Chapter 185: Currency War. (1)
"Your Majesty. It is said that merchants in our realm have been using large quantities of banknotes created by Joseon recently."
At the report of the Grand Secretary of the Cabinet, Emperor Xuande stroked his beard.
"Joseon's banknotes? Didn't envoys come recently regarding exchange and counterfeiting issues? So what trouble have our merchants caused?"
At Emperor Xuande's question, the Grand Secretary began to explain.
"Quite a few merchants are handing over silver to Joseon in order to obtain the 1-nyang silver banknotes created by Joseon."
"Why?"
"Because Joseon's court guarantees payment, they are trustworthy, and it is more convenient than carrying actual silver, they are exchanging for Joseon's banknotes."
"So, how much has flowed out?"
"We have not yet determined the exact amount, but it is reported to be a considerable quantity."
At the Grand Secretary's report, Emperor Xuande's face grew serious.
Ming's economy revolved around silver. The proportion of taxes collected in silver was steadily increasing, and transactions in the markets were also being paid with silver.
If such important silver was flowing out, this could become a serious problem.
With a grave face, Emperor Xuande, who had been pondering, commanded the Grand Secretary.
"Immediately ascertain the exact facts and report back."
"Yes, Your Majesty."
One month later, the Grand Secretary reported to Emperor Xuande.
"The silver exchange is taking place at the Joseon trade office located in Shandong, and last month alone, the exchanged amount was one million taels of silver."
"One million taels.... Is this serious?"
At Emperor Xuande's question, the Grand Secretary pondered for a moment.
'Looking at the size of our Ming nation now, one million taels is not a great burden. But, thinking of the future.... Should I just say it's serious? No, the benefits His Majesty has gained through Joseon, especially through Joseon's Crown Prince, are considerable, and if I misspeak, my head could roll.'
The Grand Secretary, pondering what the best answer would be, opened his mouth carefully.
"Right now, it is not a great burden. However, if the volume of transactions increases at the current rate, it will eventually become a major problem."
"Is that so? Then what should be done...."
At the Grand Secretary's words, Emperor Xuande frowned.
There were often times when this Grand Secretary worried in advance, but he was by no means incompetent.
Rather, through this Grand Secretary and the cabinet he commanded, Ming's finances were becoming solid.
'But if we pressure Joseon....'
Pressuring Joseon to recover silver through tribute or other methods was the easiest approach, but this would not be good for himself.
Joseon was a presence that enriched his own pocket—not Ming's national treasury, but the Emperor's personal finances. Arbitrarily pressuring Joseon would have a high probability of becoming the foolish act of killing the ox while trying to fix its horns.
While Emperor Xuande and the cabinet ministers were pondering like this, urgent news arrived from Shandong.
"Envoys have come from Joseon?"
Emperor Xuande, having read the contents of the report, looked back at the Grand Secretary.
"Is this the time for envoys to come?"
"No, it is not."
"What is this about? I'm curious what problem has arisen this time."
While Emperor Xuande was enduring his curiosity, the envoys sent by King Sejong arrived at the Forbidden City.
* * *
"So.... For what matter has Joseon sent envoys?"
After exchanging greetings adorned with all manner of flowery language and the return courtesies, Emperor Xuande went straight to the main topic.
At Emperor Xuande's question, the Vice Minister of Taxation who served as the chief envoy of the delegation immediately knelt and raised his voice.
"Your Majesty! Please, we beg you to save our Joseon, a small nation on the border!"
"Hm?"
At these sudden words, Emperor Xuande and the Grand Secretary could only blink.
After a moment, Emperor Xuande, having come to his senses, asked with a face full of doubt.
"As far as I know, neither I nor my Empire have harmed Joseon, so what is this strange talk?"
"Who does not know that Your Majesty looks upon our Joseon with special care? However, right now, too much silver from Ming is entering our Joseon! Our Joseon is originally a small country, so it is difficult to endure this. We ask Your Majesty to extend your imperial grace!"
At the Vice Minister of Taxation's appeal, Emperor Xuande looked at the Grand Secretary.
"It seems that silver is becoming a problem for Joseon as well."
"It appears so."
When the Grand Secretary nodded, Emperor Xuande looked back at the Vice Minister of Taxation and spoke.
"I too was aware that our Ming's silver is flowing into Joseon in large quantities and was seeking countermeasures. However, this is lawful trade by merchants, so I cannot arbitrarily intervene. Does Joseon have a plan regarding this?"
At the final question, the Grand Secretary looked at Emperor Xuande with slightly surprised eyes.
He realized that if Joseon had not brought an appropriate answer, the intention was to use this as a pretext to pressure Joseon.
However, Emperor Xuande was not thinking of this as pressure, but believed they had truly brought an answer.
'If it is the Joseon Crown Prince I know, he would not have stayed idle. Definitely.'
At Emperor Xuande's question, the Vice Minister of Taxation slightly deflected.
"How could a small nation interfere in the great nation's state affairs?"
"However, this is not only a problem for my Empire but also for your Joseon. Therefore, Joseon must have considered some answer. So speak. It is an imperial command."
At Emperor Xuande's command, the Vice Minister of Taxation hesitated for a moment before opening his mouth.
"We of Joseon believe that the best solution would be for the suzerain state to also create and circulate currency."
"Create currency? Hm...."
At the Vice Minister of Taxation's words, Emperor Xuande looked at the Grand Secretary.
The Grand Secretary also had an expression similar to Emperor Xuande's, looking troubled.
Knowing well that the Yuan Dynasty had created and circulated Jiaochao, Ming too had attempted to create and circulate paper money. However, the circulation of paper money was heading toward failure.
The biggest reason was that inflation due to Emperor Yongle's frequent campaigns and counterfeiting had caused the credibility of paper money to decline.
Ultimately, the Grand Secretary interposed on behalf of Emperor Xuande.
"Listen, envoy of Joseon. Our Ming too attempted to circulate paper money, but things did not go well. Yet you ask us to issue paper money again?"
At the Grand Secretary's words, the Vice Minister of Taxation replied.
"How could we of Joseon not know this? However, seeing that Ming's merchants seek our Joseon's banknotes, we believe there is definitely an answer."
At the Vice Minister of Taxation's words, Emperor Xuande and the Grand Secretary nodded simultaneously. Just looking at the merchants seeking Joseon's banknotes, the existence of paper money itself was clearly not the problem.
"Hm...."
Emperor Xuande, who had been quietly observing the envoy delegation, posed a question to the Vice Minister of Taxation.
"Did the Crown Prince of Joseon send you, envoy?"
"Pardon? No! We have come bearing the royal command from the King."
At the Vice Minister of Taxation's answer, Emperor Xuande chuckled.
"I have heard and know that Joseon's King is an outstanding person. But I have also heard that the current King of Joseon is closer to being a scholar. The answer the envoy just spoke is a merchant's answer. The only one in Joseon's palace who can think like a merchant is the Crown Prince. Am I wrong?"
"We received the royal command...."
As the Vice Minister of Taxation continued to deny it, Emperor Xuande smiled and reached a conclusion.
"Very well. Let us understand it that way. So, Joseon has told us to create paper money again. But to tell us to circulate paper money that already failed means they have a plan to solve that problem. What is it?"
At Emperor Xuande's question, the Vice Minister of Taxation answered immediately.
"It is trust."
"Trust?"
"It is the belief that if 1 tael of silver is printed on the paper money, it actually has the value of 1 tael of silver. It is the belief that there is no counterfeiting."
At the Vice Minister of Taxation's answer, Emperor Xuande murmured in a slightly disappointed voice.
"It is a correct statement, but...."
'This is correct principle that anyone knows. There is no way that Crown Prince does not know this.'
Emperor Xuande, who knew Hyang, was disappointed. However, the Vice Minister of Taxation answered calmly.
"To establish currency, there is no other clever stratagem besides protecting these two things for the best outcome."
"Why are you so confident?"
"It is because I too was involved in the issuance of banknotes."
At the Vice Minister of Taxation's answer, Emperor Xuande, who had been looking at the envoy delegation, looked at the Grand Secretary.
"Come to think of it... the fact that merchants seek it even though it's the same paper money means they trust it. But, I have never seen Joseon's paper money. Do you have any, Grand Secretary?"
At Emperor Xuande's question, the Grand Secretary immediately knelt.
Though he had heard rumors about Joseon's paper money and his curiosity was piqued, the Grand Secretary had deliberately not sought it out.
It was a matter of pride.
'How could paper money from a small nation!'
"I do not possess it either. Please forgive my disloyalty, Your Majesty."
When the Grand Secretary asked for forgiveness, Emperor Xuande lightly waved his hand.
"Disloyalty over something so trivial.... Rise."
"Your imperial grace is boundless!"
Meanwhile, the Vice Minister of Taxation, witnessing the scene unfolding before his eyes, gritted his teeth.
The Vice Minister of Taxation could speak Chinese to some extent, so he could understand what conversation had taken place.
'Something so trivial! Something so trivial! How much effort went into creating that and circulating it properly! If you've never seen it, couldn't you have just asked me? How much do you look down on our Joseon!'
The Vice Minister of Taxation suppressed his anger internally. It was because of Hyang's injunction before departure.
'Given our current circumstances, our Joseon is greatly lacking to deal with Ming. This time, and for a while to come, leave your liver and gallbladder in Joseon! The day will surely come when we can repay this!'
Recalling Hyang's injunction and suppressing his anger, the Vice Minister of Taxation interjected into the conversation.
"This humble official possesses it."
"Is that so? Let me see."
At Emperor Xuande's words, the Vice Minister of Taxation took out a wallet from his sleeve.
With careful movements, he took out a banknote printed with 1 tael of silver and handed it to the eunuch.
"It is Joseon's banknote."
"Is it?"
Though his tone was indifferent, Emperor Xuande received the banknote quite carefully. He too knew that Joseon's banknotes bore a royal seal.
"Truly beautiful! This is not a banknote but closer to a work of art!"
Emperor Xuande, seeing Joseon's banknote for the first time, unconsciously let out an exclamation of admiration.
Blue and red lines surrounded the outside of the banknote, and inside, a beautiful landscape painting was placed. On one corner of the banknote printed with '1 Tael of Silver,' King Sejong's royal seal was clearly stamped.
"The shape of the royal seal is somewhat different from what is stamped on state letters?"
At Emperor Xuande's question, the Vice Minister of Taxation answered immediately.
"It is a royal seal newly made with the intention of using it for currency."
"Is that so...."
Emperor Xuande, who had examined Joseon's banknote carefully, held it out to the Grand Secretary.
"Grand Secretary, take a look. At the very least, we need not worry about the counterfeiting problem."
While listening to Emperor Xuande's words and examining the banknote, the Grand Secretary looked at the Vice Minister of Taxation with surprised eyes.
"Is this truly printed?"
"It is indeed printed."
Hearing the Vice Minister of Taxation's answer, the Grand Secretary, who had been looking blankly at the banknote, unconsciously murmured.
"I heard that printing techniques in the lands east of the sea have been excellent since the former dynasty...."
Soon coming to his senses, the Grand Secretary presented the banknote to Emperor Xuande and spoke.
"Your Majesty's words are correct. It appears there is no need to worry about the counterfeiting problem."
"Right? Envoy, take it back."
Having returned the banknote through the eunuch, Emperor Xuande gazed into the distance and murmured.
"They say the fish that got away is bigger.... It truly is regrettable."
Emperor Xuande was clicking his tongue over his regret regarding Hyang.
"I understand the answer regarding the counterfeiting problem. Then what is the method for maintaining value?"
"The first step is to create and circulate currency only in amounts equal to the established budget and equivalent value. Through this, when the people come to have trust, gradually increase the circulation amount, but likewise, actual goods of the same amount must be held. And, if wishing to issue additional amounts beyond that, exchange only as much silver as those wanting exchange bring. When making such exchanges, the quality of silver must be thoroughly examined to accurately assess its value."
"That is the standard method."
At the Vice Minister of Taxation's concise explanation, Emperor Xuande nodded and looked at the Grand Secretary.
"I see why we failed."
"Indeed."
At Emperor Xuande's words, the Grand Secretary nodded.
To secure the budget for the campaigns and great maritime expeditions Emperor Yongle had undertaken, Ming's cabinet at the time had recklessly printed paper money.
And this had caused the decline in the value of paper money.
"Envoy, you may withdraw."
At Emperor Xuande's command, the envoy delegation paid their respects formally.
With three cheers of long live the Emperor, the Joseon envoy delegation withdrew, and Emperor Xuande looked at the Grand Secretary.
"If we prepare properly, we can do it too, can't we?"
"It is fully possible."
"Right? The humiliation of state-issued paper money being treated worse than promissory notes issued by a mere merchant guild must end now. And...."
Pausing briefly, Emperor Xuande revealed his true thoughts.
"If that small nation can succeed at something and we cannot, wouldn't that be absurd?"
"Indeed."
Thus, Ming too once again took on the challenge of issuing banknotes. And the period of tribulation for Ming's artisans began.