OCR Text |
Show MONEY PROBLEMS OF LONG AGO Romans Had Their Troubles, as Did Other Nations, in the Adjustment of Currencies to the Demands of Trade and Public Welfare. The Romans were slow to get a coinage system. Three hundred years after the founding of the city, far advanced In many respects, Romans Ro-mans were trading like a tribe of aborigines, Reuben Calm writes, in the Chicago Tribune. They were quoting prices in sheep and oxen. The two were related in a decimal system K) sheep equaled 1 ox. In Etruria. which lay northwest of the Tiber river, were copper mines and at an early date copper was brought to Rome. It came to be used In shields, harness, wagons, ships, and for many other purposes. Thus Is had a market value and it became the custom to use lumps of it In making mak-ing payments. The government paid no attention to this innovation, however, how-ever, for some years. At a time when pieces of copper were being used In trade a souse driving hrs chariot recklessly along the Applan boulevard boule-vard might have to settle with the Judge by driving up a flock of sheep. Since copper was sold by weight, It became convenient to have pound lumps called an "as." There were also two and three pound pieces. Thus copper served as money before the state started issuing pieces of metal stamped with picture of the gods, mythical heroes, and contemporary contem-porary politicians. When after 3G6 B. C. the Romans became commercially ambitious and founded a maritime colony they took up coining. The money was bronze, lead, and tin, being combined with raw copper. The unit of value weighed an as and was called by that name. Silver, which the Roman generals found desirable to have on hand to buy army equipment as they went on conquests and which was already widely used elsewhere, thanks to Greek and Alexandrian influence, became be-came official money in Rome after 2G9 B. C. Thereupon the double standard was adopted, silver and copper cop-per both being coined and a mint ratio of 120 to 1 was established. Although Al-though silver was used exclusively in the foreign trade, copper continued con-tinued to constitute the principal money at home. Now silver greatly increased In quantity. For one thing, Alexander discovered enormous treasures of both gold and silver in the Orient and set them in circulation. And there was the great silver mine in Spain, which at one time employed 40,000 miners. This had the effect of cheapening silver: boosting prices in terms of silver. At the time when wars had cut off the supplies of Rome's copper, the value of that metal in relation to silver rose more than did the general commodity Index In-dex number. And furthermore, copper cop-per was a commodity useful to have around while warring. Roman statesmen well understood Gresham's law 18 centuries before Gresham : with a double standard, an Increase in the supply of silver, being coincident with a reduction In the supply of and an increase in the demand de-mand for copper, would have led to the hoarding of copper as money. If the double standard was to work, It was necessary to reduce the mint ratio from 120 to 1. And so the size of the coin "as" was changed from 12 ounces of bronze to 10, 8, 6, and eventually to 2 ounces. Thus, the relation re-lation of silver to copper fell as low as 20 to 1 while the normal sources of metal were unavailable. When the peace-time flow of new copper was re-established, and the war-time demand de-mand was cut off, the old ratio of 120 to 1 was restored. Copper and silver performed similarly In the World war. The market ratio was 30 to 1 in 1917 now is 7G to 1. Devaluation of copper was not undertaken un-dertaken by the Roman republic at any time for profit nor to relieve the burden of debtors, the ends sought by gold devaluators today. It was done to maintain the double standard. It was the earliest example exam-ple of a successfully managed currency. cur-rency. On the ides of March, 44 B. C, the great Caesar was slain. After him came emperors n-h the republican precedent to l the currency as a racket, J-N value was but one-fiftieth 'of il ,J was before. a!t The history of money n (v man republic was a succession ' P" adjustments to make a double si'"' ard work. That the republic plied its citizens with a soun,i 3 honest medium of exchange is . mony both to their ability and n character. V |