Take a look at who in Spain got the lion's share of the American silver and gold: en.wikipedia.org/wiki/Spanish_tr ... h_treasure .
Both required pretty good organization. The Spanish crown controlled the influx of silver and gold, and its consequences, over the Casa de Contratación (en.wikipedia.org/wiki/Casa_de_Contrataci%C3%B3n ) from the onset - according to an economic theory safeguarding the supply of the population with necessary goods. The flaws of this theory were found out later, and by destroying some of Spain's economic potency taught Europe.
In Mythic Europe's England, such a control of the consequences of a sudden influx of silver from excessive spending of covenants did not spring up at once. So effects could well have become far worse. We just don't know who mitigated them, and how.
And not one of those sites says a word about price increases, despite the massive amounts of gold and silver being brought in, though one does link to a discussion about a high rate of price increase over 150 years of 1.5%
Also note that increase was not just in Spain, but over the whole of Western Europe, and the site mentions the influence of the Black Death as well, though 1.5% for half the continent seems about right for shiploads of gold and silver being brought in. 8 million pesos in 1550 would be 4.5 grams of silver per peso or 36,000 kg of silver, or 79,200 lbs, or 39.7 tons of silver in a year. Touch of Midas creates 80 lbs of gold worth 1600 lbs of silver, so to cause the same inflation with this would require it be cast 49 to 50 times a year, at a cost of roughly 200 vis a year. Of course this can be done with less vis expense at higher skill (shifting to level 30 creates 100 times the gold for 2 more vis, allowing for a single casting for 4 tons of gold at 6 vis. If you are actually creating silver of course it gets more expensive as you lose the gold to silver value ratio, as well as the density of gold since the spell is based on volume.
Now the possibility that magi were creating silver when prices happened to go up and they assumed they had been the cause, or assuming they were the cause was more convenient than examining what they had been spending that much money on, is certainly plausible, but again it is not as simple and straightforward as "they observed this obvious effect and took measures with full knowledge and crystal clarity"
The important thing for me about 'not producing silver with magic' is that you don't want the nobles learning you can make silver with magic, because it never ends well. Don't let anybody learn you can use magic to make piles of money (one way or another) or they will be all over you because money = power = status and the nobility want all three of these things.
The Silver Consensus doesn't boil down to this. It's about not 'ruining' the economy with magically created stuff. While that's possible, a simple illustration can show how it's not easy. From a Pathfinder campaign we ran, we cleared a salt mine of nasties for a merchant who hired us. In the middle of a war we needed quick cash (as did the merchant), so we volunteered to use some basic magic (Stone Shape, Shrink Item and Phantom Steed spells) to go to the next city state and sell several tons of salt.
At which point someone pointed out we'd glut the market on salt and get a crappy price. So our GM did a bit of research and found how much salt a population of 100,000 with Renaissance technology used in the course of a year. Needless to say, several tons of salt was peanuts - I think were were bringing in something like 2% of their annual use.
The point to remember here is that economies are BIG things. Small local economies might be subject to shenanigans, but large ones have quite a bit of tolerance for these things. Magi creating silver by the ton is the same as mundanes mining silver by the ton - it will attract attention, but not destroy the economy of a nation. Money = attention = problems with nobles, so caution is encouraged, but money =/= economic devastation.
Salt's a poor example because it is a consumable: the purchaser destroys it. It's also a staple: everyone needs to eat salt. Silver's not, effectively,a consumable, and most people will never actually own much of it (the penny is primarily a unit of account for most agricultural people). Mining silver by the ton is a big thing. Before the Carlisle strikes in the 1100s, the silver production in England is..what?...half a ton a year? Economies are big, sure, for consumables which every peasant must eat. For silver coins? Not so much, until the population boom plays out and the towns get enormous.
The Spanish crown, via the powerful Casa de Contratación, tried very hard at keeping the prices in Spain reasonable. Lots of the Spanish gold and silver went more or less directly to Asia, where they helped to boost European trade.
The Stonehenge magi might have been nearly as surprised as everybody else by these effects. Once the damage was done, their autocrats and stewards - the men who had executed the competitive spending on behalf of their covenant, organizing orders, delivery and payment - would have had a few talks with local traders and stall holders, and then could explain the simple story to their masters. But changing the Stonehenge peripheral code was certainly too late.
The consequences of their competitive spending for the economy of Mythic European England are tmk nowhere elaborated. Hence troupes and SGs need to decide them. Perhaps John got hold of most excess silver through taxation, used it for his war in Aquitaine and Northern France, and would have been far more oppressive if it hadn't existed? Or the destruction of local economies by uncontrolled inflation was finally blamed by the English barons on John after the defeat of Bouvines, and thus contributed to the Magna Charta?
..which again is buggy to a point which beggers (my) belief.
Economists are prone to making assumptions using concepts like infinite growth, to which one must respond like this: physics.ucsd.edu/do-the-math/201 ... physicist/
but that certainly puts us way outside the realms of what is relevant for Ars Magica, I think.
No, what you just said does not effectively contradict anything i said ( or quoted )... In fact, your statement actually supports what i said.
We DO know more about economics now than in the middle ages, but that´s mainly thanks to historical experience. Not because theories became so amazingly much better.
And in fact, some of the theories of economy in the last century or two is actually distinctly WORSE. Like the theories that assume rational consumers, that has been so utterly debunked in the last two decades that its rather pathetic that its still being used by so many. And there´s no end to the amount of damage that have been caused through the decades by the "invisible hand" based theories(epic fails more like it!).
And oh yes, the scientific method is applicable to economics, it is in fact extremely necessary exactly because economics isn´t a science, not using it tends to end up with a lot of utterly useless opinions.
Using it still ends up with a lot of opinions, but they usually at least have SOME usefulness.
And just the fact that you consider it a "highly factionalized discipline", just goes to show that you perfectly agree with what i said and quoted. IF economics was a science, then it could not be this badly factionalized because with all the historical data present, we would already know all the answers, as long as it was anything that could be found out from said historical data.
Indeed.
It´s based on historical reality, so why should we make myth worse than reality? Again, much fewer people will have any real and thorough understanding, and even among them, the average level of understanding will be lesser, but if they happen to be the right people, they can have plenty of influence anyway (like trying to prevent runaway inflation).
Otherwise, you´re basically just going back to the bad old "oh but everyone thought the earth was flat!" kind of arguments.
I may not agree with Direwolf on every subject, and I certainly do not always agree with his choice of words.
But on the subject of economics and our knowledge/understanding thereof, I have to largely agree.
Current state-of-the-art economic models fall somewhere between philosophy and religion, in their degree of scientific rigour.
One school (neo-classisists, I understand) deny the usefulnes of history in understanding modern economics, meaning they deny themselves what little knowledge (as opposed to opinion) is available.
Part of the problem is that we cannot make lab experiments with regards to economics, as we cannot design a lab. By definition, economics do not make sense in isolated lab systems.
We can make predictions, and economists ofte do, but these are always (and will probably always be) based on models that are partially founded on empirica, but also heavily founded on guesses and assumptions about human nature.
Ever wondered why 2 political parties can do calculations on the same suggestions - the same numbers - and have results that differ by billions of whatever currency they are talking about? They use different models, with differing build-in assumptions. And as long as they publish results without giving their assumptions, they do not qualify as a 'science'. Nor for that matter do the theories involved qualify as theories in the strict usage of the scientific community.
Economists sometimes try to leech on the strong reputation of the sciences, by proclaiming themselves a science, but are in many ways more akin to preachers able to use a spreadsheet.
EDIT: In case it was not obvious, thhe above is all on my, and my opinion, based on an (so far somewhat superficial) study of economics, and a background in the sciences.
And by superficial, I mean that I do not currently have or claim a degree in economics.
Bad example, if USD actually adhered to economic reality OR theories, it´s value today would be less than 1/10th that it is. Possibly far less still, it gets rather difficult to do hard estimates any further than that.
Of course there´s reason for that, but the reasons are not based on economics.
Not EXACTLY the same no, but runaway inflations has happened a few times in ancient history.
Sometimes due to "overprinting money", or whatever served as money locally.
Most common occurences is when something has caused a "goldrush" economy in a local or sometimes even regional area. Finding a rich source of something in an area, especially if it could be easily used as money, could and did wreak havoc many times.
Nobles controlling coin mints quickly learned that letting all the coins enter the economy in one place was a spectacularly bad idea. For example. This was effectively "common knowledge", regardless if they knew or didn´t know (or care) anything about how it worked.
Ehm, i think you´re about 10-20 years off on your history knowledge here. The German hyperinflation happened in the 20s. en.wikipedia.org/wiki/Hyperinfla ... r_Republic
1921 to 1924. Nazis didn´t come into power until 1933, although their failed coup happened in 1923. en.wikipedia.org/wiki/Beer_Hall_Putsch
The US stockmarket crash in 1929 lead to unemployment (as US banks supporting the German recovery under the Dawes and Young plans reneged on loans) rather than inflation.
And utterly unrealistic.
And when was the last time the "free market" had any ability to handle healthcare anyway?
Healthcare here worked blatantly better and still managed to be cheaper before free market was allowed into the question at all.
Nobles were usually the ones to do it first in real history, as i mentioned before in reference to those in control of a mint. Merchants were already doing it, and the only way for them to do it "more", would be to increase their trade, and most merchants would have limits on what they could manage.
The claim that it IS a false conclusion is itself definitely not conclusive. It may be true, it may be false, or it may be a little bit of both. We do not know yet, and possible may never know.
Not as much as you would think. Remember, we´re in the high middle ages, the climate is nice and cozy warm, food is in relatively good supply ( getting fed enough to survive is essentially very cheap ).
And, there is some degree of control over just about every side of the economy, so we´re specifically not dealing with a free market in any way, the church condemns sins like hoarding and overcharging, which is part of why basic food is very cheap, local guilds, councils and nobles mostly act to maintain a situation that is either status quo, or something "better", and they do so by often being too restrictive, which also means that its more common with having labor in reserve(like journeymen crafters not given their well earned mastery because there´s already X number of masters in the town/region).
Also, this era is very high on population, to the point where more land in Europe is in use than until late 19th century, and the population is probably greater than until 18th or 19th century.
Still, you are correct to some degree at least, labor shortages could and did happen, but usually due to local events or previously mentioned limits having a place end up with too many trained for one thing and too few for another thing, commonly due to something stupid like local rivalry.
