The Alchemists finally did it (RAR!)

[Zor]

In this scenario you are the monarch of the Empire of Tsohria. Said Empire's primary territory has 1,000,000 km^2 of semi-tropical land (ranging from mountainous to grassland) and a population of 40,000,000 people living at a mostly 1500s level of technological development (gunpowder and matchlocks, printing presses, simple castle cracker cannons and rockets, clocks, compasses, water powered blast furnace equipped founeries, Junks and similar), with 80% of them living in the countryside, 12% of them living in small towns and 8% of them being city dwellers. In the last fifty years your predecessors sent some conquest fleets to another continent 3,000 km to the east populated by bronze age barbarians, which has added 30,000 km^2 and 1,500,000 people to your Empire. The Empire is divided into thirty seven provinces ruled by a Daimyo which spends half of his/her time in the Imperial City (which has a population of 750,000 people) at court and half of his time managing his estate while his/her family is in the Imperial City and has to consult with an Imperial Monitor (agents of the Imperial Throne drawn from the lower nobility who's job it is to remind them of the Imperial Throne's interests and discourage rebellion). A system of semaphore towers and courtiers have been set up to relay messages across the Empire quickly for both governmental and commercial purposes. You can muster up to a million Ashigaru and Samurai armed with yari, yumi, tanegashima, katanas, war pick, plate armor and so forth, with the best 50,000 of them being retained by the Throne. There are six kingdoms on this continent, each with about 60-40% of your population that generally squabble between each other and are not interested in warfare with you, though they do band together when the Empire attacks one of them. Your nation does have some magical abilities mostly relating to medicine (among them expensive life extending draughts which slow aging down to 25% it's usual rate for a month while repeated consumption bleaches the skin), strengthening steel (mage smiths can make enchanted breastplates that cost four times as much as regular ones but offer the same protection as one three times as thick for the same weight and similar) and similar. In general your nation is fairly well developed for it's level of development and stable.

Your Nation's currency is the Gold Koban, which divides into 32 Silver Ichiban or 1024 Bronze Mons. The Empire's GDP is 362,500,000 Kobans a year and a common peasant has an income of 4 Koban a year. There are banks which deal in this and for centuries the Empire has made use of paper IOUs that can be redeemed in the capital. Gold is about as common on this world as it is on earth. This system has worked for centuries, but is now going to have a spanner thrown into the gears.

For centuries the guild of alchemists has used a combination of magic and primitive chemistry in a quest to find a way to turn common metals like lead or iron into gold and while they have come up with a few useful ideas along the way. Well a few weeks ago some alchemists actually did it. They came up with a set of magical processes which turned an 6 kg cauldron into a smaller version of it that was 99% gold and they've pulled it off repeatedly. For the price of a few Ichiban they can transmute a kilo of material safely and reliably and the resulting changes are permanent. The guild is already covering a lot of their debts by dropping off a lot of transmuted junk at their debtors and have made a life-sized statue of you out of gold as a gift. Already they've made dozens of tonnes of the stuff and plan on making even more. They also have managed to turn iron into copper.

Needless to say the Alchemists are glorying in their golden achievement as they make more and more of the yellow metal. However there will be problems with this development: namely that as the amount of gold they make increases the value of a kilo of gold will go down, and by extension the value of a Koban. Inflation will soon be a big issue for The Empire and the beyond.

What do you do?

Zor

[Zixinus]

I think a safe start would be trying to pull in the alchemist to stop flooding the market with gold (even if only for the short term), if necessary by paying their debts in their place. Try to take control of the alchemists in general. If necessary, declare alchemy a royal science restricted to nobility (and yes, make alchemists nobles, they're probably already are in good number). Force would be counterproductive in this situation, as you want the alchemists with you. Secure the knowledge and means (and people) for yourself as well. Start talking with banks but be prepared for a massive economic upheaval.

Then it depends whether a takeover can succeed at all, which in turn depends on how centralized the alchemists are and how widespread their knowledge their revelation is. I can easily imagine that the news would be spread among all alchemists as quickly as possible, as bragging rights if nothing else (in reality, alchemists identified transmuting elements with enlightenment, indicating that this "success" is much more than it seems but that's another headache).

You will have to draw up plans and start enacting measures to switch away from gold or basing your currency on metal anyway, because that just became massively unstable. Move on to cows as a base unit, if absolutely necessary that you tie your money to something.

[Elheru Aran]

Can transmuted gold be identified as such?

About the only thing though, outside of stringent penalties for attempting to use transmuted gold as legal tender, is switching the foundation of your currency to either fiat money ("this bill is worth this much because I say so and if you try to do anything else you're in trouble") or a different, less counterfeit-able medium.

I suggest the gronch.

[Zor]

Can transmuted gold be identified as such?

Nope. It's just regular Element 79 with some residual impurities.

Zor

[Elheru Aran]

Can transmuted gold be identified as such?

Nope. It's just regular Element 79 with some residual impurities.

Zor

In that case there is no way of avoiding critical devaluation of gold as a currency.

One possible substitute is aluminum, unless the alchemists are capable of creating that-- it used to be quite expensive and rare until modern methods of refining it out of bauxite became a thing.

But overall with the alchemical transmutation of metals becoming common practice, expect metal-work to be highly refined, perhaps leading towards the industrial revolution a bit early. If the Bessemer process can be skipped, that's one way to access large scale iron-working.

An interesting thought might be if alchemy can manipulate metal not so much to change it into another metal, as to give it different properties. Could common puddled iron be cleaned of the slag from the process of melting iron ore into a billet, to make it into pure iron, which then gets a little bit of carbon added to allow it to be hardened with the proper application of temperature? Or can it just be hardened directly by alchemy? That could be highly useful in quite a few different directions.

[Raw Shark]

Assemble a goon squad paid enough for loyalty and stealth. Bribe law enforcement where necessary. Start robbing and killing alchemists. Put schools of alchemy to the torch. Retire wealthy far away before inflation catches up by drinking, smoking opium, and whoring myself to death.