in the Javanese regime have firm faith in free trade and believe that as long as they can maintain trade, they don't have to worry about these things.

"But are you really going to take action against all merchants?" Idris hesitated while he was thinking, "The Mamluks are nominally the lords of various places, but they usually don't care about anything. Grassroots affairs are all handled by these tax farmers. If the Mamluks are asked to take charge now, they don't have any experience and may not be able to manage it."

"This is only part of the problem. Egypt's fiscal revenue is still very dependent on trade. If trade is cut off, even the precious metals mentioned earlier will be difficult to obtain. How do you plan to solve these problems?"

"We don't have to worry about management issues. We have rich experience in establishing organizations. The most troublesome problem now is that someone has occupied this ecological niche and prevented us from establishing an organization." Guo Kang said: "As for trade, it is even simpler. If they don't do it, there are people who will do it."

"Italian merchants have been asking us to give them a share of the pie. This morning, representatives of Javanese merchants came here in person. They want to establish a trading base in India and then cooperate with us to establish a transoceanic trade route. This will be a good replacement for Egyptian merchants."

"As for precious metals... According to our Roman experience, monetary security and a stable supply of precious metals cannot be maintained through trade."

"Is there any story behind this?" Idris asked.

"In the old Roman territory, precious metals are also scarce." Guo Kang told him: "In the early years, the Romans did not even have their own currency, and had been using other people's coins. Later, they minted 'As' as copper coins. But at that time, As was a very heavy copper ingot, very primitive. When large payments were needed, they would go to the southern city-states to order them. For example, the double drachma silver coin used by the Romans was commissioned to be made by the mint in Capua."

"Rome's agriculture was relatively strong, and its handicraft productivity was developing rapidly. It always had a surplus in trade with other countries. However, the Etruscan League in the north had close relations with Carthage, while the city-states in the south belonged to the Greek cultural circle. Although the Romans produced many commodities, their status in trade was lower than that of both sides."

"Due to the lack of a say in currency, it was difficult to control the economy with currency, and even to obtain precious metals and stabilize the currency value. In the end, the Romans were so short of copper that they could not even maintain their only minor coins. That copper lump was about to collapse."

"It was difficult to maintain currency, which meant that the pricing of goods could not be guaranteed, and exported goods had to be shaved off, which was equivalent to working for nothing. The Romans fumbled for a long time and finally found that war was the only way to solve this problem."

"In 280 BC, Rome attacked the Etruscan town of Volsini, a bronze-producing area. The Romans were desperate for copper and didn't even prepare excuses like oracles or covenants. Their main purpose was to steal copper. After the city was captured, the Romans looted everywhere and took away all the bronze artifacts. They even moved the bronze statues in the city and melted them down."

"Because the eating manner was so ugly, the Greeks recorded this incident and specifically said sarcastically that 'the Romans loved art' - in that era, this behavior of even dismantling the statues of gods for use was a bit too pragmatic, especially for the devout Greeks who believed in idols, it was even more unacceptable, so it became famous."

"But after that, the Romans also got their way. Wherever there were copper and silver mines, there would be legions. After the three Samnite Wars and the Pyrrhic War, the Romans had defeated other forces in Italy, gained control of the local mines, and were finally able to stabilize their currency system."

"At this time, other parties finally began to look at them in the eye. Because at this time, Rome had become Carthage's largest trading partner. However, at this time, Carthage still controlled the market and trade routes, while the Romans were still producing goods."

"The huge surplus generated by exports made the Romans hold a large amount of Carthage's debt. At the beginning, Rome was full of anti-war people. This had nothing to do with slogans such as peace or justice. In fact, the elders were afraid that the bonds in their hands would go down the drain, so they could not make up their minds to go to war with Carthage."

"However, when the war was forced upon us, we realized that trade advantage could not determine anything, and the other party's commercial sanctions were just a joke. When Rome defeated Carthage in the Second Punic War, it began to issue its own silver denarius - the currency with the same name that has been passed down to this day and is still used by you."

"So, sometimes we don't have to worry too much." Guo Kang said with a smile: "At least we have the military force as a backup, right?"

(End of this chapter)