Why are there only eight 'Henry III gold coins' with a value of about 80 million yen in the world?

A gold coin

found on a farm in southwestern England by an amateur metal detector in mid-January 2022 was sold at an auction in England for £ 540,000. This gold coin is called 'Henry III's gold coin', and only eight were found at the time of writing the article. Moneyness, a blog familiar with economic history, explains why Henry III's gold coins have been found in countless numbers.

Moneyness: Why Henry III's gold penny failed

The discoverer didn't initially understand what the gold coin was, and when he posted a photo of the gold coin he had unearthed on Facebook, Gregory Edmund, an auctioneer and monetary appraiser, saw the photo and found that the gold coin was He noticed the value. The gold coins found were in relatively good condition and were sold at auction for £ 540,000.

The actual gold coins of Henry III can be seen in the following movie.

A New Gold Penny of Henry III | 23 January 2022 | SPINK | London --YouTube

The British economy around the 13th century was a silver standard . However, as Europe as a whole became wealthy, gold circulated in the market and gold coins were issued in the 13th century. For example, the gold coins excavated in the United Kingdom in 2016 are said to have been cast in the 11th to 12th centuries, modeled after the dinar gold coins of the Islamic Empire. It is also said that the Italian city-states of Genoa and Florence also used their own gold coins.

Henry III issued gold coins in 1256, and the exchange rate of '1 gold coin = 20 silver coins' was set. In other words, the customer can pay the merchant one new gold coin instead of 20 silver coins. In support of this rate, it is said that 19.5 silver coins owned by Henry III himself were converted into one gold coin. In addition, it is said that 0.5 of the difference was treated as a 'commission'.

However, when operating gold coins and silver coins at the same time, whether or not the exchange rate between gold coins and silver coins is appropriate is a very important issue. If this exchange rate deviates from the market price, Gresham's law that 'money with higher real value is expelled from the distribution route and money with lower real value circulates' will work.

Historian David Carpenter argued in his dissertation that the exchange rate set by Henry III was appropriate. One gold coin of Henry III weighs the same as two silver coins in circulation at that time, and considering that the value ratio of gold to silver was 10: 1 in the precious metal market at that time, one gold coin = The rate of 20 silver coins is reasonable, Carpenter said.

However, historian John Munro points out that British silver coins were 92.5% pure and the rest were base metals. Therefore, the rate of 1 gold coin = 20 silver coins set by Henry III actually considers the value ratio of gold to silver to be 9.25: 1. In other words, it was more beneficial for British merchants at the time to use 1 kg of gold coins as ingots and exchange them for 10 kg of silver, rather than using 1 kg of gold coins as the same value as 9.25 kg of silver coins.

Henry III noticed that there was a problem with the rate setting, and in 1265, six years after issuing the gold coins, he corrected it to 1 gold coin = 24 silver coins. However, it is believed that by this time most of the gold coins had already been melted and cast into ingots and exchanged for silver. Moneyness pointed out that Henry III's gold coins were rarely found because most of them had been melted.

in Note, Posted by log1i_yk