Chapter 266: A Turmoil Begins

  Chapter 258 – A Storm Begins

Vienna Palace

Franz’s wedding has officially been put on the agenda. In this issue, can not be left to his own decision, the new Holy Roman Empire more than 50 million people are eagerly awaited.

The auspicious day must be chosen, in case the day is not good cloudy and stormy, is not it telling everyone that God does not like the couple?

In the case of an ordinary family, they would have to sigh at the bad luck, and in the case of a fanatic, they might even cancel the wedding. In the case of the royal family, it would be a huge political scandal.

Despite the fact that the influence of the divine power has been greatly reduced, this kind of superstition is still prevalent in the conservative parts of Austria.

After a group of priests, theologians and meteorologists, studied the matter, the date of March 12, 1855 was finally set.

The preparations had already begun, and Franz was obliged to make occasional visits to show the importance he attached to the marriage.

Marriage was a good thing, especially with someone you liked. Well, Franz admitted that he had average feelings for Princess Helen, but for an emperor, to be able to take someone he didn’t hate as a wife was considered happiness.

Franz’s good mood didn’t last long, and the thing that added to it came.

“Your Majesty, our plan to acquire gold has failed, the price of gold on the international market has skyrocketed by twenty percent, so it would be too much of a loss to continue buying.

After our investigation, we found that this increase in the price of gold on the international market was orchestrated by the British in order to block us from buying gold.” The finance minister said with a tired face

It was obvious that he should have not slept well for some days.

At the critical moment of the currency value reform, the British raised the price of gold and hindered Austria from buying, obviously with bad intentions. After this kind of thing happened, the pressure of the finance minister who led the currency reform could be imagined.

Franz frowned, under normal circumstances the British have no reason to obstruct the new Holy Roman Empire currency value reform, the gold standard system of the increase in the number of members of the gold standard system, is also beneficial to them.

“Have you found out the purpose of the British doing this?”

Franz asked, he didn’t believe that the British were doing this just to make a profit. If it was just to raise the price of gold and make a profit from it, then just make the unit price slow.

As long as the increase is not too large, in order to increase the gold reserves, the Vienna government also recognized?

All of a sudden raised twenty percent, such a disparity, idiots will continue to buy.

Forcing up the price of gold is not without cost. Speculate on the price of gold capitalists can win regardless of whether, but after the appreciation of gold, and gold linked to the pound also followed the appreciation.

This is equivalent to the pound at once appreciated twenty percent, such a large increase in the cost of industrial and commercial products in the United Kingdom naturally followed by a substantial increase in international trade to continue to maintain competitiveness will be difficult.

Is the British capitalists tired of living, ready to play themselves to death?

Until the end, Franz did not think that this is the London government planning. Doing so is to kill a thousand enemies and lose eight hundred, who would do something that harms others and not themselves?

Karl replied with a difficult face, “It is said to be to stop us from acquiring gold, so that we can’t raise enough gold for reserves.”

This argument, he himself did not believe. Austria was also an old empire, and the traditional underpinnings were still there. If the government was willing to pay the price, it was possible to raise gold reserves for the gold standard even within the country.

As long as the government’s credibility is high enough to gain the recognition of the market, even if the gold reserves are slightly insufficient, the same can be completed gold standard reform.

In the end the issuance of paper money, or rely on the credibility of the government, the Russians are the opposite example, they do not worry about the reserve is not enough, but they previously issued paper ruble or no one buy.

The British couldn’t just crush the market’s confidence in the new Holy Roman Empire, could they? If they had that power, they would have threatened the Vienna government with it during the Near East War.

Franz sneered and said: “continue to check, can not buy gold even if. Anyway, we have prepared for this, and the gold for the currency reform is already barely enough.

The rest of the shortage is not big, the big deal is to go to the countries that use gold and silver exchange, the British have the strength to raise the price of the European gold trading market, I do not believe that they have the ability to raise the price of gold around the world.

Still, it’s important to make a show of continuing to buy gold, so that the British can continue to maintain the high level of gold, and see how long they can hold out!”

The lack of information is the biggest drawback of this era, and in the ill-informed areas, the gold and silver ratio still maintains the same price.

To raise the global price of gold, unless the British maintain the high level of gold for several years time, or else many areas outside of Europe, simply can not react.

Franz would have laughed if Britain had done that. The big deal is that the gold standard reform will be delayed for a few years, and this is not urgent, a year late and a year early is not fatal.

Just do not know whether the British industry and commerce can hold out, because the increase in production costs caused by the rise in the value of the currency is bound to significantly reduce the international competitiveness of British goods.

Of course, the profits of overseas trade in this era are relatively large, Franz believes that capitalists risk so much for ocean trade, twenty percent of the profit is still there.

It was still possible to maintain the competitiveness of goods without raising prices. But for trade on the European continent, the profits might not be that great.

Even if the British are the world’s number one industrial powerhouse, it is not true that they can dominate in every field, and these industries can’t take the hit.

Franz even once gave birth to the idea of speculating on the high pound, the idea of striking the British industry and commerce, instantly and then he was extinguished.

On this Austrian capital, if the financial market and the British capital head-on game, the possibility of losing is almost nine layers of nine.

London

Granville cabinet dumbfounded, raise the price of gold is their work, but they are not prepared to raise so much at once ah!

According to the original plan, they only raised the price by a few points, so that the government of Vienna would know that it was difficult to back off and accept their conditions, but they were not prepared to let the price of gold soar so much.

Unfortunately, they ignored another group in this world – speculators.

Britain’s domestic capital is not a day or two, now the United States, Austria’s rapid economic growth, are inseparable from the help of British capital.

This time the government raised the price of gold, and it was again sought after, which did not rub off. The gold-silver ratio rose rapidly and then went out of control.

There are only two ways in front of the London government, either immediately sell off a number of gold, calm the price storm in the capital market; either devalue silver, silver prices fell, then the current high exchange ratio is normal.

One of the reasons why gold is now so hotly coveted is – the New Holy Roman Empire Gold Standard Reform.

Once the Vienna government completed the monetary value reform, the new Holy Roman Empire will certainly not hold so much silver, which flowed into the market, causing the silver price to plummet is inevitable.

Speculators are sharp, they through the hands of the most basic information, judged the future price of silver will fall, began to take action.

In a way, even if the government in London did nothing, this would still still happen, and a rise in the gold-silver exchange ratio would be the general trend.

This is not a good decision to make, and it affects the whole world.

Sell gold to calm the storm to stabilize the value of the pound, then hinder the Vienna government to buy gold plan is bankrupt, the future want to pull the new Holy Roman Empire to join their pound – gold system, is bound to pay a bigger price.

Of course it’s not without its rewards, the London government will make a profit on this action, which can make up for their broken hearts.

Let the silver devaluation should also consider the consequences, the most direct is the silver standard national currency devaluation, the reaction of the economy is the export of goods from these countries, will become more competitive.

Under this countervailing circumstance, it will affect the export of industrial and commercial products within the United Kingdom, which in turn will affect the British economy.

Prime Minister Granville anxiously asked, “What plans does the Ministry of Finance have to calm this storm?”

Without any hesitation, George Grey, the Chancellor of the Exchequer, gave the answer, “Your Excellency the Prime Minister, the best thing to do now is still to sell off the gold we have bought and let the market return to normalization.

This is the least impactful thing to do to the domestic economy, and since we bought it at a low price, we can still make a profit by selling it off now.

And it has to be quick, now that the government in Vienna still hasn’t given up its plan to buy gold, it’s simply irritating the nerves of the speculators.

It is very likely that they have found out about our plan and are now deliberately making an imperative stand just to see us laugh.

If it drags on longer and more speculators join in, it will be harder for us to quell the storm by then.”

The gold bought by the government and the reserve for issuing currency are two completely different concepts, and are even still carried out by two different systems.

In the era of the gold standard, the government can not take for granted the decision to reduce the reserves, or increase the reserves, these must be carried out according to the actual demand.

The consequences of acting rashly have been felt by the London government. A wrong signal triggers speculators to flock to the market, and the end result is disastrous.

Who let gold is a through hard currency, in many people’s opinion will not be a big depreciation at all, even if it is smashed in the hands, but also will not lose to where.

Hesitation again and again, Granville prime minister made a decision: “no matter what, are first to calm the gold price storm, stabilize the value of the pound.

The Ministry of Finance immediately began to sell gold, and domestic consortium communication, we need their help!”

Despite knowing that this is going to cost a lot of money, the prime minister of Granville still choose to seek the help of the consortium, otherwise I’m afraid it is difficult to rely solely on the power of the government of London to calm the storm in a short period of time.

It seems very comical, but it’s not nonsense, historically the British have done this, and not just one operational error, the final result is even more comical.

(End of chapter)