Substitute currency is paper-based gold and silver, equivalent notes for real precious tals, and people’s trust in them cos from their trust in actual gold and silver.
However, credit money cannot be exchanged for gold and silver; its value is decoupled from precious tals, and its purchasing power entirely originates from the state’s "promise".
In this era, whether a state’s promise is enough to convince people that a pile of paper can replace money, and even entice international trade partners to recognize this, is the biggest issue.
"Your Majesty, perhaps you shouldn’t worry about this," Patrick understood what Gawain was thinking, "We have data and samples. Moreover, in my view, if we want to issue credit currency, now might be the best opportunity."
Gawain looked at Patrick: "...You an..."
"You once taught us the concept of national sovereignty, so I understand what you are concerned about—frankly, the nascent empire does not indeed have the prestige and appeal to fully implent a new currency decoupled from precious tals because most of our populace does not yet have a clear concept of the nation, nor do they have enough trust in the Administrative Office, let alone revere the ’imperial power’. However... you can."
Gawain was montarily stunned and couldn’t help but want to laugh: "You an, my prestige as the founding emperor is enough..."
He didn’t finish, stopping halfway through his sentence.
Perhaps... it really is enough.
Because those who just escaped the Anzu monarchy are still on their knees—even though the Administrative Office legally forced their bodies to stand up, the kneeling in their hearts is still pinned to the ground.
They might not understand what a "motherland" is, they might not comprehend the concept of the Administrative Office, they might not yet know the power of a nation, but fundantally, they still unconditionally revere the "monarch" and unconditionally submit.
This blind and backward status quo has always been regarded by Gawain as the greatest obstacle in building a new order, but if viewed from another perspective... it’s actually a situation worth leveraging.
"Your Majesty, your prestige and appeal are stronger than you imagine. This is not just because you established this empire, gained the allegiance of all nobles, and beca the overlord of every Cecil citizen today, but also due to nearly seven hundred years of propaganda that has almost deified the first pioneers," Patrick further explained, "To maintain their status and reinforce the ’noble lineage’s legitimate grounds,’ for seven hundred years, every Anzu king and aristocrat have spared no effort in promoting the glorious image of the early pioneers, significantly influencing the general populace. To so more superstitiously ignorant people, your resurrection is seen as a ’miracle,’ giving you very special and non-replicable influence among this group.
"Your Majesty, I know you have been trying to change this ignorant and backward situation, hoping to replace the old monarchical and feudal system with the Administrative Office and the nation concept, transforming the people from blindly obedient ’commoners’ into honorable and dignified ’citizens,’ but this is not sothing achievable overnight. Since it cannot be accomplished overnight, we might as well utilize this situation—without affecting the construction process—before reaching the final goal."
Gawain looked into Patrick’s earnest eyes and, after a brief contemplation, said solemnly: "There’s so logic to this—but we still must respect the natural order. Perhaps my prestige and appeal are strong enough to forcibly promote the new currency, but implenting it nationally still risks causing chaos. How do you plan to address this?"
"Progressively roll it out," Patrick imdiately responded, showing he had thought about this for a long ti, "Initially promote it in the southern borders, the Eastern Plains of the Holy Spirits, and the eastern regions. Among these territories, the southern borders are the most stable, the reform is relatively successful, and the populace acknowledges the Administrative Office. Coupled with the demo role of the pilot project, there’s no issue implenting the new currency; the Eastern Plains of the Holy Spirits is undergoing post-disaster reconstruction, equivalent to establishing a new order on ruins, so there’s almost no problem with old forces. Moreover, all comrcial activities in the eastern plains revolve around the United Reconstruction Group, entirely under the control of the Administrative Office, and the pioneering teams can build a complete and brand-new economic structure on the basis of the new currency; finally, the eastern regions... the eastern region is the most risky area among the three because it still retains a considerable number of old aristocrats, and the old currency system remains robust, but in any case, a breakthrough must be made in the east."
Gawain nodded slightly; although Patrick didn’t continue, Gawain knew the reason well:
Due to the fall of the Eastern Legion, the Loland clan’s disappearance, increased pressure on Longwind Fortress, and the eastern regions being essentially under complete military control by the Cecil Legion, the strong governance and the complete subjugation of the old nobility made the breakthrough in the eastern regions easier compared to the north and west.
Now is the best ti to completely reform the eastern regions, further dismantle the influence of the old aristocracy, and implent the new currency.
Once the breakthrough is made in the eastern regions, it will beco the best "sample" for the northern and western regions and the best "anchor" for further implenting the new currency.
"After completing this step, we will then gradually reform the currency system in the west and north," Patrick continued, "The populace will have a buffer period, and the nobility will have ti to realize the reality. Plus, the demonstration role of these three regions will minimize resistance to currency reform while already providing expertise, greatly reducing the possibility of turmoil in these two regions.
"While the empire is undergoing currency reform, our comrcial settlents with the tribal country of Augari and the northern states will still use gold and silver. Given the unique nature of credit currency, our international business partners will take longer to accept the new currency; therefore, in a longer period, we will maintain this mode of gold and silver settlents, lasting until a long ti after the empire fully popularizes credit currency. After this, we will gradually establish the new currency’s credit with the empire’s strong industrial power and trade scale..."
"You can be more straightforward," Gawain looked into Patrick’s eyes, "Make the surrounding countries dependent on our industrial products, unify the entire settlent area under Cecil standards, make our alchemical potions, rune triggers, and foundational industrial facilities the basis for social operation throughout the settlent area, and then start settling transactions with the new currency. During this process, we will also maintain the strongest military presence in the settlent area to ensure everything remains ’controllable.’"
"If it were Typhon, they would surely seize this process to amass half a continent’s wealth, which is their usual style..." Patrick couldn’t help but marvel, "How crazy it is to exchange paper for money."
"But it also puts all risks and redemption pressure on oneself and turns every country being ’fleeced’ into an enemy. Once those ’traps’ explode, every piece of gold and silver you seize becos like a ’bomb’ of Rebecca Crystals," Gawain shook his head, "We must let the whole world beco strong, not stand alone on a wasteland. We must always rember this."
Patrick solemnly lowered his head: "Yes, Your Majesty."
"Then there’s one more issue," Gawain took a long breath, "What do we use to define the purchasing power of the currency?"
The purchasing power of substitute currency originates from tangible gold and silver, which are valuable, making the purchasing power of substitute currency easy to asure, whereas credit money requires a man-made "anchor," and this anchor is crucial.
In short, it involves finding a relatively stable and indispensable commodity widely used in social activities, then letting the state dictate how much of this commodity a basic unit of currency can purchase.
In the initial phase of issuing credit currency, an anchor point must be used to determine its purchasing power.
"Use grain," Patrick suggested.
"Grain?" Gawain frowned slightly, "It doesn’t seem very suitable as an anchor point..."
"But we can’t find anything more suitable," Patrick said, "I initially considered using ’Magic Web Energy Value’ as the anchor, but magic is energy omnipresent in nature, and there are Transcendent individuals who can gather magic power using their own strength. The Magic Web, as an energy-gathering device, doesn’t qualify as an anchor point, and various forms of magic-conducting materials can’t be considered ’essential commodities.’ In many regions, especially more secluded ones, people can even go their whole lives without interacting with magic creations. But only grain... is a necessity in any era, in any region, and all we need to do is maintain price stability."
"... Ultimately, it’s about taking grain as the foundation," Gawain mused for a while, sighing as if talking to himself, "Then let’s tentatively settle on this plan, and you can handle the specific calculations and accounting."
"Yes, Your Majesty."
After taking a deep breath, Gawain felt his rapidly working brain finally starting to cool down.
This special and crucial negotiation is considered preliminarily concluded here, but as the starting point of currency reform, the things he and Patrick discussed were just a rough frawork. The repair and practical application of this frawork will likely require more people and more ti to perfect. But in any case, successfully taking this first step made Gawain breathe a sigh of relief.
Relaxing, his expression eased significantly, and his gaze returned to the desk, sweeping over the few "banknotes" on it.
"How is the current anti-counterfeiting technology performing?" he asked casually.
"The special ink formula has worked very well," Patrick said with a slight bow, "Based on Master Kal’s suggestion, we mixed trace amounts of special crystal dust into the ink. Under strong sunlight or near a Magic Obelisk, the banknotes can emit a specific floating light effect. Additionally, we acquired paper money from the Typhon Empire; their anti-counterfeiting thod is also worth referencing—they use fabric materials treated specially to make their banknotes, with the base material containing two magic silk threads. These threads are intricately woven to present specific shadow patterns under sunlight. Perhaps we can combine these two technologies in our coin production."
"No matter how sophisticated the anti-counterfeiting asures are, there will always be those who risk it," Gawain nodded, "Besides strict laws and punishnt, constantly updating anti-counterfeiting technology is also crucial. We need to ensure that the cost of most forgery actions is far higher than the benefits they gain from counterfeit."
"As you said," Patrick replied, "In fact, if an archMage devoted himself to forging currency, he could create counterfeit money that deceives everyone. But according to our calculations, the effort most Mages of this level would expend during counterfeiting would earn them over threefold the inco in legitimate industries—so rational Transcendent individuals are unlikely to engage in such a thankless task. If they establish teams and secretly purchase equipnt and materials for mass production, it would greatly increase the risk of cri exposure, which is still thankless. Currently, our anti-counterfeiting strategy is basically developed around this logic."
Gawain humd, then suddenly smiled: "One more thing... let’s make our banknotes as aesthetically pleasing as possible."
"Of course," Patrick smiled as well, "An exquisite currency is itself a showcase of technical prowess. Though they no longer represent real gold and silver... at least, when people receive them, they can still feel joyful."
Patrick left.
Gawain turned around and glanced at Amber, standing slightly behind him.
Unsurprisingly, the half-elf lady (who at least appeared to be a half-elf) was daydreaming, her gaze having been blank for quite so ti.
But as soon as Gawain shifted his gaze, she snapped awake, staring at Gawain wide-eyed: "Hey, you finally finished talking?"
Her ability to shut down her brain at will and instantly jump back to work mode is truly unmatched.
No one knows how she honed this skill...
"My goodness, I’m increasingly unable to comprehend your minds, especially yours," Amber, confirming Patrick’s departure, exhaled deeply, then started raving with hands on her hips, "I truly didn’t know these ’banknotes’ contained so many intricacies... That Patrick is a talent indeed; rarely does anyone get to discuss such topics with such fervor with you..."
"Patrick is indeed a talent, much beyond my expectation. I rely conveyed so concepts to him before, and he managed to understand and apply them to this extent. I think there aren’t many who can achieve that," Gawain gave Amber a glance, smiling slyly, "But you managed to notice ’so many intricacies’... that ans you also understood quite a bit."
"I don’t understand!!" Amber nearly jumped up, yelling almost hysterically, "Don’t trick into add..."
"Relax, this wasn’t part of your job anyway," Gawain shook his head, resignedly, "I just wanted to say, your intelligence gathering on the Highmountain Kingdom and Silver Empire was tily, keep focusing on that direction—because the Typhon Empire is also watching that way."
"Oh, rest assured, leave that to ," Amber patted her chest, looking proud, "Though I can’t send Intelligence Agency operatives that far yet, intelligence doesn’t only rely on espionage; as long as there’s communication across the continent, there’ll always be information."
Listening to Amber’s confident response, Gawain smiled lightly, slowly casting his gaze out the window.
The leaden gray sky had snowflakes drifting down.
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