Reissue Zhang Jie's article 15 years ago: Financial and Monetary Aggression after the Sino-Japanese War

Just been turned out by netizens ten years ago about the financial game after the Sino-Japanese Sino-Japanese War video, this problem I also wrote a related article earlier, and now the article of the year is once again published here, to show you more details and arguments. This helps everyone understand the real game of the world and understand the severity of financial warfare. This article was first published in Tianya, the ID is: who is not a comment, but after Tianya blacked me out, everyone can't see this article.

Financial and monetary aggression after the Sino-Japanese War

After China's defeat, we generally think that Japan made a windfall, but what we did not expect was that what we really made behind the scenes was international financial capital and the world powers, who sought benefits beyond our imagination through financial and monetary means of aggression.

China and Japan signed the treaty of Maguan, which humiliated the country, and the Qing Dynasty paid 200 million taels to Japan and the island of Taiwan, and these huge reparations were repaid by borrowing from the banking groups of Britain, Germany, France, Russia and other countries, and the final total principal and interest was as high as 600 million taels. In July 1895, the Chinese government signed the "Four Percent Loan Contract", that is, the "Russian-French Loan", in order to repay the reparations within three years in accordance with the treaty, the Chinese government and Russia and France signed the "Four Percent Loan Contract", all of which borrowed 400 million francs, with an annual interest rate of four percent, and repaid it in 36 years, with a discount of 94.125%. In March 1896, the Chinese government signed a loan contract with Britain and Germany, that is, "Anglo-German borrowing", with a total loan of 16 million pounds, an annual interest rate of 5%, repaid in 36 years, and discounted on 94. In March 1898, the Chinese government once again signed a loan contract with Britain and Germany, that is, "continuation of The Anglo-German loan", with a total loan of 16 million pounds, 83 discounts, an annual interest rate of 45%, and repaid in 45 years. It has been calculated that the estimated indirect losses caused to China by the above three loans alone amounted to 404.71 million taels, and these loans also included harsh additional conditions for further loss of China's sovereignty, as follows:

1． Within 45 years of the repayment period, the Chinese government shall not accelerate repayment or pay it off once in advance, nor shall it change the repayment method;

2． "When the loan is not repaid, the Customs Affairs of the Chinese Prime Minister shall be handled in accordance with the advanced handling method" (that is, the position of the Customs and Taxation Department has always been filled by the British);

3． The scope of the loan guarantee, in addition to customs duties, is also the goods and salt, and Hurd took the opportunity to ask the neutral government to hand over the relevant bureaus to the jurisdiction of the General Taxation Department, which greatly expanded the powers of the General Tax Department.

These conditions guaranteed that the collection of interest strengthened the control of China's income, that nearly twice the interest and collateral benefits of the reparations were obtained by international financial capital, and the profits of international financial capital exceeded Japan's war wealth, and Japan's war gains were more than the repayment of foreign debt to international capital and the purchase of arms from the great powers again, and most of the benefits still flowed into the pockets of the great powers and predators.

The greater interest was the ensuing financial and monetary war, which threatened China's silver to depreciate, and the great powers conspired with Japan to force China to pay 230 million taels of reparations from China in April 1895, forcing China to deliver in pounds sterling, so that China had to sell silver in exchange for pounds, and the two countries that used silver had to use pounds to pay, so the great powers could be seen. When the tariff rules of the Agreement between China and the Great Powers were formulated in early 1843 and revised in 1858, the special silver two used to calculate the tax rate and pay the customs duties on the basis of which the customs two, in fact, maintained a definite value of eight pence per two or six shillings or three or two pounds for the pound sterling, which was actually a fixed exchange rate system between Chinese silver (Treasury silver) and the pound sterling, and it should be known that the repayment and guarantee of China's foreign debt are customs duties. Under the run on Japanese war reparations, this fixed exchange rate system was broken. According to a memorandum submitted to countries in 1896 by the General Customs and Excise Department, "the exchange price of silver against the pound sterling has been constantly depreciated, so that at present it is necessary to buy six to seven pounds." "This document allows us to see that China's silver has depreciated to half its original value, and the great powers have paid half of their taxes by customs, which is the actual bankruptcy of China's fixed exchange rate system with the customs two as the core. From three or two silver to one pound to six or seven silver for one pound, such a depreciation is the depreciation of precious metal currencies with resource nature for paper money that relies on bonds, which is the opposite of the depreciation of today's dollar, which is the intensification of our silver outflow and resource outflow, and our silver outflow has caused greater currency deflation, and China's economic development has been completely stifled.

Such a huge depreciation will inevitably cause Greater losses to China, and the immediate loss is that there will be huge exchange losses in the return of our loans to the great powers and financial capital after the Maguan Treaty, which is known as pound losses in history, and the international financial capital's manipulation of gold and silver, as well as the exchange of sterling paper money for China's real silver, have extremely huge benefits. Leaving aside these indirect financial benefits, the tax revenue of the customs after the devaluation and our trade losses were enormous, and the total tax revenue of the Chinese customs under Hurd continued to increase, from 8.3 million taels in 1865 to 12 million taels in 1875, and to 14.5 million taels in 1885. In 1887, the import of foreign goods exceeded 100 million customs two. By 1894, it had risen rapidly to 162 million customs in seven years. All these losses add up to a loss of not 230 million taels of silver, nor 600 million taels of silver with interest, but a loss of more than a billion to billion taels of silver. The great powers and international financial capital are full of money, so when we look at China's modern history, don't always pay close attention to the reparations of China's various wars, all the reparations add up to no more corrupt officials and gentry's family property, China's loss lies in the loss of finance and resources, at that time silver is a resource!

China's resource loss is the key to China's gradual decline into a poor country with difficulties in survival, the most important means of such outflow is not military, but trade, finance, currency, economic means for China's historical plunder is more than military means, we can not always focus on military and war and ignore finance and currency. And here the advanced economic theory of the Western powers is better than the advanced of the Western military weapons, we did not have any economic theory at that time, and the Western teachers in Chinese history were more about learning their production technology, military weapons, etc. than economic theory, our traditional Confucianism can not resist the Western economic and financial theory, for the impact of these economic theories We also have no deep understanding, China's earliest students were basically studying technology rather than economics. The profound understanding of resources and the mercantilism of resources in Western economic theory have brought them tremendous economic benefits, and china has not yet profoundly understood such differences in interests and economic aggression in history, and there are no chinese historians who understand finance, otherwise those orthodox scholars who especially love to discuss China's failure as a joint strangulation of Chinese and foreign reactionaries will definitely write this point into history textbooks.

The depreciation of China's silver forced a surge in Chinese trade, mainly on imports of necessities, resulting in a serious overstepping of China. According to statistics, in the ten years before the war, China's average annual import and export volume was only more than 226 million customs two, of which the import value was only more than 126 million customs two, and the export value was only more than 99.6 million customs two. According to statistics from 1898 to 1913 after the Sino-Japanese War, China's average annual total import and export volume increased to more than 600 million customs two, and the export value was more than 251 million customs two. For the needs of China's self-sufficient agricultural society, to buy abroad is basically rigid demand, we import foreign goods, opium and other just demand, imports with the exchange rate changes will not be very large, more than 200 million customs two import trade volume growth, basically all is the effect of silver depreciation, China to meet their own rigid demand every year for no reason more than 200 million more than two hundred million silver, and foreign procurement of our products, the same money can buy more than double things, More than 200 million exports can buy you more than 200 million materials and resources, a total of more than 400 million two, that is, every year two Maguan Treaty reparations come out, or every year a Xin ugly treaty reparations come out, which is equivalent to each Chinese 1 or 2 silver per year, for China's per capita income of about 3 or 2 societies at that time, equivalent to the tax rate reached 33%, and the Original 5% of the Qing Dynasty government added up to nearly 40%, here and the government tax is different from the government tax is that these losses are rotten meat outside the pot, Even if the government's taxes are corrupted, they are consumed in the domestic society, it is the meat rotting in the pot and being Chinese the income will be converted into new wealth, and the outflow of resources is the transfer of wealth to other countries, and the annual loss will soon deplete China's historical wealth, such a loss is much more terrible than the war, and China will be fought down from the throne of the world's first rich country, from here we can see that the Western powers and financial capital support Japan's war against China, and launch a financial war with the help of military war. The extent to which they plundered profits from China in the financial and monetary war, how the wealth accumulated by China in the past thousand years of leading the world flowed out to the West, and how it was plundered by the great powers can be imagined, to know that the total amount of all the war reparations in China can not catch up with the 900 million taels of silver obtained by the gentry in that year, with the accumulation of China's historical wealth, the war reparations alone cannot lose China's economic foundation, and the plundering of financial and monetary resources is the key to the problem. Therefore, Japan's Sino-Japanese War against China was a military, financial, and monetary war in which Japan used military strength as a means, and the great powers and international financial capital conducted a financial and monetary war as the essence; what China lost to was not only a small emerging country, but a powerful global force behind it.

Many foreigners here brainwash Chinese to cover up their financial and monetary resource plunder, saying that China's silver depreciation is caused by the discovery of a large number of silver mines in the Americas, and the surge in silver mining, so it is normal for silver to depreciate, and also come up with historical data to say how much and how much Mexican Eagle Ocean is in circulation in China. But we must also see the essence of the problem: China's large influx of silver was many years before the Opium War, because of the inflow of foreign silver, China's prices are indeed much higher than the Ming Dynasty prices, the silver of the Qing Dynasty is not as valuable as the Ming Dynasty, but before the opium war began, China was the outflow of silver, so there was a ban on smoking and opium wars, after the Opium War, China's silver outflow was accelerated, until after the Tongguang ZTE, it did not change, but it was also incomparable with the original outflow. Therefore, China's silver was generally a net outflow at the end of the Qing Dynasty, so how can such a silver outflow produce too much silver and depreciate? Mexico's Eagle Ocean is only the inflow of the Americas to China, and does not calculate the outflow of China to Europe and the United States! There is also a situation that everyone knows to consider, that is, not only a large amount of silver was found in the Americas, but also a large amount of gold was found in the Americas! For example, San Francisco, Los Angeles and other places, and the pound's gold standard system is linked to gold, so the gold found should also depreciate after the gold is found to flow into the market! Let's look at such a problem from the actual purchasing power to make it clearer, China's silver outflow in China is deflationary, the specific performance is the serious imbalance in the exchange price of silver and copper coins, we have depreciated from 1,000 copper coins to one or two silver depreciation to more than 2,000 texts, the highest even reached more than 3,000 copper coins to exchange one or two silver, silver in the domestic purchasing power is a sharp increase, silver is external depreciation to internal appreciation, comprehensive calculation has more than four times the gap. The internal appreciation of silver is the most plausible way to say that such a devaluation was caused by the influx of large quantities of silver found in the Americas into China. If we take into account the changes in the actual purchasing power of silver, the actual utility of the more than 400 million taels of silver that the West plunders from China every year through financial and monetary wars mentioned earlier in this article will be doubled! If measured by the original silver value, it is actually taken away from the original silver worth 800 million taels. The West also has a purpose in making China's reparations calculated in silver, because silver cannot be financially derived like paper money, and after China's silver is exported in large quantities, it will inevitably cause domestic deflation, and they can use silver in exchange for more resources! After they obtain silver, they sell a lot in the international market, resulting in a greater depreciation of the silver price and the pound, and China does not have a financial system and central bank, nor does it have the ability to maintain the price of silver in the international market, so that China will have to pay a greater price when using silver to buy imported goods, and the domestic deflation will be more serious, resulting in a vicious circle. Just like the Asian financial crisis in 1998, the development achievements of the East Asian Dragon for more than 20 years were swept away in a few months, and China's plundering in that year has been lingering in the late Qing Dynasty, and the long time has caused the blood of China's wealth to be lost.

In the case of using real silver without any financial and monetary tools, the imbalance of foreign trade is extremely terrible, and using your real silver to fight against the mature financial system of the other party with paper money, it will be even more terrible, and the Sino-Japanese war is to make China have to have such a confrontation, in the Opium War is to open the customs door of China's material trade, and the Sino-Japanese War is to open the door to China's financial market, which is what the great powers need most, because after China also planted its own opium, opium imports were greatly reduced. The Western powers once again found that China was about to begin to enter the superpower, but China's resources, silk and tea were the necessities of the powers, and reversing such an economic situation was no longer solved by opening the treaty ports of the Opium War to legalize the opium trade, so the financial and monetary war against China was necessary for the plunder of the great powers. The real starting point of the Qing Dynasty's fiscal deficit was after the Sino-Japanese War, when the deficit was as high as 12.92 million silver taels in 1896 and 13 million taels in 1899. Before that, China's foreign debt was very small, Hu Xueyan's foreign debt was incomparable with the borrowing after the Maguan Treaty, before the Maguan Treaty China was a self-sufficient society without foreign debt, and after the Maguan Treaty, China was saddled with heavy foreign debt burdens, China no longer had a national border that could be fortified in the economic field, China faced the unanimous oppression of the world's powers with one country's strength, how could China not decline, and how could such a decline be solved through simple internal restoration? China's strength must find its own way.

For the silver obtained by the great powers in China, the West also directly went to China to carry out arbitrage activities of gold and silver, because in the West, the price of gold and silver was 1:20, and in China it was about 1:10, and the interest space was huge. Because the Chinese government does not use gold as a currency and does not have gold reserves, gold is more of a jewelry in China, and the private sector does not have the scale, strength and ability to exchange gold and silver for oceans, such gold and silver arbitrage is basically obtained by Western financial capital, so with them around the world, such as: Incas, the requirements for having to pay gold are different, they require China to pay silver instead of gold, the purpose is to earn the difference between gold and silver, and the Chinese government is not willing to pay gold because of taxes and so on. Arbitrage between them is so easy for international financial capital to earn. When China's gold had no room for arbitrage, the great powers wanted China to become gold payments, and on July 2, 1905, on the grounds that the price of silver had fallen, the Qing government forced the Qing government to change the reparations calculated according to the silver price into gold goods debts, and converted the indemnities already paid with silver into gold prices, compensating about 8,000,000 taels.

After the Maguan Treaty, the Western loan to China is a five-cent interest rate that does not seem to be high, but these interests are calculated compound interest, which is very different from our loans that do not count compound interest today, and you take away domestic silver to cause deflation when repaying debts, and as the repayment continues, silver will become less and less, and such deflation will become more and more serious, so such interest is not paper money but real silver repayment and when the loan is going to flow out of the economy, such a huge loan is fundamentally different from a small loan. Because it will cause you to deflation, and in the end the burden on you will be greatly affected by deflation far more than the interest you pay, which is much harsher than the current increase in interest after the house slave loan, which is a tighter and tighter noose, more vicious than China's local interest sharks, such a financial deflation of the chinese ministers can not imagine. Such silver deflation is also different from today's paper money model, huge loans in the paper money model will cause excess liquidity and inflation, inflation will offset interest and even cause actual negative interest rates, so today's major developed countries are competing to be debtor countries, in the era of metal currency is the creditor country is the grandfather, of course, the premise is that you also have to have the force to protect the creditor' rights.

According to He Liping's paper, the stock of silver used in Chinese currency in 1825 should be between 600 million taels and 1.1 billion taels. From 1825 to 1840, the total deficit of China's foreign trade in goods, that is, the scale of the net outflow of silver, was about 40 million silver taels, after which China's silver outflow box inflow was basically balanced ("Re-examination of the Relationship between Opium Trade and Silver Outflow", He Liping, Social Science Front, No. 1, 2007). The reduction in monetary silver caused by the opium trade accounted for about 3.6% to 6.7% of the silver stock of China's currency at that time, and only 40 million taels of silver outflow had caused great pressure on China, and the Maguan Treaty wanted to give Japan 230 million taels of silver, and the subsequent reparations of 450 million taels were even more disasteratic, and for the 900 million taels of wealth of the Hesheng family, more was the value of antique calligraphy and paintings, industrial real estate, and the silver was only less than 30 million taels After the bankruptcy of the standard currency of various countries after the First World War, a large amount of silver flowed into China, and in 1935, China issued paper money and used legal tender to force the exchange of silver dollars (about 0.7 silver dollars per piece of silver dollar), and the whole of China only received 1.4 billion yuan. Therefore, if such indemnities are calculated in real silver, it is understandable what kind of disaster and how deflationary it will cause for China's financial system, so that the reduction of silver money cannot be compensated under the monetary system at that time, and it is conceivable what kind of impact it will have on the national economy. Most of the silver in the world at that time was in China, so much silver to the world market, the silver depreciation of the world market can be imagined.

The silver obtained by the West became the reserve of their currency issuance after The Chinese arbitrage became gold, maintaining the rapid expansion of currency investment under the gold standard system and promoting the economic prosperity of the West, while Japan established the gold standard system, which was also established by relying on the pound sterling obtained from the reparations of the Maguan Treaty as collateral. And China before this basically used precious metals such as silver and copper as currency, for a country that was the world's largest GDP at that time, which meant how much wealth, and with such an outflow, China also became a last-rate country, and there is a fact that China's modern history is not willing to publicly mention, that is, the national revenue of our Republic of China is far lower than that of the late Qing Dynasty, even if the tax rate at the end of the Qing Dynasty is only 5%, the total income of the imperial court is far higher than the government revenue of the Republic of China many years later. However, the tax rate of the Republic of China is even higher in line with the world, and the extent of China's actual decline can be seen here, so many propagandists must put on a big hat of extremely serious taxes and miscellaneous taxes in the late Qing Dynasty.