Rise of the 1630s South America

Chapter 1995 Currency Reform

While waiting for the news from the Don River and the Volga River Basin, Gao Wengang called a meeting with representatives of local business stations, county governments, and state-owned banks to discuss matters related to the currency reform of the Ottoman Empire.

Currency reform, in fact, is not an unfamiliar term in later generations. Many countries have experienced it. It is as far away as Britain’s abandonment of the gold standard in the first half of the 19th century, and as recent as Zimbabwe’s currency reform, which reduced ten zeros in currency. The major event will not be carried out unless it is absolutely necessary.

The Ottoman Empire wanted to reform the currency system this time, but it was out of helplessness that they had to change it!Any businessman who has done trade in the major cities of the Ottoman Empire will have a personal experience, that is, the currency issue is too deceitful!For example, you transported a ship of iron products from England to the port of Smyrna in the Ottoman Empire. After selling it, you got a lot of currency. Most likely it was a Venetian-style Ducat cast by the Ottoman Empire, commonly known as "Golden Geng".Here we do not discuss the troubles caused by the fineness of the currency and its authenticity, but simply talk about the currency itself. Assuming that you have received a sufficient amount of silver coins that are not damaged and of good quality, then you go to the famous port of Saloni in Greece card for trade.

sorry!When you arrive in Thessaloniki, this currency may not be used anymore, because the currency of the Italian city-states (mainly Venice and Genoa) is used here, and it is the currency minted by serious people!At this time, you must find a reputable money changer, and then exchange the currency on hand into several major Italian-style currencies in circulation in the local area before you can trade.

This is still in Thessaloniki. In fact, when you go to other cities in the Ottoman Empire, you will find that there are various other local currencies, all of which bother you and bring great inconvenience to commercial trade.In other words, this chaotic currency system is actually anti-free trade. It has been criticized by businessmen from all over the world, but it has never been resolved, because the interests involved are too great.

Now let's talk about the problems caused by the fineness of currency.In fact, throughout the 17th century, the Ottoman Empire's finances have not been so well-off, which is related to their huge expenses (including war expenses), as well as their poor taxation efficiency.But no matter what the reason is, it directly led to the financial constraints of the Ottoman Empire, and there was often no money in the treasury, so that the government continued to mint low-quality currency to plunder private wealth.

This was especially evident during several wars.The silver and copper coins minted by the Ottoman Empire government were so poor in quality that they were disgusted by domestic merchants and began to use foreign currencies for transactions spontaneously, which intensified the country's currency system. The chaos has plunged the country's economy into a deeper crisis.

The people on the east coast have traded in the Ottoman Empire for many years. Because of the large trade surplus, they once accumulated a large amount of currencies from various countries—obtained from the Ottoman Empire government and merchants—even though they took countless samples and tested the quality, they still ate a lot. So bad that later he simply melted those rotten currencies and made them into silver bricks to bring back to the country.

Compared with these rotten currencies, the various east bank gold and silver coins that flowed into the Ottoman Empire through the hands of the east bank merchants are very popular among all walks of life. Because of their exquisite workmanship, full color and stable shape, they are widely used. The merchants of the Ottoman Empire collected them and circulated them in some areas on a small scale (large-scale circulation is impossible, because bad coins drive out good ones), allowing the east bank government to make a small fortune in seigniorage.

And seeing the popularity of the East Coast currency in some towns around the Black Sea, Gao Wen, the East Coast Plenipotentiary Envoy to Europe, just tried to persuade the high-level of the Ottoman Empire to accept the currency reform with the help of the East Coast people. It is better to mint a brand new currency or simply use the East Coast currency directly. The East Coast government guarantees that there will be no credit problems.

After hesitating for a long time, the top leaders of the Ottoman Empire finally chose the former and asked the people on the east bank to help them design a new set of silver coins, the Turkish dinar, which was exchanged with the east bank dollar one-to-one.The prerequisite is that the East Coast Republic of China borrows 500 million yuan from the Ottoman Empire government, and the delivery method is that the East Coast government directly transports the minted 500 million dinars to Istanbul, so that they can pay the salaries and troops of the imperial officials who have been in arrears for a long time salary.Of course, they still owe a large amount of money to businessmen from various countries, but this is not a priority item that needs to be paid—it can even be denied if necessary, at least part of it can be moved back, and the salaries of civil servants and military salaries will not be paid. If not, I'm afraid there will be a big problem!

This is the result of Gao Wengang's consultation with the Ottomans for a whole year.In the usual way, this achievement may not be easy to obtain, but under the pressure of years of war, the Ottoman Empire, whose finances have long been on the verge of collapse, finally had to agree to the request of the people on the east bank and obtain it by transferring the right to mint coins. The loan provided by Dongan people has a preferential loan with an annual interest rate of 5%.

However, the Ottomans also put forward conditions. The Mint, which is responsible for minting currency for them, must be under the supervision of the Ottoman Empire, preferably on the territory of the Ottoman Empire.Gao Wengang did not agree to this condition at the beginning, but the Ottomans were firm. After many rounds of back and forth between the two sides, they finally decided to set up the Mint in Port Haji, a leased land on the east coast that is very close to the Ottoman Empire. Inquire about account transactions-of course, these expatriate officials are also responsible for purchasing dinar silver coins from this mint and transporting them back to Istanbul, buying one dinar at a consideration of [-] grams of silver.

This condition is the most acceptable to both parties.The Ottoman Empire received much-needed funds for emergency relief, and a brand-new, sound currency could restore its crumbling credit, quickly restore the country's already extremely sluggish industry and commerce, so that the government could collect enough taxes.

There is no doubt that the unified domestic currency and market will greatly promote the economy!In this era, the countries that took the lead in doing this, such as the United Provinces and England, had the most developed industry and commerce in continental Europe. A unified currency and a unified market can greatly stimulate the potential of the economy, allowing money to flow quickly, thereby increasing the government's Taxation, to achieve a virtuous circle.

To be honest, the Ottomans don't quite understand these principles, or those on stage don't understand, and those who understand can't get on stage. In short, under the persuasion of the people on the east coast, they passively accepted the reform proposal and planned to use a brand new currency for the first time. Gnar swept across the national market, expelled those Italian businessmen and Dutch who were eating seigniorage, removed various obstacles to domestic trade, and prepared for the eventual establishment of a unified national market.Although the minting rights may be lost in this process, there are many countries that do not have the minting rights in this era. The Ottoman market is flooded with currencies from various countries. On the contrary, the Ducats minted by the government of the country (in fact, they are also minted in imitation of the Venetian currency) because The quality is poor and not very popular with people, so it's just drizzle if you don't have the right to mint coins, it's a trivial matter.

What's more, who stipulated that every dinar in the Ottoman Empire must be purchased from the Haji Mint?Hehe, you are so naive!After the limelight passes, they can secretly mint a small amount of dinars and put them in the market for circulation.Of course, they will control the quantity and fineness (the silver content only needs to be a little lower than that of the people on the east coast), so as not to be exposed in the market soon. In short, there are still many ways.Moreover, when the economic situation really improves, you can negotiate with the people on the east coast to get back the minting rights again. I believe that the people on the east coast have already made a lot of money at that time, so they shouldn't mind too much, right?

From this, it can be seen that the Ottomans have done their best in their calculations, and now they urgently need the dinars cast by the people from the east coast to save their lives. Let’s wait and see again in the future when we have a change of breath!Of course, the people on the east coast are not fools, otherwise the previous two plenipotentiary envoys, including Gao Wengang, would not have all wanted to gain the power of currency reform in the Ottoman Empire.In fact, the Ottoman Empire is so large, with a population of more than [-] million people, there is a huge demand for currency, especially after expelling all kinds of foreign gold and silver coins and unifying the national commercial market. The demand for the quantity in the first few years is very astonishing. People on the east coast only need to do a little trick on the silver content of the dinar, and the income will come rolling in, which cannot be stopped.

Basically, everyone is now in a state of mutual utilization, which can be said to be a win-win situation. This even includes the loan promised by the people on the east coast: most of the 500 million dinar loan is guaranteed by the East Coast government. Borrowing there, the annual interest rate can be controlled at about 3%-4%, and then lent to the Ottomans at an interest rate of 5%, and you can make a small profit yourself, what a good deal!

This time, Gao Wengang called a meeting with the relevant personnel of the state-owned banks and commercial stations in Haji County, and the discussion was actually about this matter.The government of Haji County is very excited that their county will mint silver dinar coins for the Ottoman Empire, because it means a huge tax revenue.The bank staff are also in a good mood, because they have made another loan business, and the amount is huge.They're justifiably proud, because the Italians are holding a lot of money and dare not lend it to the Ottoman government, so it's cheaper for the East Coasters who have transferred it, although they must have to give these Italian bankers elsewhere. benefits as compensation.

After the meeting with these people, a refreshed Gao Wengang returned to the office and wrote a report to the mainland.The content of the report is mainly the latest results of the negotiation with the Ottoman Empire on currency reform. At the same time, it applied to purchase a complete set of minting equipment from the local area, including testing, smelting equipment and steam stamping equipment. These are controlled export commodities and cannot be issued without a certificate.

Time passed quickly like this. On September 9, a returning Ottoman galley docked at the port of Kaffa. After disembarking, two cavalry officers from the east bank went ashore and headed straight for Haji port. They brought Gao the latest news about the Don River Basin. News: At the beginning of this month (September), the 30 fine cavalry led by Lieutenant Colonel Mao Jun occupied a small town abandoned by the Russian army without a fight, and then they met outside the town. ) The Oirat Mongolian herdsmen who watched (robbed).Upon inquiry by an interpreter, they were nomadic Dulbert Mongols on the right bank of the Volga River. Ayuqi of the Torghut Department is the Great Khan.

Mr. Mao asked the herdsman to take them to the location of Ayuqi Khan's golden tent.These herdsmen resolutely refused at first, because they saw that Mr. Mao's [-] fully armed cavalry did not look like good people. Everyone's backpacks were bulging, and they obviously robbed many Russian villages and towns along the way, so they had deep doubts. .

Upon seeing this, Mr. Mao immediately ordered his subordinates to release all their belongings, and bribed the herdsmen of the Duerbert tribe generously, asking for their recommendation.The herdsmen were moved by the gold in front of them, and finally agreed to take them to the nomadic land of their own tribe. As for whether their nobles allowed them to go to Ayuqi Khan's golden tent, that was beyond their control.

The news from the messenger was relayed here, because the two of them did not go to Duerbert's department, but returned to deliver the news, which made Gao Wengang feel a little regretful, just like a book that he was chasing ended abruptly here, without an end Disappointing.

"Wait slowly, this is a good start. Duerbert's department has [-] accounts, if it doesn't work, just kidnap them first." Gao Wengang thought.

(End of this chapter)