A while back I discussed a comment I read saying that when Caesar crossed the Rubicon, the Roman treasury held 17,410 pounds of gold, 22,070 pounds of silver and 6,135,400 sesterces.
I made a bunch of wild assumptions and estimated that volume of precious metals would be worth about $361M at today’s market prices.
See my post How much wealth was in the Roman treasury in 49 B.C.? How about annual tax revenue under Augustus? I’m going to cross-post this discussion and that previous post to my other blog, Outrun Change.
A reader, Caleb, has expanded the discussion by indicating he thinks the value of gold was dramatically higher back then in relative terms that it is today. He estimates gold was around $7,000 an ounce in today’s dollars. See his comments at the above post for further explanation.
I enjoyed his comments so much I decided to create new post in order to extend the discussion.
First I will rephrase his calculations:
- Sestertuis = 1/4th denarii = $20
- Denarii = 1/25 aureus = 4 sestertius = $80
- Aureus = 3.5 to an ounce of gold = 25 denarii = $2,000
- Gold = 3.5 aureus = $7,000
Price of silver
On Caleb’s idea that value of precious metals were far higher relatively than today, consider this supporting calculation. From Wikipedia:
- Aureus = 25 denarii = 100 sestertuis
- Aureus weighs 8 grams (as Caleb mentioned)
- Denarii is one ounce of silver (imagine hefting a Morgan or Peace dollar)
Look at the content of a denarii – one ounce of silver. We know from a variety of comments in the New Testament of the Bible that a denarii is usually considered to be a day’s pay for a common laborer. So let’s call that a day’s pay in circa 30 A.D.
Translate that back from today. If minimum wage of $7.25 is an approximation of the hourly pay for what could be roughly called a common laborer, then an 8 hour day would gross $58. Adjust for a 10 hour day would be $75 a day. That is radically more than the $16.03 for silver today from the WSJ.
So let’s back into it from the other direction.
A day’s labor today is worth $58. A denarii has an ounce of silver, so it would it should be worth $58 in today’s economy based on metal content alone (yeah, you and I both wish we owned a real denarii! it would be worth a bunch more than $58).
Does that means silver was $58 in circa 30 AD or circa 49 BC?
Yeah, I think so.
That would be consistent with Caleb’s point and his calculation.
Consider the relative values of silver and gold. Gold at $7,000 with silver at $58 would give a relative value of 120:1. Today the ratio is more like 73:1 (calc as $1177.30/$16.03).
Changes in the amount of per capita mining, relative preferences for silver and gold, and other market factors would easily explain that variance. So I agree with Caleb’s point.
So I’ll do those calculations again. Rome had annual revenue of 500 million sesterces.
At the new estimate of $20 for one sesterce, that would be annual revenue of $10 billion dollars.
I previously calculated $7.25 billion.
Money in the vault:
- 17,410 pounds of gold
- x 12 troy ounces to a troy pound
- = 208,920 troy ounces
- x $7,000 new calc
- $1,462,440,000 current value of gold then
- 22,070 pounds of silver
- x 12 troy ounces to a troy pound
- = 264,840 troy ounces
- x $80 new calc
- = $21,187,200 current value of silver then
- 6,135,400 sesterces
- x $20, 1/4th of an ounce of silver
- = $122,708,000 current value of sesterces then
That is about $1,606 million, or about $1.6 billion.
My previous calculation was about $361 million.
How do my calculations look? Did I miss something? Slip a digit somewhere? Drop in a bad assumption? Let me know and I’ll run another calculation.
The next iteration would be to find some way to translate that amount of gold and silver into purchasing power. Like how many cars you could buy. Oh, wait. That won’t work. How about how much food it costs to feed a family or to equip and hire a legion.
Perhaps another day.