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  • Thoughts on a Numismatic Question

    From Quadibloc@21:1/5 to All on Wed Nov 3 22:49:47 2021
    In 1912, in Wroclaw, then called Breslau, as it was in Germany, there was the famous game between Levitsky and Marshall that ended with a queen
    sacrifice so stunning that, according to Marshall, the spectators tossed gold coins at the board.
    Some accounts express some doubt about whether this actually happened.
    I would be inclined to accept Marshall's word. But one doubt crossed my mind. Why would anyone have gold coins in his pocket? Yes, nearly every country
    minted gold coins at that time, but my understanding was that they had fairly limited circulation, with people using paper money instead of gold coins for large amounts.
    So I reflected on this question: what were gold coins _used_ for? I know that at
    one time in the United States, import duties had to be paid in gold coins, or at
    least gold certificates, and not Federal Reserve Notes.
    And then it dawned on me.
    If you're a tourist from the United States, or from Russia, visiting Germany, back in 1912, perhaps you wouldn't do what tourists would routinely do nowadays: go to a bank, and get a certain amount of your dollars or
    rubles converted to German marks.
    Naturally, you wouldn't expect local merchants to accept American or
    Russian paper money; they might not be able to tell how much it was
    worth, or recognize what it was supposed to look like to be sure it was genuine.
    But gold coins? Basically all one would have to do is _weigh_ them!
    And I do know - you can find them on Google Books and in the Internet
    Archive - that there were books available at the time that gave the
    weight, fineness, and value of gold coins extant all around the world.
    So people used their own country's gold coins as money when they
    travelled abroad, before things like traveller's cheques and credit cards
    were invented!

    John Savard

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  • From Rainer@21:1/5 to Quadibloc on Thu Nov 4 11:09:01 2021
    On 04/11/2021 06:49, Quadibloc wrote:

    In 1912, in Wroclaw, then called Breslau, as it was in Germany, there was the famous game between Levitsky and Marshall that ended with a queen
    [...]
    travelled abroad, before things like traveller's cheques and credit cards were invented!

    John Savard

    Ever heard of https://en.wikipedia.org/wiki/Gold_standard ?

    Rainer

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  • From Quadibloc@21:1/5 to Rainer on Thu Nov 4 15:27:48 2021
    On Thursday, November 4, 2021 at 4:09:06 AM UTC-6, Rainer wrote:

    Ever heard of https://en.wikipedia.org/wiki/Gold_standard ?

    But that article talks about things at a high level.

    If there's a gold standard, that just means that the value of paper
    money is determined in terms of gold, and that under some
    circumstances, the paper money can be redeemed for gold at a
    fixed rate.

    In the practical level, even back in the 19th century, people didn't
    usually carry gold coins in their pockets. They carried silver and
    copper coins - and paper money for larger amounts. Gold coins
    existed, and the value of paper money was determined by gold.
    but paper money and not gold coins were what was normally used
    even then.

    So why would people - even if they were wealthy people - have
    had gold coins in their pockets the way this story suggests?

    That took some thinking about matters that were details of
    everyday life in those times - things that weren't discussed in
    that Wikipedia article, even if they were consequences of a
    widespread gold standard.

    So I think my conclusion is reasonable, and informative: that
    the reason countries minted gold coins wasn't just to have an
    internal unit of foreign exchange for transactions between banks
    and the government or other esoteric uses, but instead they
    had a practical use - a currency that would be easier for the country's citizens to use than paper money when travelling in a foreign country.

    For the reasons I noted before: gold's value is universal, whereas
    paper money is just paper unless you know how much it is worth
    and that it isn't fake.

    And so the spectators, many of them being tourists from Russia
    or the United States, had a *reason* to have gold coins in their
    pockets as they were watching this game being played in
    Germany.

    John Savard

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