Chapter 258: Storm

Palace of vienna
Franz's wedding is officially on the agenda. On this issue, he can't help himself. More than 50 million people in the New Holy Roman Empire are looking forward to it.
Zodiac days must be chosen. In case the days are not cloudy and rainy, wouldn't it tell everyone that God doesn't like this new couple?
Leaving at ordinary people, when you encounter this kind of situation, you have to be sighed. If you are a fanatic, you may cancel the wedding. If it were placed on the royal family, let alone, it would be a huge political scandal.
Although the influence of theocracy has been greatly reduced, such feudal superstitions still prevail in conservative Austria.
After research by a group of theologians and part-time meteorologists, the last day of the zodiac was set on March 12, 1855.
Preparatory work has begun, and Franz has to occasionally go to ask him to show his importance to this marriage.
Getting married is a good thing, especially with someone you like. Well, Franz admits that he has ordinary feelings for Princess Helen, but for an emperor, it would be happy to be able to marry a person who doesn't hate him.
Franz's good mood didn't last long, and things happened.
"Your Majesty, our plan to buy gold has failed, and the price of gold on the international market has skyrocketed by 20%. If we continue to buy it, we will lose too much.
After our investigation, we found that the price increase of gold in the international market was planned by the British in order to prevent us from buying gold. The Minister of Finance said with a tired expression
It can be seen that he should not sleep well for a few days.
At a critical moment in the currency reform, the British raised the price of gold and prevented Austria from buying, which was obviously bad intentions. Such a thing happened, and the pressure of the finance minister leading the currency reform can be imagined.
Franz frowned. Under normal circumstances, the British had no reason to hinder the currency reform of the New Holy Roman Empire, and the increase in the gold standard system was also beneficial to them.
"Is it clear what the British are doing?"
Franz asked, if he didn't believe the British did it for profit. If it is just to raise the price of gold and make a profit from it, then the unit price will be slow.
As long as the increase is not too great, in order to increase the gold reserve, the Vienna government will recognize it?
Suddenly, it has increased by 20%. Such a disparity will make idiots continue to buy.
Forcibly raising the price of gold is not without cost. Capitalists who speculate on the price of gold can leave it alone, but after the appreciation of gold, the sterling linked to gold has also appreciated.
This is equivalent to a sudden appreciation of 20% in the pound. With such a large increase, the cost of British industrial and commercial products naturally increased sharply, and it is difficult to maintain competitiveness in international trade.
Are British capitalists tired and ready to play to death?
From start to finish, Franz never thought it was planned by the London government. To do such a thing is to kill the enemy one thousand and harm eight hundred. Who is doing harm to others?
Karl replied with a distressed expression: "It is said that it was to prevent us from acquiring gold, so that we could not raise enough gold to make reserves."
He didn't believe this statement himself. Austria is also an old empire, with its traditional heritage. If the government is willing to pay, domestically, it can raise gold reserves of gold standard.
As long as the government's credibility is high enough and it is recognized by the market, even if the gold reserves are slightly insufficient, the gold standard reform can be completed.
In the final analysis, the issuance of banknotes still depends on the government's credibility. The Russians are the opposite example. They are not worried about insufficient reserves, but the paper rubles they issued before are still not bought.
Can the British never directly defeat the market's confidence in the new Holy Roman Empire? If they had this strength, they would have threatened the Vienna government long before the war.
Franz sneered and said, "Continue to check, you can't buy gold. Anyway, we are well prepared, and the gold for currency reform is barely enough.
The remaining shortfall is not big, and it is not a big deal to use gold and silver in the country. The British have the power to raise the price of the European gold exchange market. I don't believe they can raise the world's gold price.
However, we still have to make a stance to continue buying gold, so that the British can continue to maintain the high level of gold and see how long they can last! "
Unsmooth information is the biggest malady of this era. In areas with poor information, the price of gold and silver remains the same.
To raise the global price of gold, unless the British maintain high gold figures for many years, many regions outside Europe will simply fail to respond.
If Britain did that, Franz laughed. It is not a big deal that the time for reform of the gold standard will be dragged on for a few years. This is not anxious. It is not fatal one year later.
I just don't know if the British industry and commerce can sustain it, because the increase in production costs caused by the rise in the currency value will inevitably reduce the international competitiveness of British goods.
Of course, the profits of overseas trade were relatively large in this era. Franz believes that capitalists took such a large risk to conduct ocean trade, and 20% of the profits were still there.
It is still possible to maintain commodity competitiveness without increasing prices. But trade on the European continent may not be as profitable.
Even if the British are the world's number one industrial powers, it is not that they can dominate in every field. These industries cannot stand the blow.
Franz even once had the idea of ​​driving up the pound and hitting British business and industry, and he was instantly annihilated.
As far as Austria's capital is concerned, if there is a positive game between financial markets and British capital, the possibility of losing is almost nine to nine.
London
The Granville Cabinet was dumbfounded that they did it to raise the price of gold, but they were not prepared to raise it so much at once!
According to the original plan, they only raised a few points to let the Vienna government retreat and accept their terms, but they were not ready to let the price of gold soar.
Unfortunately, they ignored another group in the world-speculators.
It is no longer a day or two that the British domestic capital is too flourishing. Now the rapid economic growth of the United States and Austria cannot be separated from the help of British capital.
This time the government raised the price of gold and was sought after by everyone. The price of gold and silver rose rapidly and then exceeded control.
There are only two ways before the London government. Either immediately sell a batch of gold and calm down the price turmoil in the capital market; or depreciate silver and the price of silver falls, so the current high exchange rate is normal.
One of the reasons why everyone is enthusiastic about gold is the reform of the gold standard of the new Holy Roman Empire.
Once the Vienna government has completed its currency reform, the new Holy Roman Empire will certainly not hold so much silver. This silver has flowed into the market and it is inevitable that the price of silver will plummet.
The speculators have a keen eye. They judged that the price of silver would fall in the future through the most basic information in their hands and started to act.
In a way, even if the London government does nothing, this situation will still happen, and the gold-to-silver exchange ratio is on the rise.
This decision is not easy to make.
Selling gold to calm down the storm stabilizes the value of the British pound, so the plan to block the Vienna government's purchase of gold will go bankrupt. In the future, if you want to pull the new Holy Roman Empire into their pound-gold system, it will be necessary to pay a greater price.
Of course, it is not without gains. The London government will make a fortune in this operation, which can make up for their injured hearts.
The devaluation of silver also needs to consider the consequences. The most direct thing is that the currencies of the silver-standard countries have depreciated. The economic response is that the commodity exports of these countries will become more competitive.
This setback will affect the export of British industrial and commercial products, which will affect the British economy.
Prime Minister Granville asked anxiously: "What plans does the Treasury have to calm down this storm?"
Without any hesitation, Treasury Secretary George Gray gave the answer: "The Prime Minister, the best way now is to sell off the gold we bought and let the market return to normal.
This is the practice with the least impact on the domestic economy. Since we bought it at a low price, we can still make a profit by selling it now.
And it has to be fast. The Vienna government still hasn't given up its plan to buy gold, which is simply stimulating the nerves of speculators.
Most likely, they have discovered our plan, and now they deliberately make an inevitable posture just to see our joke.
If the delay is long, more speculators will join in. At that time, it will be difficult for us to calm down the storm. "
The gold bought by the government and the reserve of the currency issued are completely two concepts, even carried out by two different systems.
In the era of the gold standard, the government cannot take for granted the decision to reduce its reserves or increase its reserves, all of which must be carried out according to actual needs.
The consequences of brave action have been felt by the London government. An erroneous signal caused speculative swarms, and the end result was disastrous.
Whoever makes gold a universal currency will not depreciate in the eyes of many people. Even if it is thrown into the hands, it will not lose money.
After hesitating again and again, Prime Minister Granville made the decision: "Anyway, we must first calm down the price of gold and stabilize the value of the pound.
The Ministry of Finance immediately sold gold and communicated with domestic consortia. We need their help! "
Despite knowing that this will cost a lot, the Prime Minister of Granville chose to seek the help of a consortium, otherwise the strength of the London government alone may not be able to calm the storm in a short time.
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