Chapter 110 Sir, what is the reserve system?

"Because of…"

Zhu Xi received the praise and subconsciously wanted to keep up his efforts.

But as soon as he started talking, he got stuck.

If it were a military issue, Zhu Ping might still be able to make some nonsense.

Faced with this novel knowledge, he could only smile awkwardly and said:

"Please sir, please explain to me."

"The reason why treasure banknotes are worthless lies with the current emperor, Emperor Hongwu!"

Lin Che didn't expect Zhu Ping to give any answer.

So, after the other party asked for advice, I gave him a lecture directly. However, the first sentence made Zhu Xi stunned.

Lin Che looked calm.

He also added slowly: "Of course, the prince and the ministers also contributed a lot to this!"

Good guy, he carried out all the most powerful people in the Ming Dynasty at once.

Even if Zhu Ping had experienced Lin Che's criticism of the current emperor, it would be the same shocking scene as Zhao Gou's.

But he still couldn't accept it when his husband was giving a lecture.

According to other people's opinions, this shocking statement might lead to the annihilation of nine tribes, just to deepen the students' impression.

"What's your expression like?"

Lin Che noticed Zhu Ping's complicated and almost distorted expression.

He solemnly emphasized: "From the perspective of monetary theory, the first reason why today's treasure banknotes are worthless is related to the decision made by the current emperor Hongwu and the courtiers to print treasure banknotes indiscriminately!"

Since Emperor Hongwu issued treasure banknotes, excessive issuance of treasure banknotes has become the norm over the years.

After all, he was born as a farmer, no matter how talented Emperor Hongwu was.

Regarding economic issues, we still have a narrow vision and do not take a long-term view.

In addition, in the early Ming Dynasty, money was everywhere.

Therefore, Emperor Hongwu wanted to save money.

Among the rewards given to ministers, treasure notes accounted for the vast majority.

And the amount is usually not small.

Anyway, in Emperor Hongwu's view, treasure banknotes were just randomly printed paper, and he could get as much as he wanted.

I don't care too much about the amount.

Fortunately, the banknotes were not issued for long.

No matter how excessive printing is, the total amount is actually not very large compared to the entire Ming Dynasty.

However, Emperor Hongwu, who had tasted the benefits, immediately waved his hand and started the Ming Dynasty banknote printing press to run wildly.

The treasure banknotes with the usual face value could soon buy something worth [-] yuan. It was already a case of being taken advantage of.

As the printing press continues to run crazily, now I can only buy two hundred cents worth of money.

Lin Che briefly described to Zhu Xi the reasons why the purchasing power of Ming Dynasty banknotes was gradually declining.

However, Zhu Ping was used to living a life of wealth and wealth.

Although I have some insights into the issue of declining purchasing power, I can only say that it is not deep enough.

Instead, he helped Emperor Hongwu shift the blame and said:

"Sir, since you said that Emperor Hongwu has just issued a treasure banknote, the treasure banknote can always be worth six hundred coins."

"But it has only been a few years now, and this treasure banknote can only be used as two hundred coins."

"In my opinion, at least [-]% of the value of the four hundred coins that disappeared in the middle is the responsibility of the Ministry of Revenue!"

Lin Che listened to Zhu Xi's argument that the butt determines the head.

I couldn't help but feel angry and funny, and gave this kid a headache.

"You kid, what I just said is to assess the responsibility for the depreciation of treasure banknotes?"

"This is obviously because there is no supporting reserve system in place."

“The trust level of treasure banknotes among ordinary people is constantly decreasing, so their purchasing power has also plummeted.”

"Sir, what is the reserve system?"

Zhu Xi was scolded by Lin Che and quickly lowered his head to ask for advice Che saw that Zhu Xiang was getting scared quickly and did not dwell on the previous topic.

"The so-called reserve fund means that when the imperial court issues treasure banknotes, it should prepare gold and silver to protect the value of the treasure banknotes and to exchange them for the treasure banknotes..."

Speaking of this, Lin Che suddenly couldn't speak anymore.

Throughout history, the Ming Dynasty's Baochao system, in any era, They are all unique and unique.

Even the gold standard began to recede into the background, and the future of credit currency was gradually implemented.

Countries will try their best to store more gold in the national treasury.

This will increase people's confidence in their own currency.

Avoid unplanned fluctuations in currency values ​​due to barely used reserves.

However, in today's Ming Dynasty.

Reserves for treasure banknotes?

nonexistent.

Emperor Hongwu waved his hand, and the court began to use treasure banknotes.

The common people actually recognized its value.

All I can say is that Lao Zhu is really good to the people.

Therefore, the common people used the treasure banknotes issued by him as money without any doubt.

Lin Che knew that just talking about theory would definitely make Zhu Ping confused.

He then mentioned the Song Dynasty, which had the most developed economy in the feudal era.

"Give me a simple example."

"During the Song Dynasty, merchants in Sichuan and Chongqing were very inconvenient in transactions because the iron coins they used were too heavy."

"Some merchants banded together and established a Jiaozipu, which was the original bank."

"I want the jiaozi issued in this way to replace iron money that is inconvenient to transport in transactions."

When Zhu Ping heard this, he suddenly couldn't help but interjected: "Sir, businessmen who set up banks do not have the support of the court."

"How can other businessmen recognize the Jiaozi they issued?"

When Lin Che heard this, she was not at all unhappy about having her lecture interrupted.

Instead, he smiled and praised Zhu Ping: "That's a good question!"

"You know, Jiaozi itself is a piece of paper. If you want everyone to recognize its value, you must save enough money in the bank!"

“That’s what I’m talking about as a reserve.”

This is exactly what happened.”

The reason why Jiaozi can be popularized in Sichuan and Chongqing.

The first thing to rely on was the reputation of those big businessmen for many years and the large amount of iron money piled up in Jiaozi's shop.

Also, their lucrative local industry.

This last point is especially important.

Anyway, when doing business in the feudal era, no matter how deceitful and deceitful you are in private, you still have to be honest on the surface.

Not to mention, everyone is from the same village.

If someone dares to use Jiaozi to deceive others.

The person who was deceived could organize a group of fellow villagers to dig up the ancestral graves of this unscrupulous guy’s family that day! Go to the liar's house again and get back the money that was defrauded!

As a result, the businessmen who manage Jiaozi Bank naturally don't dare to play any tricks.

In the early days, it was always the case that the bank would pay out as much iron money as it deposited.

Lin Che briefly told Zhu Chong the development history of Jiaozi in the Song Dynasty.

He also added his own conclusions.

"Because of the existence of reserves, the currency value of Jiaozi has been very stable initially."

"Until the boss of the bank, because of the massive wealth stored in the bank, his will to hold on to his ancestral graves was suppressed, and he began to secretly take the bank's deposits and play a trick of borrowing chickens to lay eggs!"

"As a result, the investment business naturally lost money. I wanted to make money back so I stopped. But it ended up losing money again, so I wanted to make money back again..."

"After repeating this process, the currency value of Jiaozi gradually decreased until it completely lost its value and stopped circulating..."

(End of this chapter)