Ludwig von Mises on Money and Inflation.pdf - The Ludwig von ...

money pieces. And the second disease, which was very often connected
with the first, changed the color of the silver coins, practically the only
coins that were used in those days. What these old governments very often
did was mint the coins in the traditional shape, but they mixed with
the silver or gold some less precious metal like copper. Unfortunately
copper has another color from silver, and another specific weight, so it
could be discovered by people who had available the technological methods
and instruments. It was a very difficult process. But they did this.
And they didn’t mention it. e coins slowly changed color in the course
of the years, became a little bit reddish, not because they were affected by
communist political ideas, which we today call “red,” but because the governments
that manufactured them put more and more copper in the coins
which were assumed to contain only pure silver. When the governments
became more and more aggressive, let us say, and added more and more
copper, the color of the coins changed still more. Also most people are
not color blind, especially not color blind in regard to money. is was
too much for the people. So it was not very easy to continue to maintain
this fiction. e coins became redder, and thinner and thinner.
e government maintained that the new coins minted by them were
not different from the coins that had been minted before. In some way
or other it was always a catastrophe for the citizens who did not know
how to fight it. But it was a small evil, in spite of the fact that the effects,
the unavoidable effects of inflation, became visible even in those days. It
took some time for the simple citizens to discover it. But even citizens
with very little information and knowledge of metal could discover the
differences between a legally and ritually [properly] coined piece of money
and another piece which was not. e people soon discovered that the
government could spend more, and did spend more, than it had before.
And prices went up.
e very famous Roman emperor, Diocletianus (286–305 AD), was
very well known in religious history—I wouldn’t say for his good deeds—
but he was also known in the history of monetary annals. e more the
silver content of the currency dropped as against the copper content, the
more prices went up. And Diocletianus behaved in the same way as does
our present government. He said it was somebody else’s fault, the fault of
the businessman. And therefore he resorted to price ceilings. Our price
ceilings are printed on paper, but in the 3rd century, in the time of the
emperor Diocletianus, such a system of price ceilings was printed on stone,
the way we make our monuments. erefore, his interference with the
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