Part VI: The Renaissance

After the destruction of sound money, the citizens of Rome were now dealing with a much different city. They were now under the mercy of their local lords, there were multiple corrupt governments, and gold was concentrated in those corrupt hands. 

Gold was no longer in circulation amount the population of Europe, so they used bronze and copper coins that were easily inflated. The coins people had went from being salable across space, time and scales to being salable across none of those things. The coins were easily debased and worn down quickly and were also nonstandardized. 

Taxation and inflation destroyed the wealth and savings of the people in Europe. So now, the future generations in Europe had no wealth to be passed down to them. Not because the older generations were evil but because they were incompetent.

Europe was now in the dark ages, and they would need sound money to enter the Renaissance again. So in Florence, in 1252, the city minted a coin called the Florin. This was the first significant sound money since Caesar's assassination. Florence became the commercial center of Europe, and Florin was the medium of exchange across Europe. By 1270, 18 years later, more than 150 European cities and states minted the sound money coin known as the Florin. 

Now all the cities on the florin standard flourished; they were able to accumulate wealth and spark new trade deals. All of this was possible because of sound money. The Florin was salable across scales, space, and time, which is the reason for The Renaissance. 

After the standard of living for Europeans increased, they began to study politics and science and became more intellectual. The culture also flourished, and so did the happiness of everyone. From Rome to Florence to Venice, sound money is necessary for humans to flourish, and it's been proven throughout this history. Without sound money, humans have to incentivize shorter-term thinking, which incentivizes destruction, not preservation. 

Gold was back to being a long-term store of value, and silver was used for smaller payments that had shorter durations. However, with gold and silver being in circulation like before, it caused speculation between the exchange rates as more sovereigns set them. This is known as bimetallism (using 2 metal coins at once), and it has continued for many more centuries and continues to this day.

The silver coin didn't really leave the European economy, or even start to, until advancements in technology. The telegraph in 1837 and the growing networks of trains. With these two innovations, banks could communicate faster, making gold more portable. And now, to send payments across space, they developed another system to reflect the physical payments on paper instead of sending physical gold. They called these bills, checks, or receipts. 

In 1717, Isaac Newton, the warden of the Royal Mint at the time, directed that Britain should enter the gold standard. And so they did, and it helped Britain prosper and trade well with countries worldwide. Other European countries saw this success and began to follow it. One by one, more Europeans adopted the Gold Standard, known as the Golden Age. 

During this Golden Age, people didn't have to carry physical gold and silver coins; they could just carry around pieces of paper that represented them, which was much more salable across space and scales. As long as banks didn't manipulate the supply of gold, it would be salable across time too. But of course, they got greedy, and we know they did just that. 

During this, citizens and countries who stored their wealth in silver faced dire consequences; their wealth was stolen. So, as history has shown us, societies can't function on 2 different currencies simultaneously if the more sound version (gold) is being hoarded by a centralized party. Everyone holding the inferior money (silver) would inevitably have their wealth taken from them due to inflation. 

The gold standard was the world standard for capitalism. It increased welfare, liberty, and democracy economically and politically. Free traders flourished, and societies got wealthier. 

Then WW1 happened, and major economies went off the gold standard to finance the war. And as we know, every time this happens in history, no matter how many centuries we go back, it leads to complete economic, cultural and societal collapse. Only Switzerland and Sweden remained on the Gold Standard and remained neutral throughout the war and remained on the standard into the 1930s. 

Now, the era of government-controlled money was to officially commence, marking the end of the gold standard. The end of the gold standard marks the point where society had to collapse; it is literally a house of cards. But not even the gold standard was perfect, as we know because governments and banks were profiting off the exchange rates as they held it in reserves. And countries at war would seize gold from each other, inflating one country's supply worse than the others. At any point in time, even on the gold standard, there could have been a gold run, meaning too many people asked for their gold to be redeemed at once. The abolishment of the gold standard was going to happen; the government knew this.

Without the gold standard, a powerful society could now expand credit indefinitely. People, over time, forgot it was fake, and now the fallacy has become a reality. People live in an illusion where they think the paper we trade with holds real value. Whoever advocates for fiat money (government-issued pieces of paper) also advocates for war and destruction by default because that type of money leads to complete collapse. 

But even as the gold standard was abolished, the government kept all the gold. So now they controlled all the past, present and future wealth. They knew exactly how to inflate and deflate it at their command, and now stealing wealth from everyday people was even more accessible. As you can see in this chart, the reserves were barely changed, besides people no longer being able to access the wealth of their previous generations, leaving them with nothing, just like what happened to Rome.