Chapter 90 Zhu Biao's Worry
The reason why Zhu Yuanzhang could not fulfill the conditions proposed by Zhu Chong was actually very simple. The Ming Dynasty was poor and he, Zhu Yuanzhang, had no money!
He came up with the idea of treasure notes because he had no money. If he had money, why would he have racked his brains to issue treasure notes? Did he really not see the disadvantages of treasure notes?
Crown Prince Zhu Biao was the most sensitive. When he saw that Old Zhu's face was not right, he quickly brought up the subject, "Second brother, we are family, so we won't hide it. The method you proposed is not bad."
"But there's a huge problem. The imperial court simply can't do what you said, prepare enough gold, silver, and copper coins to ensure the treasure notes maintain their value!"
"Hahaha...Brother, you are overthinking it again." Zhu Chong certainly understood that the Ming Dynasty could not make a one-to-one reserve, and the following words were specially prepared for Old Zhu.
"The purpose of the imperial court issuing treasure notes is to allow all people in the world to accept the existence of treasure notes and make it convenient for everyone to use them."
"Behind this, no one actually cares whether the treasure notes represent the Ming dynasty or gold, silver, or copper coins."
"About 90% of the people in the world are common people. Their way of thinking is very simple. As long as they can exchange one tael of silver for one tael of silver at the government office, they will believe in the credibility of the court and believe that Your Majesty is right."
"In this way, no matter how many treasure notes the court issues, they can be circulated smoothly among the people without any problems."
"You've been talking for a long time, but you still need gold, silver and copper coins as reserves. But the problem is that we in the Ming Dynasty simply don't have that much money now. If we use it for reserves, your method still has loopholes!" Zhu Biao once again pointed out the crux of the problem.
Zhu Yuanzhang's face was gloomy and he remained silent. He agreed with the Crown Prince's opinion. If he had so much money, why would he need to issue treasure notes? Wouldn't it be better to just use gold, silver, and copper coins?
"Your Majesty, please forgive me, Prince, please forgive me. I didn't explain it clearly enough. Let's play a game again, and then Your Majesty and the Prince will understand what I meant."
As he spoke, Zhu Chong first picked up all the treasure notes that had fallen on the ground, and then gestured to Old Zhu.
"Your Majesty, for now, let's assume that the common people can exchange the notes in their hands for gold and silver at their face value, and then His Royal Highness the Crown Prince will still be a farmer and a worker."
"His Royal Highness the Crown Prince needs to buy daily necessities now. He sold the pigs he raised at home and obtained three strings of coins worth of treasure notes."
Zhu Chong placed three strings of cash in Zhu Biao's hand and said, "Your Highness, if you have money, go buy five hundred coins worth of grain. Your Highness, please give me five hundred coins."
Zhu Biao handed the five hundred wen notes to Zhu Chong with a puzzled look on his face. Zhu Chong then said, "Your Majesty, please look. The Crown Prince has already purchased the items he needed. Now, for example, the Crown Prince no longer needs to buy anything. What about the remaining money?"
"Of course I will save the remaining money myself, and use it directly next time I need it!" Zhu Biao didn't understand what Zhu Chong was planning, so he spoke first.
This time, Zhu Chong smiled without saying a word, just looking at Zhu Yuanzhang. Old Zhu was stunned at first, but after thinking carefully for a moment, his eyes suddenly lit up, and he looked at Zhu Chong with disbelief in his eyes.
He understood the meaning behind the game Zhu Chong had just played. The huge rock that had been weighing on his heart was finally removed, which made him suddenly see the light.
Zhu Biao, who was in the middle of the situation, still couldn't understand what Zhu Chong meant. "What a mess you are making! If you continue to do this, won't the people remain the same as before?"
"No, it's different." Old Zhu finally spoke, pointing his finger at Zhu Chong, "You're not bad, very good. I really have been underestimating you!"
"Huh?" Zhu Biao was bewildered. How could it be cloudy and rainy just now, and now it's sunny again? He and Old Zhu had clearly heard the same thing, so why did Old Zhu understand while he didn't?
"Hahaha..." Seeing that the prince didn't understand, Old Zhu was even happier. He immediately forgot about the unpleasantness between him and Zhu Chong and even changed his address to him, "Second brother, why don't you explain it clearly to your eldest brother?"
"As you command." Zhu Chong bowed to Zhu Yuanzhang first, then looked at Zhu Biao. "Your Highness, I mentioned earlier that as long as the treasure notes can be exchanged for gold, silver, and copper coins of equal value, the people will always have faith in the court and the treasure notes."
"The imperial court issued treasure notes, making them equivalent to gold, silver, and copper coins. Once the people got used to the existence of treasure notes, they became common currency, and the imperial court was able to profit from it."
"As long as the imperial court can ensure that the treasure notes do not depreciate, the wealthy people in the private sector will exchange all their accumulated wealth for treasure notes for convenient storage. Then the imperial court will gain a huge amount of wealth..."
"Wait, wait a minute." Zhu Biao nodded repeatedly at first, but interrupted Zhu Chong directly after hearing the end.
"Even if, as you say, the imperial court got real money from those people, they wouldn't dare spend it recklessly. That's all reserved to prevent the devaluation of the treasure notes. If someone can't exchange the treasure notes for gold, silver, or copper coins, wouldn't that be the end of it?"
When Old Zhu heard Zhu Biao's question, his expression froze. He had not thought of this just now, and now that the prince reminded him, he suddenly felt that something was wrong.
"Your Highness, you're worrying too much." Zhu Chong smiled and said, "As I mentioned earlier, since the treasure notes are issued by the imperial court, they are money, gold, silver, and copper coins. As long as the craftsmanship and details are guaranteed, once the people get used to using the treasure notes, they won't want to exchange them for anything else."
"It's better to be safe than sorry. What if someone insists on exchanging it for gold, silver or copper coins?" Zhu Biao continued to ask.
"Then give it to him, but I can guarantee that this situation is rare. The reserves prepared by the court are to deal with this kind of people, not to deal with everyone!" Zhu Chong explained patiently.
"But what if the court doesn't have that much money for reserves? Forget it, let me tell you, Second Brother, how much reserve do you think the court needs to prepare based on how much treasure notes it issues?"
"So that's what His Royal Highness is worried about." Zhu Chong said with a confident smile, "About 10 million strings of banknotes. If the court prepares 5 million taels of silver, that will be more than enough."
"What?" Old Zhu and Zhu Biao said almost in unison. They never expected that Zhu Chong would say such a number.
"This is too outrageous. Five million taels is enough?" Zhu Biao looked incredulous.
According to his estimation, ten million strings of treasure notes would require at least eight million taels of silver as a reserve fund to be safe, but he didn't expect that the number given by Zhu Chong was half of that.
"Your Highness, I have mentioned this before. What you are worried about is that someone will exchange the money, but the actual situation is not like that. Five million taels is actually a lot." Zhu Chong explained patiently.
"But if someone does that, what will you do?" Zhu Biao was a cautious person and went straight to the bottom of the matter.
Old Zhu was also very curious, but he was more concerned about what Zhu Chong had just said, that for ten million strings of treasure notes, only five million taels of silver would be needed as a reserve fund.
Does that mean that even five million taels isn't necessary? If that's the case, that would be fantastic!
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