The thought of facing off against my Great Qing on the battlefield made Liu Huaiwen’s heart ache slightly.
It wasn’t concern for the Great Qing’s survival, but rather for the treasury of my Great Ming, which was already not wealthy. A war would only exacerbate the situation.
Suppressing the urge to borrow money from Zhu Jinsong to buy a cat, Liu Huaiwen took out a stack of paper and some coin-like currency from his怀. He handed them to Zhu Jinsong and said, “Your Majesty, these are the newly printed Great Ming Baochao.”
As Zhu Jinsong took the Baochao and examined them, Liu Huaiwen continued, “These Baochao are printed according to Your Majesty’s wishes, with denominations divided into Yuan, Jiao, and Fen. Yuan and Jiao denominations are paper Baochao, while Fen denominations are coins made of hard metal.”
“One Fen can be directly exchanged for one Wen. Both are the smallest denominations. One Yuan is equal to one hundred Wen, and ten Yuan is equal to one Liang of silver.”
Zhu Jinsong hummed in response, continuing to look through the Baochao and coins in his hand.
The denominations of the Baochao were unremarkable. From hundred-Yuan notes to Jiao change, they covered the daily needs of ordinary people and merchants. Their design was similar to modern currency, with the only difference being that the Baochao were larger in size, whereas Chinese banknotes were smaller.
Zhu Jinsong was not overly concerned about anti-counterfeiting measures.
The anti-counterfeiting technology developed by the top scientists and craftsmen of the Great Ming, while not significantly advanced, was about three to five years ahead of the rest of the world. In three to five years, new anti-counterfeiting technologies would emerge, so there was nothing to worry about.
Moreover, the Imperial Guards, the Censorate, the Court of Judicial Review, as well as local governments and farmers' associations, were not to be trifled with. The punishments for counterfeiting in the Great Ming Law were severe, and it was unlikely anyone would dare to risk implicating their entire clan for nine generations.
Compared to anti-counterfeiting, Zhu Jinsong was more concerned about the new Fen-denominated currency.
The new Fen-denominated currency was similar to old copper coins but not entirely. Only the size and weight were similar; the color and design were vastly different from the old copper coins.
The old copper coins were mostly made of brass mixed with a small amount of other metals, and their color tended towards the natural color of brass. They were mostly round on the outside and square on the inside, reflecting the concept of "heaven is round, earth is square," and also convenient for stringing together with rope.
“The coins in the capital reached trillions, but the strings rotted, making them impossible to count; the grain in the imperial granaries was old and accumulated, overflowing and exposed, even to the point of rot and unsuitability for consumption.”
Rotten strings meant that the coins pierced by the strings scattered on the ground, making it impossible to count their quantity.
The surface of the copper coins usually bore the inscription “Mou Mou Tong Bao” on the front and some pattern or nothing on the back. Only the copper coins of my Tartar Qing had the inscription of “Mou Mou Tong Bao” in Manchu script on the back.
The coins in Zhu Jinsong’s hand had denominations such as one Fen, two Fen, five Fen, and one Jiao printed on the front, with the words “Great Ming Royal Bank” written in very small characters on the side. The back featured different patterns, with the words “Year 4486 of the Yellow Emperor’s Calendar” below the patterns.
Apart from the level of exquisite craftsmanship, the characters, denominations, and metals used, they were no different from Chinese coins.
After admiring and playing with them for a while, Zhu Jinsong ordered, “Let’s begin. It’s about time our Great Ming’s currency undergoes reform.”
It was amusing to think that Zhu Jinsong had already occupied sixteen provinces, yet these sixteen provinces still used silver and the copper coins of my Tartar Qing.
Zhu Jinsong was not unaware of the importance of currency rights, nor did he want to issue his own paper money.
If this were another transmigator, they would likely have been busy improving the currency after occupying Shandong or even just Yizhou. However, Zhu Jinsong had not bothered with this, considering it utterly nonsensical.
Had he considered anti-counterfeiting technology? Had he considered the possibility of counterfeiting? Had he considered the acceptance of the issued paper money?
Setting aside other factors, the anti-counterfeiting technology alone was crucial. Without world-leading anti-counterfeiting technology, if my Tartar Qing were to mass-produce counterfeit currency and flood the market, the newly issued paper money would immediately become worthless.
Furthermore, without a strong regime to back the paper money, who would accept it? It was common knowledge that Uncle Sam had used the greenback to harvest the world’s韭菜, but did he have the same strength as Uncle Sam?
Do not use the border region currency as an example. The success of the border region currency was due to the good credit of the government under the administrators. The collapse of the Nationalist currency and the gold yuan currency issued by Chiang Kai-shek led to the widespread acceptance of the border region currency.
If Zhu Jinsong had issued paper money early on, when he only occupied one province, it was likely that no one besides Zhu Jinsong himself would have recognized its currency attribute.
This was because the silver and copper coins of my Tartar Qing were precious metals themselves and possessed intrinsic monetary value. What did paper money have?
Let’s not forget that in terms of playing with paper money, our Central Plains sect was the progenitor worldwide.
As early as the Song Dynasty, the Central Plains sect had the semi-official, semi-private Jiaozhi. By the Hongwu era, there was already the imperial issuance of Baochao, and the common people had witnessed paper money and had long lost confidence in it.
More importantly, currency has never been a case where good money drives out bad; rather, there is the risk of bad money driving out good money. Promoting new currency is not as easy as imagined.
Therefore, Zhu Jinsong had not rushed the matter until he had secured sixteen provinces. Only then did he begin preparations, gradually working on currency, banks, and the treasury. Once everything was almost ready, he decided to reform the fiscal and monetary system of the Great Ming.
…
In the year 4487 of the Yellow Emperor’s Calendar, corresponding to the 55th year of Qianlong, the fifth year of Zhu Jinsong’s reign as emperor, it was commonly referred to as “Sacred Emperor Year Five” by the common people.
Zhu Jinsong did not know how the era name “Sacred Emperor” came about.
Not to mention that the Great Ming had completely switched to the imperial calendar, Zhu Jinsong could not possibly use the words “Sacred Emperor” as his reign title. What kind of shameless person would do such a thing? Even the emperor of my Tartar Qing had never used such a grand reign title!
The critical point was that the people of the Great Ming recognized this reign name. Many, upon seeing the Yellow Emperor’s Calendar, would habitually ask, “Which year of the Sacred Emperor is it this year?”
Later, local government offices, when posting official documents, would habitually add an explanation: “This year is the Xth year of the Sacred Emperor.”
Of course, the reign title had no bearing on the merchants. However, the fiscal and monetary reforms first affected merchants, especially with the establishment of banks.
As the spring tax for “Sacred Emperor Year Five” was to be collected in a few months, the merchants of the Great Ming had already prepared their account books and silver. In the Great Ming, tax evasion was considered a serious crime, with a popular saying that “evading taxes for a while brings joy, but a funeral pyre for the whole family.”
Therefore, whenever the tax season arrived, the merchants of the Great Ming treated it as a major enemy, repeatedly checking their account books and tax silver to avoid any issues being discovered by the authorities.
However, when it came time to collect the spring tax for “Sacred Emperor Year Five,” the merchants of the Great Ming were stunned. The government no longer directly collected the spring tax. Instead, merchants were required to deposit their taxes in newly established banks. When these merchants found the newly established banks, they were informed that the banks did not accept silver and copper coins, only the newly issued Great Ming Baochao.
If they didn’t have Great Ming Baochao? They could exchange them at the nearby window. One Liang of silver could be exchanged for ten Yuan of Great Ming Baochao. Ten Liang of silver could be exchanged for a hundred-Liang Baochao. After exchanging for Baochao, they could then pay their taxes.
The merchants of the Great Ming were bewildered. Exchanging silver for Baochao first, and then using Baochao to pay taxes, what was the difference between that and defecating after taking off their pants?
One Wen of copper coin could be exchanged for one Fen of new currency, and one thousand Wen or one Liang of silver could be exchanged for ten Yuan of new currency. The reverse was also true with the same exchange rate. These merchants suddenly discovered a fatal problem.
The currency arbitrage that was originally sufficient to make them rich had been eliminated.
Although the Great Ming originally recognized copper coins and silver, the exchange rate between copper coins and silver varied in different regions. Some places exchanged eight hundred Wen for one Liang of silver, while others exchanged over one thousand Wen for one Liang of silver.
Of course, these two places might have been far apart, such as the distance between Shandong and Guangdong. However, in the face of gleaming silver, distance was no issue.
For example, if one earned eight hundred Wen in a place where the exchange rate was eight hundred Wen to one Liang of silver, and exchanged it for one Liang of silver, then went to a place where the exchange rate was one thousand Wen to one Liang of silver, and exchanged it for copper coins, returning to a place where the exchange rate was eight hundred Wen to one Liang of silver would yield an extra two hundred Wen.
However, with the new monetary policy implemented by the court, this currency arbitrage was forcibly smoothed out. No matter how wild the merchants’ methods were, they could not compete with the bank branches spread throughout the Great Ming, and the bank’s exchange rate was uniformly one thousand Wen for ten Yuan across the Great Ming.
Following this, these merchants received another bewildering piece of news.
All industries controlled by the Great Ming court would no longer accept gold, silver, or copper coins, only Baochao. However, merchants with cooperative relationships could settle in Baochao or gold and silver without issue, with only a “very, very small” handling fee charged for gold and silver settlements.
At this point, although the court had not yet announced the complete abolition of the original silver and copper coin system, these shrewd merchants, who were more perceptive than monkeys with fur, had already seen through everything.
The court intended to reform the currency, replacing the existing monetary system with the Great Ming Baochao.
Fortunately, the Great Ming court under Zhu Jinsong was well-prepared in this regard.
Firstly, the Great Ming court did not mandate the immediate cancellation of the original currency but rather promoted it gradually through taxation.
This alone caused many merchants to breathe a sigh of relief. They feared that the Great Ming court would issue Baochao, but the government would not allow merchants to use Baochao for tax payments.
Secondly, many merchants relied on the industries controlled by the Great Ming court to earn money. Therefore, even if they were unwilling to accept the Great Ming Baochao, they had to use Baochao when doing business with these court-controlled industries.
Coupled with the widespread bank branches that directly offered exchange services, making it convenient for merchants of the Great Ming to exchange between gold and silver and Baochao, this provided an additional layer of security for Baochao.
With multiple measures taken, the value of Baochao was immediately reflected.
Of course, currency reform was not solely dependent on the Great Ming court endorsing Baochao, nor was it solely dependent on the merchants of the Great Ming accepting Baochao.
The Great Ming court endorsing Baochao only guaranteed the value of Baochao, while the merchants of the Great Ming accepting Baochao only accelerated the circulation speed of Baochao within the Great Ming.
However, currency reform was not just an internal matter for the Great Ming. England, France, the United States, and many other countries had trade with the Great Ming, which involved exchange rates and international settlement issues.
For example, the exchange rate between the RMB and the USD. If analyzed solely from trade surplus and deficit, then the more exports, the lower the exchange rate would be, which would be beneficial. The more imports, the higher the exchange rate would be, which would be beneficial.
However, this analytical approach was not applicable to the Great Ming.