The Prosperous Era of Longwan

"There is definitely an outflow, but the reason is not necessarily this. There should be a large amount of silver entering.

Wei Guangde said.

Naturally, this cannot be false.

Merchants seeking profits naturally discovered the huge arbitrage space brought about by the price difference between gold and silver between the Ming Dynasty and Japan.

As for the existence of this kind of arbitrage space, they will naturally find ways to use it to obtain benefits for themselves.

However, Wei Guangde believes that the change in gold prices in the Ming Dynasty was mostly caused by the large amount of silver imported by the Japanese and Yi people.

In this regard, Wei Guangde did not intend to hide it, but said what he thought.

“However, judging from the intelligence collected by Jin Yiwei, it is an indisputable fact that the Yi people were collecting gold wantonly in the Ming Dynasty and the Japanese country and transporting it away.

If it's just a small amount of outflow for trade reasons, that's fine, but if it's a barbarian seeking profit, it's crazy to take away gold from our Ming Dynasty."

When Zhang Juzheng said this, his voice suddenly stopped. He didn't know how to continue.

Zhang Juzheng was not a pedantic scholar, he was a more pragmatic official. Although he could not understand what kind of harm it would do to the Ming Dynasty if the gold was taken away by the barbarians, his instinct still told him that he could not let such a thing happen.

"But they also sent silver."

But at this time, Liu Shouyou suddenly interrupted.

But as soon as the words came out of his mouth, Liu Shouyou couldn't help but regret it. He just listened to the two elders talking about things, why did he interrupt.

If it weren't for the elder Ge in front of him, he would have wanted to give himself a slap in the face so that he would remember it for a long time.

Not only Liu Shouyou, but also Zhang Juzheng was reminded.

Previously, I only thought that the outflow of gold might be detrimental to the Ming Dynasty, but I forgot that when people came to trade, they also brought a large amount of silver. In exchange for the Ming Dynasty's goods, the rest was exchanged for gold.

But if trade with overseas countries is prohibited, what will happen to the output of those workshops?

You know, in recent years, many workshops in Jiangnan have expanded production and recruited many landless refugees to work in the workshops.

In any case, the expansion of production in the workshop is good for stabilizing the place.

But once the trade with the barbarians is cut off, these workers and workshops will be ruined and problems will arise.

Just now, the first solution Zhang Juzheng thought of was to cut off sea trade and not trade with the foreigners.

But when he saw Wei Guangde out of the corner of his eye, he knew that this method wouldn't work.

Wei Guangde was the main advocate of the implementation of sea trade at the beginning, and single-handedly promoted the opening of Yuegang to the sea. He should definitely not agree at this time.

Thinking of this, Zhang Juzheng had an idea.

The problem was caused by the policies introduced by Wei Guangde. Should Wei Guangde solve it by himself?

Thinking of this, Zhang Juzheng said to Wei Guangde: "Shandai, look, it was you who tried your best to promote what happened in Yuegang.

But now something like this is happening. Although I don't know the harm to our Ming Dynasty caused by the Yi people's extortion of large amounts of gold, I must find a way to prevent this matter.

Whether it's porcelain, silk or tea, it's okay to sell it to the barbarians, but gold still needs to be controlled. "

Zhang Juzheng clearly threw the blame to Wei Guangde, but Wei Guangde also knew that he had to take it, otherwise the opening of the sea might once again become a reason for criticism from courtiers.

In fact, from the Longqing Year to the present, there are still officials who talk about Kaihai and think it violates the ancestral system.

It's just that the person who spoke is not in a high position of power, and the person who is really in a high position also knows that the cabinet unanimously supports the matter, and it is useless to oppose it, and it is not worthwhile to offend Mr. Wei Ge.

But Zhang Juzheng's words also made Wei Guangde understand that Zhang Shoufu really didn't understand the impact of gold and silver, or a country's currency on a country.

He said in his heart that it seemed that he needed to explain the matter clearly to Zhang Juzheng, lest he remain in the fog.

However, out of the corner of his eye, he saw Liu Shouyou on the side, and Wei Guangde wondered in his heart, should he also know?

He brought Liu Shouyou here just to show that this matter came from the Jinyi Guardian and that he had nothing to say to others.

If Liu Shouyou is sent away and he comes back with something, there is no way people will accuse him of hiding it.

Forget it, let him understand, so that Jin Yiwei can have a clear direction when collecting information.

"Uncle, brother, and Siyun, you may not have thought through the dangers of the barbarians extracting large amounts of gold yet, so I will briefly explain this first."

Wei Guangde opened his mouth, intending to make things clear first.

So, he continued: "As I said before, the Yi people obtained gold from the Ming Dynasty and the Japanese country. This clearly shows that they are short of gold, but why?

Just because they like gold more than we do?

I can't see it.

I understand that people are also eager for gold and silver, and gold has been more expensive than silver since ancient times. Obviously there is a reason.

I won’t say why gold and silver are exchanged like this, but when the Yi people collected gold from the Ming and Japanese countries, there was a shortage of gold in the two places, and the price of gold in exchange for silver would inevitably rise.

Here, we can make an assumption. Today, the Yi people came to our country, Ming Dynasty, with one hundred thousand taels of silver, bought 50,000 taels of goods, and exchanged the rest for gold. At this time, the price of gold in our country, Ming Dynasty, is one to seven.

I don’t say how much can be exchanged, but in ten years’ time, I know that if the circulation of silver increases greatly and gold decreases, the price of gold will inevitably rise sharply.

By then, I'm afraid it will take fifteen taels of silver to exchange for one tael of gold.

However, this is not the most important thing. The most important thing is if gold is controlled by barbarians, what should we do if they drive up the exchange price of gold and silver when we need gold?

Don't forget, gentlemen, it seems that the Yi people are not short of silver.

What would happen if they set the exchange price of gold for silver at twenty taels or even thirty taels?

Silver, after all, is money. If the people really need so much silver to circulate, that's all.

But what would happen if the people couldn't use so much money?

You two should know that money also has high and low status. This happened in the previous dynasty during the Song Dynasty. "

Wei Guangde said.

The nobility mentioned by Wei Guangde means price in later generations. The purchasing power of a penny in ancient times was also different in different periods.

In the Northern Song Dynasty, the political clarity, population surge, and stable social environment ensured rapid economic development, and the total social output value accounted for one-fifth of the world's total.

A prosperous commodity economic market cannot be separated from the large flow of currency, so the Song Dynasty naturally became the peak period of ancient coinage in my country. There were as many as 43 types of Baowen coins of various eras, and the average annual coinage was 20 times that of the Tang Dynasty. It can be called the crown of all dynasties.

During the more than 100 years of the Northern Song Dynasty, the country minted more than one million coins per year on average, reaching an astonishing five million coins at its peak, which shows the degree of economic development.

Strangely, with such a developed market economy and minting industry, the Northern Song Dynasty suffered from a "money shortage" and often fell into the dilemma of currency shortage and lack of access to department stores.

Throughout China's two thousand years of feudal society, the phenomenon of "money shortage" had already appeared as late as the late Tang Dynasty and the Five Dynasties. It was only due to the highly developed commodity economy in the Song and Song Dynasties that this economic phenomenon was infinitely amplified.

The highly prosperous overseas trade, the increasingly close economic ties with ethnic minorities, and the profound reforms in the tax system all involve currency crises, but ancient China never understood this knowledge.

For the Song Dynasty, the "money shortage" appeared very suddenly, and it was unprecedented and unprecedented. Without the experience and warning of predecessors, it had to rely on its own step-by-step exploration, so the emergence of currency crises was inevitable.

Initially, economic development matched the amount of copper coins minted. At this time, the economy of the Song Dynasty developed unprecedentedly, and all industries flourished, creating a prosperous scene.

At this time, prices in the Song Dynasty were stable, people lived and worked in peace and contentment, and their lives were quite good.

Unfortunately, with the development of the economy, another problem has emerged, that is, "copper is expensive but money is cheap". The copper material used to cast a penny is cheaper than the price of copperware, so many smart businessmen secretly destroy the coins. , melted into more valuable copper and sold, thus making huge profits.

According to documents preserved from the Song Dynasty, one tael of fine copper could be obtained by melting ten copper coins, and the price of the made utensils was five times as much as the original price.

Later, the country implemented the "copper ban" policy, copper resources became even more scarce, and profits increased to more than ten times.

Driven by huge interests, a large number of imitators have emerged among the people. Whether they are wealthy businessmen or ordinary people, they have developed the habit of "hiding money". They would rather pile it up at home and gather dust and rust than take it to the market. use.

Even in official money prisons, old money is being melted down to mint new money.

The value of copper coins was lower than the value of its raw materials. A large amount of money was lost silently, turning from currency into goods and flowing to the copper utensil market.

At the same time, a large number of copper coins minted in the Song Dynasty also flowed out of the country, which was another important reason for the "money shortage" phenomenon in the Northern Song Dynasty.

According to the "History of the Song Dynasty: Food and Goods Chronicles", a large number of wealthy merchants and businessmen came in and out of the border customs of the Northern Song Dynasty every day. When they went out, they were loaded with trucks and ships of currency, and when they returned, they brought back a large amount of goods from beyond the Great Wall and overseas.

Day after day, year after year, a large amount of Northern Song Dynasty copper coins flowed to the surrounding barbarians. Naturally, the currency circulating in the domestic market was not enough.

Whether it is the Khitan, Jurchen, Xixia, and Goryeo in the north, or Dali and Tubo in the southwest, various ethnic minority regimes, large and small, are using Song coins for commodity transactions.

This is like the U.S. dollar and RMB in later generations. The reason why they can be widely circulated in countries around the world is precisely because of the prosperous import and export trade between China and the United States.

Although the Song Dynasty enacted a series of laws to restrict the outflow of currency, it was still banned repeatedly. This is why no matter how many copper plates the official workshop casts, it is not enough.

There was a shortage of money among the people. Naturally, the purchasing power of copper coins also changed at this time, that is, prices rose.

A group of insightful people, including Li Gou and Wang Anshi, realized very early that the root cause of the "money shortage" chaos in the Northern Song Dynasty was essentially due to the fact that the face value of copper coins was lower than its actual value.

Starting from this crux, the Northern Song Dynasty carried out multiple currency reforms, mainly in two directions: one was to reduce the raw material value of currency, and the other was to increase the face value of currency.

The first thing the Northern Song Dynasty court thought of was to make a fuss about the quality of copper coins.

For example, copper coins are mixed with other metals. "History of the Song Dynasty" records that Xu Shen, who was the judge of Sansi Duzhi at the time, suggested to the court that iron and copper be mixed to reduce the copper content in the currency.

A copper coin can be made up of three parts copper and six parts iron, with the remaining one part doped with cheap metals such as lead and tin.

Unexpectedly, when it was put into production, it was discovered that the success rate of this method was too low. It took more than a month to create 10,000 coins. The mint workers were miserable, and this plan also failed.

Later, the amount of small coins cast was reduced, and large coins, iron coins, etc. were cast instead, which were relatively material-saving.

In fact, Cai Jing, the prime minister of the Northern Song Dynasty, improved this idea and used black tin and white tin mixed in liquid copper to make "tin coins" and promoted them in Shaanxi.

But with Cai Jing being deposed, this new currency, which had just been in circulation for two years, was also abolished by the court.

Compared with the first method, increasing the face value of currency is undoubtedly a more scientific and effective method.

Sure enough, not long after the "two yuan discount" became popular, the "money shortage" crisis in the southeast region finally began to ease, and both the central government and the common people really tasted the benefits.

From then on, whenever the Song Dynasty encountered a "money shortage", it would continue to use this method, and successively introduced three-dollar banknotes, ten-dollar banknotes, etc., until later it issued the world's first paper currency, Jiaozi, ahead of Europe. Nearly three hundred years.

Although the emergence of Jiaozi was regarded by later generations as a revolution and a very advanced revolution, it was actually a helpless move at the time.

Before and after the money shortage occurred, due to the imbalance of money supply, prices skyrocketed and people were in dire straits.

On the one hand, there was a large outflow of copper coins, and the number of copper coins circulating in the market was tight; on the other hand, commodity prices soared, especially during the Huizong period, when severe hyperinflation broke out.

Take grain prices as an example. During the Xining reign of Emperor Shenzong of the Song Dynasty, the price of rice averaged seventy or eighty yuan per dou. By the Jingkang reign, it had reached "two thousand dou of rice", and even "tens of thousands of dou of rice" occurred.

The coexistence of "money shortage" and inflation is actually a very strange phenomenon. It is said that with little currency circulation, prices should fall.

However, the demand for currency in the Song Dynasty was too great, so a large number of bad coins appeared. For example, iron coins were exchanged for copper coins at a price of one to ten.

In order to alleviate the shortage of copper coins at that time, the Song Dynasty government stipulated that iron coins were allowed to circulate in Shu, but the amount of circulation must be based on the ratio of iron coins to copper coins.

The circulation of iron coins alleviated the scarcity of copper coins to a certain extent, but the excessive casting of iron coins directly led to the serious depreciation of iron coins and soaring prices.

As for Jiaozi, who appeared at the end, it sounds good to facilitate large-scale transactions, but in fact it is to relieve financial pressure.

In the Northern Song Dynasty, border troubles were serious, military expenditures continued to increase, and in the later period, the palace was extravagant and wasteful, officials were corrupt, and redundant officials' salaries and rewards increased, which finally caused a crisis in the national finances.

The country had no money, so it decided to make friends.

The real inflation in the Song Dynasty occurred after the government began to issue banknotes, that is, after the official banknote issuance agency "Yizhou Jiaoziwu" was established, the fixed denomination of Jiaozi was stipulated, and iron money was used as a reserve for Jiaozi.

In the past, a large number of bad coins caused prices to rise. But when the court chose to solve the financial crisis by discovering Jiaozi, the situation became out of control.

It can be said that Wei Guangde's description of the change from expensive to cheap money in the Song Dynasty can completely replace the situation in the Ming Dynasty at this time.

The economy of the Ming Dynasty is relatively stable now, but what impact will a large influx of silver have on the economy?