Herald of Steel

Lady Parthia, posed with a serious question challenging her intellect and ability, could be seen struggling quite intensely trying to come up with a good answer.

She felt the reply was obvious, but quickly sensed that the man before her would not be so easy to please.

Hence she began to think deeper and longer, determined to knock the smug smile off the hateful boy’s face.

All the while Alexander kept a gentle smile plastered on his face. It exuded no pressure, yet, soon, Lady Parthia was unable to bear it.

“Well… that’s obvious!” Hence after a bit, she burst with a sort of defensive tone, imperiously lifting her index finger,

“For one- the reason why people don’t buy grains simply off the farmer because then they would grind and mill it themselves. They would rather have the farmers do this and pay a bit extra.”

“As for you asking why no farmer sells wheat at exorbitant prices, hmmm.. how foolish! If any farmer tried to sell for such prices now, no one would buy it. The only reason they can sell it for such a price during a famine is because all the rich nobles buy up the grains, leaving the regular people to starve, those greedy pigs!”

As Lady Parthia spat this, her anger suddenly shifted from Alexander to those nobles, making the man guess that previously the royal court must have been pretty bothered by this type of panic buying during various crises.

In fact, he even noticed Lady Parthia clenching her fist and almost jumping up from the couch as she said this, laying further credence to his thought.

“Mmmm, yes, Your Highness’s idea is headed in the right direction,” And seeing this, Alexander quickly nodded his head in agreement, not wishing to anger the queen any further. She looked like really needed the win.

So Alexander quickly also spoke up in support of her,

“Indeed, nobles buying up the limited grain is indeed a problem. It simply causes more misery. I am even thinking of passing a law forbidding such things during a famine, and making it punishable by death!”

And these words seemed to placate the other side a bit, so Alexander quickly brought the discussion back to the topic,

“But may I ask if Your Highness has thought about why nobles buy up grains during such times? Of course, the answer is to make sure they do not starve and also make a profit…. but why do they not do it during normal times too?”

Lady Parthia subconsciously raised one of her sharp eyebrows because the question seemed too simple, and was about to quickly reply it was because there was no shortage of grain so it would not be profitable, but Alexander beat her to the punch, saying those exact words, and then expounding on it,

“…. In other words, we can say during a famine, the grain supply decreases but the demand for grain remains the same… people still eat the same amount. No, in fact, I would say the demand increases because people start hoarding grain…. because they do not know when the next harvest will come.”

“All this causes the already soaring prices to skyrocket. Nobles buy grains at prices they would have never even considered or even outright seize them, while peasants are known to sell their kids for just a single sack of grain.”

As Alexander retold these realities, Lady Parthia’s face turned solemn and bitter, because she had experienced these exact situations before. And it had caused her and her husband endless headaches back in the day.

While Alexander finished his statement upon drawing the following conclusion-

“So if we were to put all these observations into simpler words, we can say that it is the supply and demand of a good that determines its price. When demand increases, prices fall and vice versa.”

“….” As Alexander finished with a sort of smug look on his face, Lady Parthia and Lady Nanazin both turned to give him a nodding look, as if agreeing with his conclusion.

However, they did not seem too impressed, because even though they could not present the theory as beautifully as Alexander, they instinctually knew this. For example- they understood letting more people sell the same stuff tended to bring prices down.

“Is that all?” Lady Parthia henced even chimed from the side, her voice still quite cold, and eyes dark.

“Hehehe, of course not, of course not.” While Alexander quickly replied with flashing palms, as if pleading for the queen’s patience.

“The reason for me taking so long to make this one point is to explain another phenomenon and show how many things in an economy are connected.”

“Let me read out another quote from the book Your Highness. Here, the esteemed minister has this to say about merchants-

‘These merchants… they take goods from one place and then sell it in another place for thrice the price. Sometimes they will also lend out money and charge a bit extra as interest. They produce nothing and contribute little to society! They are a nuisance!’

“Now let us focus on the first line for now. If we apply the rule- ‘Supply and demand affect prices’, then it perfectly explains their behavior.”

“A merchant might be able to buy pottery cheaply from one village that only produces pottery- so they have very high supply and low demand, and then sell them for a high price to another village that only produces metalworks, so there is a high demand but low supply.”

“Similarly the merchants can do it in reverse- buying metal goods cheaply from there and re-selling the now rare goods to the pottery village for an increased price.”

“This happens not because merchants are greedy or evil, but because an ‘Invisible hand’ has directed the actions of three parties with none of them even realizing.”

“All these groups have acted in their best interest- the potters get to sell their vases and pots for money, the blacksmith villages get to buy pottery for cooking, storing, and serving food, and the merchants get a small amount for their effort in satisfying both parties. And thus, it is through each party working for their own self interest that we get somehow a result that fulfills the needs of everyone.. like an invisible hand was guiding them.”

“….!!!….” Phrases like the ‘invisible hand’ and ‘self interest’ were too new and novel to the two queens, and as they tried to figure out their meaning from the context, they suddenly felt their minds broadening.

So many things that previously appeared dark and obscure, so many questions about why merchants and peddlers did the things they did now seemed to become so clear.

It was almost like a fog was being lifted from their eyes, as proven by Lady Nanazin lightly muttering to herself, “So that’s why different places have different prices…”

There was a sort of aura of enlightenment in her voice.

While from the side, Alexander naturally detected such dawn of realization surfacing on the two ladies’ faces, and decided now was the time to make his next hammer blow.

So straightening his back up, his loud, firm voice once again echoed across the chambers-

“Your Highness, it is because of such true examples that I strongly disagree with the book’s author labeling the merchants as nuisances to society. Instead, I think it is the complete opposite, I think they are the most useful part of society. Because they help people from all over the country get all the things they want.”

“Take for example a village deep in the mountains.. who live by only farming. We actually have some such settlements in the Cisran Hills.”

“These villages have no iron ore and no blacksmiths to make plows or hoes with. So what would they do if merchants stopped visiting them? They would probably starve because they wouldn’t they able to use their plows and tilt their field. And similar problems would happen if they could not buy clothes, wine, salt, jewelry, and even papyrus. In this way, they are indirectly all dependent on merchants for their lives.”

“Thus I believe merchants help cities and towns thrive, letting people from one place sell their produce in exchange for goods from other places that they cannot produce by themselves.”

Lady Parthia and Lady Nanazin listened to Alexander explain the role of merchants with nearly a stunned gaze, their ears almost ringing from this revelation.

All this might sound very elementary to us, but for them, it was mind blowing.

Because they had never been given such a ‘holistic’ view of how things worked.

Previously, Alexander connecting the reason for regional price differences was already grand enough, and now for him to show the role of merchants in the society, something that was not only not understood, but completely misunderstood…

Even that famous book only listed observations, not what they meant or why things happened as they did.

Hence to both of them, this seemed like the first time they truly understood the mechanisms of a market.

“But… but… even if the villages and towns need to trade.. why use merchants? Why can’t they do it for themselves?”

However, it seemed that Lady Parthia was still unwilling to admit defeat, and thus made this desperate last attempt.

To which Alexander simply chuckled.

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