Chapter 1225 Crucified on the Golden Cross (Third update, please subscribe)
Author: Xiaoyu’s Destiny
Chapter 1225 Crucified on the Golden Cross (Third update, please subscribe)
Hu Xueyan's suggestion is correct. Since the discovery of large amounts of gold in California and Australia, the world's gold stock has suddenly increased. The sufficient supply has made it possible for gold to be used as a single standard currency to meet the needs of economic development in European countries.
And what is the corresponding one?
After entering the 1870s, huge silver deposits were discovered in many places in the United States, and the amount of silver mined in the world surged. The discovery of silver mines not only increased the supply of silver, but also increased the risk of devaluation. Therefore, out of financial security, European countries began to
Gold and silver returned to the standard and turned to the gold standard. By 1880, all major industrial countries had adopted the gold standard.
Because of this, the empire has also considered this aspect. After all, in the long run, the depreciation of silver is almost inevitable.
But... Ming Dynasty has its own national conditions!
Emperor Zhu Da smiled coldly and asked.
"Why, according to the Hu Qing family, we are going to crucify the Ming Empire on the golden cross just like them?"
Crucified on the cross of gold!
This is what American politicians say. After the United States abolished the "gold-silver dual gold system" and switched to the gold standard, the struggle over the currency status of silver and gold became extremely fierce and directly became an issue in presidential elections in previous years. Currency issues directly became political issues!
William Jennings Bryan, a civilian presidential candidate who supported the restoration of silver as a mint, said in his speech: "You cannot put a crown on the heads of laborers; you cannot crucify mankind on a cross of gold." This is for the world.
The famous “Cross of Gold” speech!…
"Your Majesty, in the long run, the depreciation of silver is inevitable!"
Hu Xueyan said directly.
"For the long-term development of the empire's finance and economy, implementing the "gold standard" is the only option to ensure currency security! After all, gold retains its value better!"
Why did the whole world finally change to the "gold standard"? In essence, gold maintains its value better and gold is more stable.
"It is true that gold is more stable and retains its value better!"
Emperor Zhu Da agreed and said again.
"Hu Qing's family, but don't forget, the biggest difference between the empire and other countries is that we are the largest silver-producing country in the world!"
This is the reason why the Imperial Household Ministry has been arguing. In fact, before the annexation of Peru and Bolivia, the Ming Dynasty's copper company in Shanxi extracted a large amount of silver with advanced production technology. As early as the 1870s, the Ming Dynasty's annual silver output
It has exceeded 300 tons, and with the occupation of Peru and Bolivia, especially the Potosi silver mine in Bolivia, the Potosi Silver Capital, was once the most famous silver mine in the world. At its peak, its silver output accounted for 10% of the world's total.
Half of the world's silver production. After it was annexed by the imperial mining company, Ming's annual silver production has exceeded 1,300 tons.
It can be said that the Ming Dynasty, like Mexico, is the largest silver-producing country in the world. To implement the gold standard under such circumstances is simply making a joke of its own industry.
"If we abolish the silver standard, then silver will become a commodity, which will not only hit the silver industry, but also severely damage the economic development of the empire, because..."
Staring at Hu Xueyan, Emperor Zhu Da said directly.
"Our gold production is limited! Don't forget that Britain and the United States are both the world's largest gold suppliers, and our gold production in Alaska and the Northern Territory is only 50 tons. 50 tons of gold can support the empire's monetary system.
?"
In fact, what is the biggest difference between people's economic policies in this era? That is, Emperor Zhu Da from the 21st century stood on the shoulders of historical giants. He knew that the "gold standard" had led to many economic crises in history.
, an economic crisis caused serious internal consumption of capital in various countries.
It is precisely because of this that he is so sensitive to the "gold standard".
"If you study the European and American economies, you can see that after the British economic crisis in 1825, an economic crisis broke out in the United Kingdom basically every ten years! In 1837, 1847, and then in 1857, crises broke out in the United States, which evolved into a universal and worldwide crisis.
, 1873 to 1879 was the most far-reaching economic crisis in the 19th century, with a time span of eight years. When will the next crisis break out? I thought it would probably be around 1892!"
Why did Emperor Zhu Da make such a judgment? Because a crisis every ten years is a classic textbook content of the shortcomings of capitalist economy!
Moreover, he clearly remembered the economic crisis of 1893, and even this was another goal and plan of his, not only for him, but also for the entire empire.
Soon, the meeting with Hu Xueyan turned into an imperial financial meeting attended by Qian Degong, Cheng Dingkang, Fang Zhanbo, Lin Hongju, Minister of Revenue, and Xu Weizu of the Imperial Central Bank.
This financial conference will ultimately determine the empire's future monetary policy. Of course, more importantly, how the empire will win this "currency war"
"...Why do economic crises break out periodically every 10 years or so? On the surface, it seems to be due to insufficient consumption, but the so-called "underconsumption" actually means no money. Why is there no money?"
Emperor Zhu took out two coins, one was a gold coin and the other was a silver coin, and asked.
"Essentially, there is still a shortage of currency. Governor Xu, what is our currency issuance?"
"Back to Your Majesty, as of now, the currency in circulation in the empire is mainly silver dollars, of which the market circulation coins are about 1.175 billion yuan. In addition, the central bank reserves 1,317.37 tons of gold and 11,553 tons of silver. Based on this, the central bank issued 79.85
Billions of banknotes.”
Xu Weizu, the governor of the Imperial Central Bank, specifically added after answering His Majesty's question.
"In order to stimulate the economic development of the empire and ensure that there is enough circulating currency in the market, the empire's money supply needs to increase by about 2% every year."
Appropriate additional currency issuance is conducive to national economic development. This is a classic theory of Keynesian elastic money supply policy. In the past ten years, Ming Dynasty's economic take-off has proved this.
Emperor Zhu Da nodded and asked.
"So, what is the basis for us to issue additional currency?"
"The empire's ever-increasing gold reserves, the current trade surplus of the empire is 195 million yuan, because the supply of gold coins in the empire is limited, and the market is dominated by silver coins and silver dollar certificates, so after the enterprise trade settlement, the enterprise needs to exchange silver coins. Of course, the empire
The stable supply of silver from silver mines is also the fundamental reason."
Nodding slightly, Emperor Zhu Da said.
"In other words, all currency issuance is based on precious metals?"
Actually, this is something we all know, but in the 19th century, many people believed that without precious metal coins as a reserve and as a strong backing, currency would be worthless. Because, the holder of the banknotes must be able to exchange the banknotes for gold at a bank or treasury.
Silver is a precious metal. Therefore, when countries around the world issue banknotes, they do not issue them recklessly. They reserve a large amount of gold and silver for payment and redemption.
"Your Majesty, if we don't have enough gold and silver in our treasury, the Great Ming Yuan will become useless paper tomorrow!"
Although Qian Degong is not a financial expert, he has read history books.
"The treasure banknotes of the Yuan and Ming dynasties serve as a warning to others."
With a slight nod, Emperor Zhu collected the silver coins in his hand, leaving only one gold coin.
"What would happen if we were on the gold standard?"
Holding the gold coin in his hand, Emperor Zhu looked at everyone and asked.
"With the current scale of the empire's economy and its population of hundreds of millions, if we change to the gold standard, will the empire's current gold reserves be able to support the value of the currency? Can the money supply meet market demand?"
After asking questions one after another, Emperor Zhu Da said.
"The gold standard seems to have stabilized the value of the currency, but in fact, if the "money supply cannot meet the demand of the market," what is waiting for us? The empire and its economy will be--crucified on the cross of gold!"