Siheyuan starts from a better life

Chapter 1163 Private Bonds
The franchise policy was like opening up another source of income for him and Hang Seng Bank. If he disagreed, it would be like being mean to his own money. If you don't make money when you have it, you are a fool.

In addition, Jiang Yan could not stop these things. After all, no matter what, the national government had to find a way to spend the taxes collected, and it must have a channel like a franchised bank.

Banks are the blood of a country. They cannot be cut off and must exist.

But now in Russia, people's hearts have become corrupt. No matter how good a policy is, there will be problems in its implementation. This is human nature, and it is not something that Jiang Yan can change on his own, not even Gaidar and Chubais can do it.

After hearing what Jiang Yan said, Gaidar and Chubais immediately showed joy on their faces.

"Jiang, we mentioned before that we would issue private bonds. What do you think about this?" Gaidar said while the iron was hot.

"Private Bonds"

Hearing this, Jiang Yan couldn't help but rub his temples. He felt a headache. This thing was countless times crazier than franchising. It could even be said that it was this thing that pushed Russia to the brink of death. All kinds of assets were completely opened to the oligarchs, and the entire country was almost divided up by them.

The so-called private bonds refer to the securities privatization plan passed by the Russian Congress, which stipulates that most of the company's shares will be sold to the company's employees and managers, and a small part will be sold to external investors.

The privatization of the big Russian enterprises will transfer the state-owned assets accumulated by the former Soviet Union for 74 years to every citizen free of charge, at a price of 1.49 rubles per person for a population of 1 million. Each person only needs to pay a symbolic 25 rubles to receive a privatization voucher with a face value of 1 rubles, which can be used to purchase enterprise shares or housing, or to entrust it to an investment fund. The voucher is bearer, cannot be reported lost, and can be transferred and cashed.

This is equivalent to distributing all state property worth about 1.5 trillion rubles to the people of the country, and such payment is basically "free". It seems that the people of the former Soviet Union have received real "benefits", but what is the result?
According to materials released at the Russian Duma hearing, from 1992 to 1996, due to hyperinflation, the economic losses caused to the country by privatization exceeded 1995 trillion rubles, calculated at 9500 prices, equivalent to 2.5 times the losses during the Great Patriotic War. After such privatization, 81% of the citizens lost all their savings.

In the planned economy era, the amount of money for property rights transactions and the speed of money circulation were both very low, so the result of the increase in the number of commodities was a sharp drop in prices. In this way, the seemingly fair privatization turned out that ordinary people could only sell bonds cheaply in exchange for cash to improve their lives. Because there was a severe shortage of cash in the specific property rights transaction field at that time, the selling price was extremely low. The low price caused panic and further selling. The people of Mao sold privatization securities one after another, while business operators, wealthy people and foreign capital took the opportunity to buy them cheaply in large quantities. Privatization securities were concentrated in the hands of these people at a very fast speed, so that in the state-owned enterprises that were shareholding, 90% of small shareholders held less than 10% of the shares, while 1% of large shareholders held more than 85% of the shares, greatly exacerbating the gap between the rich and the poor.

Russia has sold 12.5 state-owned enterprises, with an average price of only $1300, a world record low. Russia's 500 large state-owned enterprises are actually worth more than $1 trillion, but they were sold for only $72 billion. In 1996 alone, the losses caused by the privatization of state-owned enterprises were greater than the losses of state property incurred by Hitler's invasion of the Soviet Union.

After Russia implemented privatization, the inflation rate reached 1992% in 2501. The severe inflation that lasted for many years not only caused chaos in economic life, but also brought unprecedented disaster to the general public. In 1992, Russia fully implemented the "shock therapy", which led to economic paralysis, soaring prices, and devaluation of the ruble. Residents lost 4600 billion rubles of savings, prices rose 51 times, and nominal wages only increased 11 times. The price index soared year by year - 1991% year-on-year in 168, 1992% in 2508.8, 1993% in 844, 1994% in 214, and 1995% in 131.4. In the five years of transition, prices rose nearly 5 times. In the following years, inflation declined slightly, but it was still at an extremely high level, 5000% in 1996, 21.8% in 1997, 11% in 1998, and 84.4% in 1999. As a result, 36.5% of the residents' savings from years of hard work were completely wiped out. "This plan is too crazy." Jiang Yan sighed after reading their plan.

There is no other way. We need this kind of privatization now. " Gaidar said helplessly.

Large-scale privatization is an important weapon for them to gain a foothold in Russia and gain Boris's reliance. They know very well that if Boris had not relied on them to reform the economy and had been protecting them, they would have been killed by those old foxes long ago.

So they had to turn Russia into a capitalist country according to Boris's will.

Their original intention was that the public's access to these private bonds would at least give people the impression that all Russians had become the masters of Russia, and would make ordinary Russian people satisfied with Russia, with Yeltsin, and with him.

What they don't know is that inflation occurs in the consumption field of ordinary people, while deflation caused by insufficient money supply in property rights transactions occurs in the capital field of property rights transactions. The profiteering between these two different fields has caused wealth to change rapidly at an extremely high speed. Since people's consumption can be overdrawn, after the privatization plan was introduced, because ordinary people had improper income expectations, they used their previous savings for consumption in advance, and when they got the bonds to buy property rights privatization, there was a huge depreciation.

It seemed that every Russian citizen could receive a privatization certificate of 1 rubles at that time, and could freely purchase shares with the certificate. However, when privatization was officially launched, it was already October 1992. Times had changed, and 10 rubles were only enough to buy a pair of high-end leather shoes. Such devaluation made state-owned enterprises more seriously sold at a low price. Foreign capital and the upper class could control enterprises and become the masters of assets in inflation, and get greater benefits in inflation, which completely turned the privatization process into a gluttonous feast of legal embezzlement of Russian state assets. At the same time, the actual living standards of the people generally declined sharply, and the polarization was very serious. By 1, the unemployment rate was as high as 1999%, and the richest 15.2% of the population accounted for 10% of the total income of all residents. The income of the richest was 45 times that of the poorest, and 48% of the residents did not meet the minimum living standard.

The privatization of a country becomes a playground for international scavengers.

"In our plan, Russia is different from the old capitalist countries like the United States. Their assets belong to each individual, while Russia's belongs to the country. Now that we have capitalism and a free market economy, we must find a way to distribute these properties to everyone." Gaidar said.

"The idea is good, but they ignored the market." Jiang Yan thought about it in his mind, but he did not remind them.

(End of this chapter)