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Bad Money vs Good Money

King Edward III of England has a "brilliant idea" for solving his coin shortage problem. He releases three new gold coins. Unfortunately, everyone quickly notices that the content of precious metals in his new coins is far, far less than the value stamped on the coin. The coins will be recalled when the Royal Mint realizes that they have made the coin shortage even worse as the full-value gold and silver coins leave the country or are melted down for their base metal value. The value-less new coins are being used to pay off debt such as debts owed to the King which he must accept at their full value even though no one else will. This phenomenon is called Copernicus's Law though in the modern day it is known as Gresham's Law: bad money always chases out the good. [1] [2] [3] [4] [5]

My Take by Alex Shrugged
When you see your friends going through their pocket change looking for silver quarters you have a sense of what happened in England when its silver coinage dropped out of sight but coinage in the Middle Ages is a complex subject. Wear and tear on the coins themselves caused a depreciation in the value of coins in circulation. You want merchants to COUNT the coins... not weigh out the coins as if it were an assay office. The obvious solution was to bring the metal content of the old coins back up spec but the 100 Years' War had sucked up most of the pure silver England had. In wars of the Middle Ages it is cold hard cash on the barrel head or the army walks. No one fights for free. Releasing the undervalued gold florins was an attempt at balancing the depreciated coins vs the florins so that they could continue to count so-many-silver-coins per gold florin... maintaining the balance.... but they misjudged. Then the very thing they feared would happen, happened: hording, melting down and exporting of silver.

Our Lady of the Palm

King Alfonso XI of Castile is celebrating. He has won the Siege of Algeciras. The treaty with the Muslims of Granada establishes a 10 year truce, a doubling of Granada's yearly tribute (12,000 gold doubloons or 3.37 million dollars at current gold prices) and the transferring of the city of Algeciras to the King of Castile. The city's inhabitants march out the the city holding their belongings and Muslim records note that the transfer of the city was done with honor. King Alfonso rededicates a mosque to Santa Maria de La Palma, and makes her the patron saint of the city. They hold Christian services at the Church of Our Lady of the Palm on Palm Sunday in 1344. [6] [7] [8]

My Take by Alex Shrugged
The Granada Muslims will take the city back in 1368 and destroy everything, including the church. Ultimately Granada will surrender to King Ferdinand and Queen Isabella in 1492. The church will be rebuilt in 1738 and remains standing to this day. [9]

This Year on Wikipedia

Year 1344, Wikipedia.

See Also


  1. Hughes, A. and Crump, C. G. and Johnson, C., The Debasement of the Coinage Under Edward III. The Economic Journal, Vol. 7, No. 26 (Jun., 1897), Royal Economic Society. pp. 185-198.
  2. Florin (English coin) - Wikipedia, 2014 [last update]
  3. Half Florin - Wikipedia, 2014 [last update]
  4. Quarter Florin - Wikipedia, 2014 [last update]
  5. Gresham's law - Wikipedia, 2014 [last update]
  6. Beck, Sanderson. Castile, Aragon, Granada, and Portugal, 2011 [last update]
  7. Siege of Algeciras (1342-44): Blockade and capitulation: Jan-Mar 1344 - Wikipedia, 2014 [last update]
  8. Doubloon - Wikipedia, 2014 [last update]
  9. Granada: Nasrid Dynasty, Emirate of Granada - Wikipedia, 2014 [last update]

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