Some back-of-the-envelope musings about silver.
In medieval England, an English penny was (keeping it simple) 1/240 of a pound, the pound in use being roughly equivalent to a troy pound. This is essentially identical to the Roman denarius (which was also 1/240th of a Roman pound), and to many other currencies used in Europe that were also based on the denarius. To consider it really crudely, the same currency (weight of silver) was in use throughout the world for thousands of years, just renamed and with marginal adjustments to weight. Let's consider this the natural currency of civilisation prior to fiat money.
To convert it to the currently common unit of silver, one troy ounce is 20 silver pennies.
Using
this source, plus some maths, we can calculate the value that 1oz of silver would have today had fiat money not been invented.
For instance, one penny would apparently buy two pounds of cheese in the 14th century. Today, 1kg (roughly 2lb) of cheese is about NZ$13 in our supermarkets. 20 pennies (1 oz of silver) would therefore buy 20kg or NZ$260 worth of cheese.
20 pennies (1 oz) would also buy you:
- 40 dozen eggs (about NZ$200)
- 40 chickens (harder to calculate as we don't buy them live, say NZ$200 if live is about half the frozen price)
- just over 1 sheep (NZ$150-250 depending on what sort of sheep)
- 20 pillows (NZ$300 for relatively cheap ones)
- Three tables (several hundred dollars)
- Six chairs (again several hundred dollars if wood)
Considering wages, a labourer would earn 2 pounds per year, ie 24 ounces of silver. At a low-end modern salary of $24,000 to $48,000, that would be $500 - $1000 per ounce.
And from
here, just looking at prices from Britain, 20 pennies would buy you:
- 1.5 times "A ewe and lamb" (one shilling for a ewe and lamb, worth at least $200, so 20d worth of sheep would be at least $300)
- More than a swarm of bees (16d for a swarm, a swarm today being about NZ$200)
- Less than an entire hive (24d for a hive, today maybe NZ$350 given their different hives to the modern ones)
- Five common house dogs (maybe $1000 for really cheap mutts)
This is surprisingly uniform. Basically the old price of silver looks to translate to around NZ$200 / oz by most measures, and if that is in error it is a low estimate as the few exceptions are on the higher side. Today silver is trading at NZ$34/oz.
So it is at least 6 times underpriced.