The current monetary system of the Lemurian Empire was established by a great emperor who put down a centuries-long civil war.
　When the great emperor who built Nova Lemuria issued the Lemurian gold coin, the gold content of the coin was 95.8%.

　This was no exaggeration to say that it was the highest purity in the world at the time.
　The highest purity Lemurian gold coins issued by the Lemurian Empire, which was still a powerful, if declining, nation at the time, were quickly used around the world. ......

　It became the reserve currency.

　However, as time went on, ......
　A problem arose.

　A shortage of currency.

　This was because as the economy of the Lemurian Empire grew, the demand for currency increased, but the supply of currency could not keep up.

　As a matter of course, gold coins are made of gold.
　The gold is mined from gold mines. ......

　Gold mines are not so generous as to increase the amount of gold mined in line with economic development.
　In fact, the amount of gold mined will diminish.

　The gold mines of the Lemurian Empire can still be mined. ......
　The amount of gold that can be mined is constant year after year, and it is obvious that it will run out at some point.

　In addition, metal coins wear out little by little every time they are used.
　Some people are clever enough to try to make a profit by scraping the edges.

　Gold inevitably diminishes in value.

　More at ......
　The gold coins of the Lemurian Empire are too valuable.

　Because of their credibility, they tend to flow out of the country.

　In addition, the Lemurian Empire was originally an over-importing nation, and paid for many luxuries from the East in gold.

　For a variety of reasons, the Lemurian Empire has a chronic shortage of gold coins.

　So what happens when there is a shortage of currency, money, and gold coins? ......
　Needless to say.

　Deflation, falling prices, and economic recession will occur.

　If deflation occurs, the economy will continue its vicious cycle and the size of the economy will shrink little by little.
　No matter how much Hercule tries to protect industry and boost the economy, it will be a chilling effect.

　There is one way to solve this problem.
　The solution is to increase the amount of currency in circulation, that is, to increase the number of gold coins issued.

　But you can't change the amount of gold mined.
　The only way to do this is to change the number of coins that can be made from the same amount of ...... gold, that is, to reduce the amount of gold contained in gold coins.

　To tell you the truth, I don't really want to do that.
　Well, ...... I can understand how you feel.

　Shylock chuckled at Hercule's words.
　In the Lemurian Empire, only the Emperor has the right to issue gold coins.

　A gold coin with Hercule's profile and name stamped on it is the very essence of his authority.
　To degrade the dignity of these gold coins would be to diminish the authority of Hercule, the Emperor of Lemuria.

　The fact that successive emperors have maintained the dignity of their gold coins is a sign of pride as the monarchs of superpowers.

　In the Lemurian Empire, where business itself is considered to be a low value, reducing the gold content of money can be regarded as a fraud, and if the emperor himself led such a fraudulent act, he would not be able to avoid criticism.

　In addition, reducing the quality of money and increasing the amount of money in circulation is likely to lead to a significant decrease in the value of money and rapid inflation.
　Rapid inflation will hit the wallets of the lower classes of the Lemurian Empire, the bureaucrats who earn fixed wages, the soldiers ...... and the Lemurian nobility who receive stipends.

　The economy is a complicated thing. I really don't want to mess with it too much.

　There are as many theories as there are economists.
　Although the structure is simpler than that of modern Japan, it is still complex.

　We do not know how it will turn out.

　But I can't stop myself from doing it. So, the ...... question is how much to lower it. I'm going to take a wait-and-see approach and set it at about 80 percent.
　"So the rate of increase of money is 1.2 times. Isn't that a little weak? I think it's okay to lower the rate to 70%, but I think it needs to be lowered to ...... 1.35 times or even less to be effective.
　"Ummm .......

　After listening to Shylock's suggestion, Hercule pondered for a bit and then said, ......

　I'll take a pause. Seventy-five percent, 1.27 times. Frankly, I don't want to get too adventurous, and ...... anything less than seventy percent gold is too degrading. It is a matter of national prestige.

　If it's not enough, you can devalue it for a while.
　Hercule persuaded Shylock to do so.

　Even Hercule was reluctant to change the coinage.

　The problem is that we don't know if the merchants and the Church will cooperate with the minting. ......
　"Exactly, that's the problem. Bad money drives out good money.

　It's a good thing that you're not the only one who has a problem with this.
　The material itself guarantees the value of the coin.

　If you ask someone to lend you some money to reduce the amount of money, few people will say, "Yes, I see.
　In addition, there is a good possibility that the highly valuable old coins will be stored away.

　"Actually, I have a secret plan, do you want to hear it?
　"Would you like to hear about ......?
　How about if I take your money and ask you to lend it to me for a few months so I can pay you back later, and then I'll mint it all over again?
　Isn't ...... a good place to start second-guessing?
　That's right.

　A long time ago, the pretender of some city-state used this kind of method to pay off his debts.
　Columbus' egg worked the first time, but it won't work the second time.

　This is the only way to pay off the debt. Do you think they would accept a six percent or even seven percent increase?　Against the Church, I will ask for the cooperation of the mediums and threaten them with force. As for the merchants, the only way is to threaten them with the abolition of guild privileges. Also, to prevent the outflow of old gold coins out of the country, the Lemurian Trading Company should be entrusted with foreign trade, and the export of gold coins should be strictly monitored. ...... Well, I guess it's a drop in the bucket.

　I guess it's better than nothing.


　Hercule cowered.

　"By the way, Your Majesty, are you sure you don't want me to change the silver?
　"Oh, that's no problem. In fact, it's better if you don't.

　Hercule responded immediately to Shylock's question.
　Of course, if you lower the gold content of the gold coins but do not change the face value, the exchange ratio between gold and silver coins will remain the same.

　This would mean that the value of silver coins would increase as the value of gold coins decreased.
　The value of silver will rise as the value of gold falls, resulting in the depreciation of gold and the appreciation of silver.

　"Remember?　Remember, the Farce is a silver economy.
　"Oh, I see. ......

　The Lemurian Empire is a gold economy.
　The Lemurian Empire is a gold economy country and the Kingdom of Phallus is a silver economy country.

　What does Hercule mean by that? ......
　It is easy to understand if you replace the Lemurian Empire and the Kingdom of Phallus with Japan and the United States, and gold and silver with the yen and the dollar.

　In other words, the policy of weakening the yen and strengthening the dollar.
　The aim is to promote exports from the Lemurian Empire to the Kingdom of Fars and to suppress imports.

　The Lemurian Empire imports a large amount of luxury goods such as silk and jewels through the Kingdom of Fars, but Hercule wants to reduce these imports and increase the exports of coffee and sugar from the Lemurian Empire to the Kingdom of Fars.

　The Lemurian Empire is importing a lot of coffee and sugar. As expected, Sasan VIII will not easily notice this, and it will be difficult to take countermeasures. Anyway, since that's the case, ...... you should make your preparations, and finish laying the groundwork with the merchants. I'll make the necessary arrangements with the church and the nobility.

　With that, Hercule sent Shylock out of the room.
　He then took Cecilia's letter from the drawer and began to write a reply: ......

　He began to write a reply.






　Now that he had finished writing Cecilia's reply, Hercule summoned Galfis, Christos, and Loukanos.
　All three are undoubtedly pillars of Hercule's government, but ......
　They have different jobs.

　It was the first time in a long time that all three had been summoned at the same time.

　What is it that they want?
　He greeted them with a questioning look on his face, looked them over and said.

　This time, I've been summoned not as a soldier or a clergyman, but as a nobleman of the ...... Holy 77th House. To put it bluntly, we want to deal with the baggage of the Pureblooded Long Ears (High Elves).
　"Oh, .......
　I see.
　"Finally.

　The three of them looked convinced.
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　The Seventy-Seven Holy Families are: ......
　The Seventy-Seven Holy Families consist of seventy-seven main families, including the Julianos family, and three hundred or so branch families, and are the families and clans of the venerable and pure-blooded High Elves that have continued uninterruptedly since the founding of the Empire.

　It is the history of the Lemurian Empire itself, and the pillar of the nation.

　However, in reality, there is a wide range from one to the other.

　Excluding the Julianos family, the seventy-seven families can be divided into four categories.

　The powerful families that are financially sound, have almost no debts, and still have a lot of land and political interests.
　Examples are the Lucarios and the other five families.

　Next, a family that is financially sound, but has some debts ...... that are within a sensible range and are classified as average for a noble family.
　Examples are the Galeanos, the Audias, and 25 other families.

　Next, there are families whose finances are deteriorating and debts are piling up. ...... These families manage to survive by cycling and maintain their appearance as nobility.
　You can find a lot of people who are interested in this kind of thing.

　Lastly, there are twenty noble families whose finances are completely bankrupt, whose merchants have given up on collecting their debts, and whose members would starve to death if their stipends were suspended.

　Of the seventy-six pure-blooded High Elf noble families, forty-six are on the verge of financial crisis, and twenty of them are already bankrupt.

　The financial resources of the Empire are not abundant. And considering that prices will rise as the economy develops, we can't let them rely on stipends forever. We need them to be independent to a certain extent.

　It was the Julianos family that had indulged him until now.
　The Julianos family is to blame in that respect, but we can't just let them hang around forever just because they are .......

　That's why I want the three relatively successful families of Lucarius, Gallianos, and Odias to come up with a concrete plan to restore the financial health of the 46 families.

　Hercule told the three of them.