Chapter 1011: Promoting the Divine Shield
Chapter 991 – Promoting the Divine Shield
The benefits inherent in currency hegemony were known to everyone, but not many countries were qualified to participate in the competition. As the international trade settlement currency should have at least have the following basic conditions:
1. The economic volume of the currency issuing country must be large enough;
2. The volume of import and export trade of the currency issuing country must be large enough;
3. The currency itself exchange rate stability;
4. The currency issuing country has the ability to guarantee the payment of the currency;
5. If the currency issuing country itself is the world’s policeman.
In modern times, the first to meet these basic conditions is the British, so the pound became the first international currency.
Only limited by communication, economic globalization is not high, the pound in the promotion process is not smooth, in the international settlement is still more keen to use gold and silver.
With the increasing volume of international trade, pure gold and silver settlements have been out of fashion, the pound has come on the stage of history, became the earliest international currency.
Unfortunately, at this time, Britain’s economic hegemony is no longer solid, in the process of establishing the hegemony of the currency has been challenged by the franc and the shield.
Once an opportunity is lost, it is no longer available. With the passage of time, Britain gradually lost the advantage in industry, economic volume, the British pound’s dream of hegemony also ended.
Especially after the end of the Continental War, the Holy Roman Empire once again completed the unification of the Shield’s strong position on the European continent was established as the most favorable contender for monetary hegemony.
Advantage to advantage, before the dust settles, no one can guarantee that there will not be another accident. Franz, however, clearly remembers that there is still the Chosen Nation, which at this moment is practicing hard.
There was no way around it, the natural conditions of the Americans were simply too favorable. Basically all the resources were able to be self-sufficient, and even if it was divided into three, it still possessed the potential to become a top power.
Whether it was the United States, or the Union States, in terms of development potential both far exceeded Britain, France and the West. Especially the United States, the development potential even exceeded that of Russia.
The only flaw now is the population, and the lack of both quality and quantity has become a major constraint on the economic development of the two countries.
Although Franz made preparations in advance, while the Americans did not react, sent an untimely bomb over, but this thing will not explode, when to explode is an unknown.
Franz did not want to pin his hopes on the unknown, and instead of waiting for the challenger to develop, it was better to utilize the existing advantages to determine the general situation in advance.
Once the monetary hegemony is established, it is not so simple to overthrow it again. In later years, the old U.S. pattern of death, make countries suffer, the hegemony of the dollar is still not shaken.
The reason is very simple, is the rainbow effect. Currency hegemony brings together funds from all over the world, and with money, the speed of scientific and technological development is faster, and military hegemony is also consolidated.
One step faster, one step faster. Once the position of hegemony is established, it is like the Internet industry leader, in which the later is crushed to death.
Once the monetary hegemony of the Divine Shield was established, when the time came, “the only one who can play the Holy Roman Empire to death is the Holy Roman Empire itself.”
Economy Minister Reinhardt analyzed, “Your Majesty, if you want the Shendun to become the international settlement currency, then our economic model will have to change as well.
The biggest problem facing the divine Shield to become an international settlement currency is its external output. As the volume of international trade continues to increase, simply issuing international loans can no longer fulfill the demand.
In the early years, in order to minimize the loss of capital, we adopted the foreign trade balance model. For the past forty years, we had a trade surplus for the vast majority of the time.
It is not that such surpluses are bad. In fact, over the past years, we have relied on our foreign trade surplus to build up our family’s assets bit by bit and to develop.
But it would be an anachronism to break the pound and make the S.E.D. the dominant currency in international settlements.
In terms of currency export, the British are the best people to learn from. The way the pound is currently exported relies heavily on the British model of trade deficits.
To overshoot the trade deficit model, we would have to make trade-offs by reducing the amount of goods exported or increasing the amount of goods imported.
The Department of Economic Affairs believes that it is possible to give up some unimportant low-tech industries to other countries while we focus on developing high-tech industries.”
The issue of S.H.I.E.L.D. export has been discussed many times by the Vienna government. In order to better promote S.H.I.E.L.D., as early as twenty years ago, the Vienna government had been continuously granting international loans to countries around the world.
If there wasn’t the general background of exporting S.H.I.E.L.D., no matter how politically necessary it was, it would be impossible for an inferior customer like the Tsarist government to borrow so much money from the Empire.
How could it be that the speed of lending out was fast, and the speed of capital return was equally fast. As the world’s number one industrial power, all industrial and commercial products can be found here. Most of the debtors, after getting the money, before it was warm, took it out again to spend.
Needless to say, in this context, even if the Vienna government just want to trade balance, the end result will still be a trade surplus.
The result of the surplus is a large amount of capital influx, in promoting the development of the empire’s economy at the same time, but also hinder the development of international trade.
To put it simply, there was a massive outflow of gold and silver, and the trading partners became poorer and could not afford to buy more goods.
Knowing what you know, trying to change the economic model is not an easy task. One bad operation could bring about massive losses.
Now Franz somewhat understands why the Americans in later times played with de-industrialization. Labor dependence is high, pollution in the low technology content of the industry, is not the object of abandonment?
Waiting for the abandonment of almost, the insightful people only suddenly found – the country hollowed out. However, this time is already too late.
Competitors rely on cheap labor to develop, want to regain industrialization, the only way to speed up artificial intelligence research, rely on robots to do competition with cheap labor.
Franz does not know the final result, anyway, before he traveled, artificial intelligence has not yet replaced human labor.
“What industries is the Ministry of Economy prepared to abandon?”
Giving up some industries was inevitable, Franz was not an idealist. How was it possible to want to enjoy the dividends of monetary hegemony while not wanting to bear the fallout from it?
It was just that the specific industries to be given up were to be studied.
Economy Minister Reinhardt: “The industries that the Ministry of Economy is prepared to give up are mainly concentrated in the low-end manufacturing industry and non-renewable resource extraction.
The main ones are: mining of rare resources, textile industry, printing and dyeing industry, low-end clothing and footwear production ……
Considering the needs of domestic economic development and employment, it is obviously unrealistic to directly shut down these industries. In the short term, the measures we have taken are to strictly approve the registration of new mining and low-end industrial enterprises.
At the same time, we will cut import tariffs on products in the relevant fields and gradually phase out these backward production capacities through time and market competition.
If the plan goes well, we will step into the era of trade deficit in about five years.”
There were no core industries among those ready to be abandoned, and Franz breathed a sigh of relief. It seemed that the Ministry of Economy was still qualified and knew what was the foundation of the country.
If someone in the top echelons of the government really proposed to give up core industries, then Franz would have to think about whether or not to flip the table and change the way currency hegemony was fought over.
After all, this generation of leaders were all handpicked by him, and they were all so short-sighted, so much the more so that the future successors would not be expected.
Later generations of Americans engaged in industrial hollowing out, are looking at the rapid development of artificial intelligence, can be at some point in the future to pick back up, only dare to play that way.
Because of the error of judgment, the expected technological breakthrough did not happen, and people regretted it.
If you play like this in the 19th century, you can refer to the French in the original time and space, the monetary hegemony did not get, but also turned itself from an industrial empire into a usury empire.
With the previous experience, Franz naturally do not dare to take it lightly.
The same is to fight for the hegemony of the currency, in front of the government of Vienna, but there are two choices. The most lucrative, naturally, is their own personal battle; second best, Franz can also push the European Union out to seize the currency hegemony.
In a sense, the latter has a higher probability of success. In these days, when the power of the Continental Union is assembled, not to mention the British, even the whole world together is not enough to look down on.
The only problem is that the Holy Roman Empire, which invested the most, will not be able to obtain a high rate of return, and will probably only get slightly more now.
After a few moments of contemplation, Franz shook his head: “The economic model change brings a very big risk, we and the British are not the same, learn from it can be, follow the example is not necessary.
In order to be on the safe side, what we can do in the short term is to reduce mineral extraction, has been developed regardless of the mines, not yet developed mines should be strictly audited.
Which minerals must be developed, which minerals can reduce the development, which minerals can not be developed for the time being, the government should have a bottom in mind. Can not blindly mess around, affecting the domestic economic development.
It is best to introduce the relevant natural resources law to legally prohibit the export of mineral raw materials. Including coal and oil, these energy sources can also be temporarily included in the resource control list, strict approval of exports.
The low-end manufacturing industry strict audit, reduce capital inflows can be, the rest let the market to make choices, specifically targeted to reduce tariffs is not necessary, too deliberate instead of un-American.
In the short term, the government’s focus can be on pollution remediation, especially the local core area, the lake or river upstream of the heavy polluting enterprises, must be relocated or shut down.”
Comprehensive pollution control is unrealistic, not only do they not have that technology, but the Vienna government has even less money.
But to carry out a certain degree of fine-tuning, relocation or closure of some of the heavy polluting enterprises, Franz still has the bottom line.
Anyway, in order to promote the Divine Shield, the Holy Roman Empire to gradually enter the era of trade deficit, just take the opportunity to eliminate part of the heavy pollution industry.
In order to promote the Divine Shield, Franz also put up a fight. Even his own oil industry can be included in the resource control list.
Of course, this is also the limitations of the times, the international market demand for oil is not high, “oil – shield system” is even more of a shadow of a thing.
Moreover, restricting oil exports is not beneficial. On the surface, it is less money, but in essence, it is a blow to competitors.
As an important oil exporter, once the Holy Roman Empire to reduce the export of crude oil, the international price of oil will inevitably rise.
As a result, the promotion and use of the internal combustion engine is bound to be affected. Now is the critical period of the second industrial revolution, once you miss it will be difficult to catch up again.
Two birds with one stone, Franz does not mind sacrificing a little bit of money for the time being. Anyway, the oil is buried in the ground, and can’t run away.
(End of chapter)