Cosma Empire

In the morning meeting, the Ministry of Foreign Affairs and the Ministry of Foreign Trade gave the agenda of the day, regarding the unified currency used after the formation of the World Financial Trade Organization.

The whole morning will be spent on solving this problem, and this problem is also a problem that everyone is very concerned about.

If the empire insists that each member country take out a certain amount of gold as a risk reserve for issuing a joint currency, some small countries may face some big troubles.

It is very common for the currency exchange rates of small countries to fluctuate in the foreign exchange market. It can be said that this is a very normal phenomenon. There are two reasons for this situation.

First, if the country's currency is issued based on national credit, any economic decision or even a change in a stock may drive the performance of the currency in the foreign exchange market.

The country is small, the system is not perfect, and the economic structure is single. Once the enterprises that occupy the dominant position in the economic field have some operational problems, it may be just a business failure. Huge fluctuations in the economy, which in turn affect the currency's performance in the foreign exchange market.

Moreover, the credit currency system often appears in large countries, and it is difficult to see it in small countries. If you have to ask why, it can only be said that small countries have suffered too much interference in national credit and international issues, and do not have the ability to resist risks. Therefore, it is not very suitable for smaller countries to adopt the credit system.

The diplomatic dynamics of neighboring countries, even the slightest diplomatic dynamics, may cause the people and even the capital market of the whole world to re-evaluate the beliefs of this small country. Even some diplomatic issues are not aimed at this small country, and may cause chain reactions.

Constantly fluctuating exchange rates are definitely not a good thing for a country's financial economy. Disputes and problems are prone to occur in international settlements, so small countries tend to prefer precious metals, such as gold as a risk reserve. Proportionally carry out the issuance of currency.

In the second case, the issuance of currency is based on precious metal reserves, and how much currency can be exchanged for an ounce of precious metal is stipulated with strict and accurate figures, and the exchange rate of currency is determined indirectly, which seems to be an easy thing to do matter.

Currency itself does not have any value, and it is just a special commodity used for circulation in a small range, but they will become different when they are related to gold.

Precious metals such as gold are common hard currencies all over the world, so pegging the price of gold for exchange rate comparison can reduce the sharp fluctuations caused by financial problems in the currency.

However, this is not always the case. For example, a large country suddenly starts selling gold for some reason, which will lead to a rapid decline in gold prices.

Another example is that a gold mine with huge reserves is discovered in a certain place. Even if the mine is located abroad, the world's gold price plummets, and even a small country with a very good development momentum also causes the currency exchange rate to plummet due to the sharp drop in the gold price, causing serious losses in foreign trade.

However, this situation is obviously much better than the first situation. It is not every day that this world can find gold mines with huge reserves that can affect the world.

Even if it is discovered, it may not be mined. Before the gold buried in the ground becomes golden bricks and sent to the bank, its role will not be immediately reflected in the financial market.

But if Yaoxing Empire needs everyone to take out a proportion of their gold reserves this time, it will really suffer for these small countries.

It is clearly a good thing, but it has become a bad thing. The reduction of gold reserves means that the potential value of the currency is reduced, which will affect export trade.

This is like having 100 grams of gold at home and issuing 100 yuan as a risk reserve, and now 50 grams of gold are taken away, which also means that only half of the gold used to fight risks is left. Then the actual value of the 100 yuan that has been issued is only half.

One dollar can only be equal to fifty cents in the past. There is no doubt that this will definitely have a huge impact on the economy of the entire country.

The money in people's pockets is suddenly worthless, and civil strife or even civil war may break out in some places.

Most of the morning meeting was devoted to discussing whether it is necessary to issue a joint currency, and what changes will be brought to the member states after the issuance of the joint currency.

Regardless of whether these participants are state leaders or rulers, or high-level representatives of the country, when it comes to such a critical moment, each of them ruthlessly disagrees with others' opinions and agrees with their own opinions.

In fact, it is not that there are no countries in these countries that are in favor of issuing a joint currency. Of course, these people have their own plans.

The princes of the Colt Empire agreed to issue a joint currency in order to solve the problems of the domestic financial structure.

They are in a period of transformation between feudalism and modern society. The Great Pharaoh wants to push the Colt Empire to complete the system transformation quickly while ensuring that his power is not threatened, and keep up with the pace of the international power Yaoxing Empire.

But this is certainly not clear in a few sentences. In the Colt Empire, people in many areas still use gold coins as an important currency for circulation, and they are not interested in the paper currency issued by the royal family.

This has led to the failure of paper currency from the initial stage of issuance. This is very bad, and it is inconvenient for the royal family to control the domestic financial order, so that in a fairly feudal country, the status of merchants is about to surpass that of nobles. , This is simply an international joke.

If the establishment and issuance of the joint currency can be promoted, according to the IFTO and international settlement methods, merchants in the Colt Empire must use the joint currency for international trade settlement.

Then the question arises, how to obtain joint currency?

It is a matter of course to use paper currency to obtain it, so how to obtain paper currency, it is very simple, exchange it with gold coins!

Doing so can quickly gather a large amount of gold from the people, and at the same time, the right to issue currency controlled by the royal family can bring more voice to the royal family in the financial field, which is of great help to the Colt royal family to stabilize their power position.

Most of the other countries that support joint currency issuance have their own ideas, all of which are considered from the standpoint of their own interests.

As for those who do not advocate the issuance of joint currency, they are basically small countries that do not have the ability to resist the risk of international financial trade. Some people even think that the issuance of joint currency is very likely a conspiracy of the empire.

Once their domestic gold reserves are insufficient, the national currency is likely to be gradually eliminated by the joint currency. In the end, the joint currency is not only the international settlement currency, but also the main currency in circulation in their country.

In case the Yaoxing Empire plans any more terrifying conspiracy, it is absolutely possible to directly destroy their financial order, destroy their economic construction, and plunder their country's wealth.

After arguing all morning, there was no result. Finally, when he was about to take a lunch break, the foreign minister of the empire made a suggestion.

"Since everyone's opinions cannot be completely unified at present, we can propose another relatively mild way, using the imperial star dollar as the international settlement currency. You can discuss it during your lunch break. We will continue to discuss this issue in the afternoon..."