Secret knowledge was a lot more realistic back then.

If you were the ONLY person that knows how to turn base metals into gold, you can still be rich beyond all reason.

Why? They make diamonds in the lab.

Not if you're the only one who knows and can create artificial scarcity.

Did you know that actual historical alchemy was often banned by various kings and monarchs? They did so not due to superstition, or because alchemy didn't work. Rather, they banned alchemy because it DID work.

We now know that you cannot use chemical reactions, however complex, to turn base metals like lead or copper into silver or gold. However, you can use alchemy to give these base metals the appearance of silver or gold. Alchemists could coat coins in durable coatings that would appear to be like silver or gold. Dip a copper coin in the right solution and it will take on the appearance of gold. And you can then take that coin out of the solution, clean it thoroughly, and the faux-gold treatment will remain. It's not just a layer of paint resting on the surface; the upper layers of copper atoms have actually chemically reacted to produce compounds that give the appearance of gold or silver.

So, even though alchemy didn't work to truly turn lead into gold, from the perspective of a monarch, that didn't actually matter. Because when it comes to currency debasement, making a fake gold coin so good that it fools people is just as good as making real gold. The alchemists couldn't turn create real gold coins, but they could create counterfeit gold coins that could be quite convincing in the right circumstances. They didn't need to create a forgery that could fool a modern PhD chemist with a lab full of equipment; they just needed something that could fool an illiterate 12th century merchant at his shop. The process:

1. Take a mold or press a stamp of one of the king's official gold coins.

2. Use the mold or stamp to cast, press, or forge coins out of cheap metals like copper or tin.

3. Apply an alchemical process to make the copper or tin coin look like gold.

4. Spend the counterfeit coin as a real coin.

Coins were a better target than bulk gold like bars. With a bar, you would notice that the "gold" has an incorrect density. But a counterfeit coin, mixed in with a larger number of legitimate coins? Easy to pass off as the genuine article.

Kings often banned alchemists from their realms. Practicing alchemy was often a capital offense. In terms of true elemental transfiguration, alchemy failed. In terms of the ability to create spendable wealth from nothing, alchemy absolutely did work. From the perspective of a monarch looking to protect their currency from debasement, alchemy was a very real threat.

That is a strange take because economics builds on this principle to function. If you found a producing company today it will have to buy a material and - by the magic you apply to it - sell it for more. Like a refinery buying crude oil and selling gasoline. Or a goldsmith buying gold and selling jewellery. It's how everything works.

On a broader take it reveals a Marxian perspective on a market where every item looses its value to the cost of the labor that goes in it. For the alchemist (if everyone found out his Pb->Au secret) the price will drop until it's worth the labor that went in it because everyone else also can't sell cheaper.

So labor is all that has value. And owning the means of production hasn't.

It only becomes unscarce if you tell everyone else how to do it. If you can make gold, and no one else can, then its free money for you.

Lol, I don't think the alchemists were planning on sharing the technique if they found it.

They’ll probably just put an arbitrary standard to differentiate “naturally occurring” gold from the one processed one, just like how artificial diamonds are the exact same thing as the natural one but it’s the blood, sweat, and tears that give it value.

I love that we now actually can turn base metals into gold. It's just incredibly energy intensive so nobody bothers.

Price is not value. Gold is more valuable (useful) than lead, whatever the price. Clean air was cheap and valuable, now it must be created in a lab.

“Mr. Makepeace, do you really turn lead into gold?”

“No, of course not. No one can do that. But if people think you're foolish enough to try, they don't bother to look at what you're really doing. They leave you in peace.” - Lyra's Oxford, Philip Pullman

The trick is only you know how, so you get rich.

It has already been said but I think the author misunderstood alchemists, the idea was only they would have the knowledge. The argument put forward would apply to the entire monetary system, money must be worthless if everyone can make it.

well the understanding of the world was, that everything has a soul like attribute. and they are in a hirachy from close to god to far from god. so gold was inherantly a very close to god metal and therefore inherantly more worth than lead which was somewhat far from good.

So based on that world view of fixed values based on the christian god, they had no reason to belive the economy might suffer.

I always thought about it more in a metaphorical way.

"Alchemists are trying to produce gold (valuable materials) out of less valuable materials."

Alchemy was an explicitly magical tradition.