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Thoughts on a Numismatic Question

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Quadibloc

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Nov 4, 2021, 1:49:48 AM11/4/21
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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

Rainer

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Nov 4, 2021, 6:09:06 AM11/4/21
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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

Quadibloc

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Nov 4, 2021, 6:27:49 PM11/4/21
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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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