The great hero of the Silk Road, starting from a farm farmer

Chapter 273 Banknotes and Banknotes

Song Yingkui, who was not sure which link was the problem, felt a bit at a loss as to what to do. The reserve silver was arbitraged, which really touched his blind spot in knowledge, and there was no ready-made method to borrow.

But this thing must be solved as soon as possible, otherwise the entire Yungu will be in a crisis of no money before long.

"Commander, how about we add [-]% to [-]% of the copper and lead in the silver coins and cast some silver coins containing more copper and lead to offset the arbitrage?" Faced with the silver dollar arbitrage, Guo Kaifeng came up with an idea that was not his idea. idea.

He felt that Yungu's silver coins were arbitraged mainly because the quality was so good. In this case, he would get some inferior quality ones. On the one hand, it would dilute the cost of silver coin casting, and on the other hand, it would reduce the enthusiasm of merchants for arbitrage.

"No! Taking the initiative to lower the quality of silver coins will break the trust of the people and cause confusion in the value of the coins. Such actions outweigh the gains and losses and must not be used."

Without even thinking about it, Song Yingkui categorically rejected Guo Kaifeng's bad idea.The composition of silver coins has changed, and ordinary people can see at a glance that using this method to fill water is deceiving oneself and others.

This will cause the monetary reputation system that was finally established to quickly collapse and disintegrate.Currency is closely related to people's lives, and problems must not be solved by downgrading its quality.

"Let's do this. From now on, Tongdui Commercial Bank will adjust the exchange ratio between silver coins and copper coins. 650 Wen Dazheng coins will be exchanged for one silver dollar." After pondering for a long time, Song Yingkui felt that the problem was that the exchange ratio between copper coins and silver coins was too rigid. Since Everyone felt that the silver coins produced by Yungu Zhu were of high value, so they took the initiative to raise the exchange rate, making it unprofitable for merchants who arbitrage, or even lose money, to see how they would continue to arbitrage.

"Isn't this possible? If so, wouldn't it forcefully increase the price of our silver coins? Wouldn't the iron coins in the hands of the people become worthless? When spending money in the future, the officials and the people will only recognize silver coins and not iron coins. !" Upon hearing Song Yingkui's method, Guo Kaifeng quickly stopped him. You are kidding, this method is not as good as his own idea.

Degrading the quality of the silver dollar can at least protect the reserve silver in hand. Once the exchange rate is adjusted, won't the iron money become a hot potato?Once the credibility of iron money collapses, the phenomenon of silver dollar arbitrage will only become more serious.

"The military government issued a document canceling the exchange system between Dazheng's money and self-cast iron money in Yungu. From now on, regardless of tax collection or trading, Dazheng's money will not be recognized in Yungu, only self-cast iron money and silver coins, and one or two Zheng official silver The ratio of two Yungu silver dollars remains unchanged. What we have improved is the exchange rate between copper coins and silver dollars. The exchange rate of five hundred iron coins to one silver dollar will always remain unchanged!"

Seeing that Guo Kaifeng might have misunderstood his idea, Song Yingkui hurriedly explained.

During the explanation process, Song Yingkui finally figured out where the problem lay.After working on it for a long time, it turned out that the confusion of monetary policy caused Yungu to naturally form a copper-standard value system.

The copper-based value system finally began to impact the forced binding relationship between silver dollars and iron coins.In this case, the exchange relationship between Dazheng copper coins and Yungu coins should be abolished directly, and the monetary value system should be forcibly adjusted to the silver standard to prevent silver coins from being arbitraged. "Iron coins and Dazheng coins will no longer be exchanged? Will it affect the people's tax payment and trading? The copper coins in the hands of our people are worthless!" Seeing that Song Yingkui wanted to cancel the exchange policy for iron coins and copper coins, Guo Kaifeng was a little confused. I wonder if this method is feasible!

"Nowadays, all affairs in Yungu are based on iron coins and silver coins. People mostly use iron coins, and copper coins are also used, but less. The cancellation of the exchange relationship between iron coins and copper coins will have a huge impact. Control, nothing to worry about!
Another point is that our transactions with Dazheng, both official and civilian, are mainly for bulk goods, and are generally settled in silver coins. Copper coins are rarely used, so the impact is also controllable.From now on, no matter which force you trade with, you will use silver coins and iron coins to settle your transactions. Copper coins can only be used as a reference and should no longer be treated as real money! "

At least, I have been minting money for many years. The circulation of iron coins and silver coins is guaranteed. There is no need to worry about the impact on people's livelihood after the cancellation of iron coins and copper coins.Rather than letting the coins you mint depreciate or be arbitraged, it is better to let the money minted by others depreciate.

To put it bluntly, once this policy is implemented, the currency relationship between Yungu and Dazheng will be completely decoupled. This is a natural phenomenon and cannot be made up of.

After determining the core idea of ​​​​solving the problem, Song Yingkui decided to do nothing but launch the banknotes that he had planned for a long time.

On the basis of silver dollars and iron coins, four types of paper money were introduced: one cent, ten cents, fifty cents and one hundred cents.Among them, the one-cent banknotes were used as auxiliary coins for iron coins, and one iron coin could be exchanged for ten-cent banknotes.The remaining three types of banknotes are to solve the inconvenience of carrying iron money.

For ordinary people, silver dollars are not needed for general transactions. The face value of silver dollars is too large, and when the amount of iron coins is too large, it will be very inconvenient to carry.

Another benefit of promoting paper currency is to prevent excessive outflow of iron money.When the mixed use of iron money and paper money forms in Yungu, forces such as Xifan and Beixiang that do not print their own money will adjust their policies and use silver dollars as the value reference currency, instead of latering iron money like now. Use it as copper coins.

Strictly speaking, the banknotes issued by Yungu this time are not currency in the full sense, but are auxiliary coins of the silver dollar. The only real currency in Yungu is the silver dollar.At this stage, it is not feasible to completely replace physical currency with banknotes.

Song Yingkui himself didn't even understand the monetary economy. If he rashly replaces physical currency with banknotes at this time, it is easy to cause problems, and he might develop the bad habit of issuing money indiscriminately!Using the silver dollar as the base currency for monetary issuance will tie up the hands and feet of currency development and curb financial risks!
"From now on, all banks in Yungu that deal with money exchange and deposit-related matters will be renamed as banks and must be registered with the Administration Department. Banks cannot issue deposit notes on their own and must use ones printed by the Administration Department. Standard banknotes are deposited and redeemed. The administrative office must strictly audit the bank's accounts on a quarterly basis to prevent chaos.

For bills used by each bank, [-]% of the face value of the bill must first be pledged to the general exchange bank as a risk deposit. The general exchange bank will pay interest on the mortgage at the rate of [-]% per year.If there is a problem with the bank's money and the bills cannot be redeemed in time, depositors can go to the redemption bank with the deposit bills to redeem half of the face value of the bills in real money to reduce losses!Without registration, any firm or individual is not allowed to operate currency deposit and exchange business.

From now on, large-amount transactions in government offices, the military and government-run industries will be settled mainly with bank deposit bills, and large-amount real money direct transactions will be reduced as much as possible! "

(End of this chapter)