If I fail to overcome the tribulation, I can only return to the Ming Dynasty and become a prince.

Chapter 35 Exchange Reserve

The central bank has the functions of the treasury, but the central bank is not equal to the treasury.

To be precise, the treasury is the government's purse, and the central bank only manages the treasury, so the two cannot be equated.

This is a very clear concept in financial management in later generations, but for the current Ming Dynasty, there is no concept of a central bank, and naturally there is no understanding of the difference between the treasury and the central bank.

Even Zhu Gaochi, an expert with rich political experience, found it difficult to understand the key point at the moment.

However, he did have some ideas when Zhu Zhankun said that the new money bank could not be equated with the national treasury, nor could the money in the new money bank be used casually. However, these ideas were not systematic for the time being, so he did not say them out, just waiting for Zhu Zhanju explained to himself.

"Dad, the new money bank is not the same as the national treasury. This concept must be clarified first." Zhu Zhanju first proposed the concept of distinguishing the new money bank from the national treasury. After getting Zhu Gaochi's agreement, he continued: "Let's establish The main purpose of this new money bank is to absorb the cash in the hands of private merchants through the new money bank, thereby solving the problem of national silver shortage, and using this as a basis to stabilize the currency. To achieve these two points, it is necessary to ensure that there are people going to the banknotes. There is silver in the new treasury, and there is always silver in the new treasury.

This undoubtedly requires the new money bank to have a good reputation among the people to attract merchants to deposit money. At the same time, it must maintain a large amount of cash to give people who deposit money confidence that their money is safe.

But if the country uses the money in the new bank at will, or even uses it as a treasury, then as long as a sum of money enters the treasury from the new bank, the credit of the new bank will collapse, and the people will think that this is just a treasury. The new method for the court to make money was to exchange pieces of paper for money.

Even if the money order can be redeemed in full, it will only make people feel that the court is just getting better this time.

So in any case, the new money bank and the national treasury must be separated, and the circulation of money between the two must have strict rules and regulations. The national treasury can only borrow money from the new money bank, and must repay it with taxes, not Free access. "

"What you said is correct, but how will the new money bank solve the problem of lack of money in the national treasury?" Zhu Gaochi understood what Zhu Zhancheng said, but raised a new question.

The purpose of establishing a new treasury was to solve the problem of lack of silver in the national treasury and allow the court to have money to reform the banknote method.

But now Zhu Zhanjun said that the money in the new treasury could not be used, which undoubtedly made Zhu Gaochi confused and felt that Zhu Zhanjun's words were contradictory.

However, Zhu Zhanjun didn't think there was any problem with this. He explained to Zhu Gaochi: "Dad, you need to understand that silver is not equal to money. What we circulate in the Ming Dynasty is treasure banknotes. This is the money recognized by the court. During the Hongwu Dynasty, the court banned the circulation of gold, silver and copper among the people, so the silver in the new treasury was just silver, not money."

"If you say that, I kind of understand. What you mean is that the new money bank can actually exist similar to the Qianyuan balance bank. The silver in the new money bank is used to stabilize the value of treasure banknotes. So you can't move lightly, right?" Zhu Gaochi was not a mediocre person after all, and he understood what Zhu Zhanquan meant as soon as he explained.

Zhu Zhanjun nodded, and then added: "Father, you are right to understand this. However, the new money bank is not just a balance bank, but will serve as the issuing authority of my Ming Dynasty's treasure banknotes, and use these to deposit new coins." Based on the silver in the treasury, new treasure banknotes that can be exchanged for silver are printed and issued. In order to achieve this, the court not only cannot take money from the new treasury, but also deposits all the silver in the treasury into the new treasury. , used as a reserve for the issuance of new banknotes.”

In later generations, central banks also required reserves to issue currency, but at that time all countries used gold reserves from their countries.

Even in the Yuan Dynasty, there was a reserve when issuing banknotes. The leveling treasury established by the Yuan Dynasty at that time played a large part in this role.

The Ming Dynasty can be said to have inherited the banknote method of the Yuan Dynasty, but Zhu Yuanzhang really had no talent or insight in this area. In addition, the court itself did not have any money, so he simply abolished the regulations that recycled faint banknotes and that banknotes could be exchanged for gold and silver. , directly print treasure banknotes.

However, this was indeed no problem in the early Ming Dynasty. On the one hand, the Ming Dynasty was just established, the country's reputation was pretty good, and the people believed in the court, so the treasure banknotes could still be spent.

On the other hand, there was no excessive issuance of treasure notes during Lao Zhu's time. Generally speaking, it did not cause inflation, so treasure notes were just as popular.

Including the Yongle Dynasty, the situation was similar. After all, the imperial court could collect taxes worth tens of millions of taels. Although the treasure notes issued depreciated quickly due to excessive issuance, they still had some basic value and would not be directly regarded as waste. Paper.

But if we want to reform the banknote law, stabilize the currency value of treasure banknotes, and make treasure banknotes a truly stable currency in circulation, then reserve funds will become very necessary.

"What does this reserve fund mean?" Zhu Gaochi naturally understood the key point of Zhu Zhanyu's words, but he did not understand what the reserve fund meant.

"The so-called reserve fund is the money that the court prepares after issuing currency to ensure that the currency can really be exchanged for cash. To be more precise, it is called the exchange reserve fund, or it can also be called the treasure banknote issuance reserve fund." Zhu Zhan Yun happened to learn some financial-related knowledge before he time traveled. Although he had thrown it away for a long time, he also picked up all this knowledge during the time he traveled back to the Ming Dynasty. Now he just happened to use it: "Issuance by the Imperial Court" The depreciation of treasure banknotes was severe. On the one hand, it was due to the excessive issuance of treasure banknotes by the imperial court itself, which naturally caused the depreciation of treasure banknotes. After all, the imperial court did not recycle treasure banknotes, and treasure banknotes could not be exchanged for silver. This Things naturally become waste paper.

If the imperial court did not still have a certain degree of credibility, no one would recognize the treasure banknotes at all. Therefore, issuing excessive treasure banknotes is actually overdrafting the court's credibility in the hearts of the people. This is what really digs into the Ming Dynasty.

Therefore, if you want to make treasure banknotes have a stable value and make people believe that they can be used as money again, you must ensure that they can be exchanged for silver.

It is for this reason that the silver in the new money bank cannot be used casually, because they have one and only one purpose, which is to exchange for newly issued treasure banknotes, so that the treasure banknotes can truly turn into money.

And one thing that needs to be noted is that the imperial court can print as many treasure banknotes as it has money, and it must not be issued indiscriminately. Otherwise, once the market is flooded with treasure banknotes, everyone will use the treasure banknotes to exchange for silver, resulting in the money in the new treasury being taken away. Sora, what will be the consequences..."

(End of this chapter)