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Good Money, Bad Money, and Runaway Inflation

In ancient times, the value of money was closely tied to the amount of precious metal it contained. Even the large copper and bronze coins had a significant amount of valuable metal in them and since they were usually quite large until about A. D. 250, they were worth a considerable amount even if they were just melted down and recast as arrow points or tools. From even earlier times, the value of money was tied to the value of cattle, so it is not unusual to find the value of items expressed as "worth so many cows."

If a silver or gold coin was to be accepted by merchants, traders, farmers, craftsmen, and laborers, it was expected to contain the correct amount of precious metal. If it was underweight or the silver was mixed with too much of a base metal such as copper, it would not be valued as high as the face value the government put on it. Therefore, if a merchant had sold an item before for ten coins of good silver, he might demand 12 or 15 debased coins to pay for it if the government decided to cheat and add copper to its coins to make the silver go further. The science of the ancients might seem somewhat crude and backward to us, but they did have a certain technological awareness that people don’ t have today. Most people, shopkeepers, merchants, and even individuals had a method to tell good money from bad. If you were a merchant and could not do this, you would soon go out of business in ancient Rome. They gained the ability to tell good silver from debased silver just by the look, taste, and feel of the coins. The bad ones also would ring differently when dropped on a hard surface.

The major silver coin used during the Roman Republic and throughout the first 220 years of the empire was the denarius. This coin was worth approximately a day's wages for a skilled laborer or craftsman. Referred to in the Bible as a "penny," the denarius was the coin in which the army was paid and taxes were collected when they were not collected in the form of agricultural products like cows or wheat. The sestertius and the as, made of copper or brass, were used for smaller everyday purchases by the common people. The denarius was a silver coin between the size of a modern dime and a nickel. The as was about the size of a quarter to a half dollar and the sestertius was larger than a half dollar and sometimes larger than the old United States silver dollars. Most Roman coins of the early empire would seem like they are too thick to us and have uneven edges, but many of these ancient coins have far more beautiful designs and portraits than modern ones and are not considered crude or primitive by scholars and lovers of fine art.

The denarius was almost pure silver in Republican times and stayed that way up through the reign of Domitian, except for some debased coins issued during times of crisis, after which the silver was struck pure again. These coins might have up to five percent copper to harden them to take the wear and tear of circulation, but were otherwise quite good. Starting gradually in about A. D. 110 or so, the Roman government deliberately added a certain amount of copper to the silver in its silver coins. The massive amount of wealth that had been taken from conquered cities during the Republic and early Empire had been used up. Large amounts of gold and silver were being used up in fine jewelry, eating utensils, bowls, ornaments, and other luxury items coveted by the enormously wealthy senators, members of the Equestrian order, government officials, and people of the imperial household. This left little precious metal to be struck into coins. Also, the need for coins had greatly increased. The army had gotten large raises in their yearly pay under Julius Caesar, Domitian, and Septimius Severus. In order to pay these rising expenses, the government resorted to cheating. Under Trajan, the denarius gradually became only 85 - 90% silver. Under Marcus Aurelius, the proportion dropped to about 75% and dropped to about 60% under Septimius Severus (A. D. 193 - 217). Septimius Severus' son, Caracalla, tried another method of cheating. He introduced a "double denarius" that weighed only about one and one half times as much as a denarius. This soon became enormously popular with the government but not with the people who had to accept these underweight debased coins in payment. Severus Alexander (A. D. 222 - 235) tried to reform by going back to the denarius but, once started, this path of runaway inflation and financial irresponsibility on the part of the imperial government proved impossible to control. By the reign of Valerian and Gallienus, the double denarius had only about 25 - 35% silver which looked quite nice when newly minted but soon turned a dull gray in circulation. By about A. D. 260, the middle of Gallienus' reign, the coins had barely 5% silver, mostly in a thin coating of silver over a bronze core. These coins looked tinny when new and quickly turned almost totally black or gained a splotchy gray appearance. They were hastily struck by the mint employees in order to allow the government to pump millions of them into circulation. This is why many of the pictures you will see of mid Third Century coins are poor and the features are hard to see. Some of the pictures in this title are of the best preserved coins obtainable from this era. The economy was in almost total collapse, with many wealthy senators and merchants fortunes totally wiped out because their money was almost worthless. Trade was carried on by the primitive method of barter and the government started accepting only pure gold or silver, known as bullion, for taxes. Things improved a little under Aurelian (A. D. 270 - 275) and Probus (A. D. 276 - 282). Diocletian totally reformed the coinage in A. D. 293, again striking almost pure silver coins as well as new bronze ones. It is interesting to note that throughout all of this, the gold coins remained almost always pure, though their weight was changed around in response to the wild fluctuations of the economy. This was little consolation for most of the population of the empire who never saw the gold coins in everyday circulation. The subject of ancient coins and the hobby of collecting and studying them is a fascinating one. There are many more types and denominations of ancient Roman coins than the ones I have described here. The artistic quality ranges from the beautiful commemorative scenes depicted on Republican denarii and bold, lifelike portraits on sestertii of Nero, Antoninus Pius, and Julia Domna to the carelessly engraved portraits and crude reverses sloppily struck on ragged flans during the reigns of Gallienus and Claudius II Gothicus. Many Byzantine and late Eastern Roman Empire coins have stick figure portraits and reverses that look like they could have been drawn by children. Learning to read the inscriptions can give us a sense that these real people living so long ago felt and thought and hoped for some of the same things we still do today. We can read the familiar letters because the letters are our very own alphabet, which was brought very close to the form it is today by the Romans. We also see some of the roots of our own language in the Latin words. We can easily translate legends like SECVRITAS REIPVBLICAE and GLORIA ROMANORVM into our own language and will have no trouble understanding when it is pointed out to us that FIDES MILITVM means "Loyalty of the Army" or "Faithfulness of the Military."

Most people are also surprised that many ancient Roman coins are so inexpensive. Imagine owning a coin from the time of Jesus for only five or ten dollars or buying a "like new" 1700 year old coin for thirty-five to fifty dollars. Many ancient coin dealers will be glad to show the newcomer to the hobby what they have in their stock and there is usually little pressure to buy, but much encouragement to learn. They seem to be a little more honest and friendly than many other dealers in collectibles who are only after your dollar. What you would pay for coins and books about them will bring you a return on your investment many times over in the value of the education you will gain by studying and enjoying your new hobby, not to mention that most nice ancient coins increase in value over time!

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