The Qing Dynasty

Chapter 578 Yixin’s Help

Teng Yuzao continued, "What Yikuang did is nothing to us for now. It just caused us some trouble, but it also served as a reminder to us."

"In the future, no matter how great the temptation of profit is, our banks must keep sufficient reserves to prevent being attacked and causing bank runs. This should be an iron rule."

Seeing Xi Ligong nodded his agreement solemnly, Teng Yuzao continued.

"Although banknotes cannot be issued for the time being, the issuance of gold coins must be accelerated."

When people in the conference room heard Teng Yuzao suddenly say that gold coins should be issued, the expressions on their faces became complicated. Obviously, many people did not agree with the issuance of gold coins.

But most people in the conference room had no say in this matter, not only the former Chinese students who studied in the United States who were invited to attend the meeting, but also the generals.

The others who were qualified to interrupt, including Zhou Fu and other high-ranking officials such as Yang Shixiang and Xu Shichang, did not know much about these financial matters, but they all disagreed with Teng Yuzao's statement.

Only Zhou Xuexi, Ning Xingpu, and Huang Chujiu had a thoughtful expression.

Zhou Fu asked with some doubt, "Xingfu, we have little gold in our country, but plenty of silver. If we issue gold coins, they won't circulate at all."

Perhaps worried that Teng Yuzhao didn't understand, Zhou Fu continued.

"It's not that the gold coins can't be issued, but quite the contrary. The gold coins will definitely be very popular. It is estimated that once they are released, they will be snapped up immediately. As many as there are will be bought."

"However, once these gold coins are sold, they will no longer be seen on the market. All of these gold coins will be bought by wealthy families and collected at home."

"Just like when Zhang Xiangtao minted silver coins in Guangdong, they were all hidden in people's homes."

Teng Yuzao understood Zhou Fu's meaning very well. The higher the silver content of a silver coin, the easier it would be for it to be kept in people's hands, and the silver coins in circulation would be those with lower silver content.

Since gold is difficult to combine with other metals, gold coins are all pure gold. Once these gold coins flow out, they will be hidden at home, or even melted down and recast into gold bars for collection.

Teng Yuzhao understands the Chinese people's habit of collecting gold, but he also feels helpless.

Teng Yuzao sighed and smiled bitterly, "Don't worry, Lord Zhou. We didn't expect these gold coins to be circulated in a short period of time. It doesn't matter if they are collected by others."

Teng Yuzhao's words made these people even more confused and speechless.

Why issue them if you don’t expect them to circulate?
In fact, Teng Yuzao had already had the idea of ​​issuing gold coins a long time ago. There was even a minting machine purchased specifically for minting gold coins in the mint of Aurora Bank, which could mint more than 100,000 gold coins a day at any time.

You know, Teng Yuzhao still has a large amount of gold confiscated from the royal palaces in the capital.

These gold cannot just stay idle in the vault. Putting them into circulation will not only greatly ease financial pressure, but also make a profit.

Teng Yuzhao knew very well that the price ratio between gold and silver was high until the outbreak of World War I.

For example, the gold-silver exchange rate at that time was about 1:38. If you sold all the gold in your hand and exchanged it for silver, and then bought back a large amount of gold during World War I, it would be a huge profit.

Moreover, in the past three hundred years, due to the low domestic gold price, the existing gold was purchased in large quantities from the country by merchants from the powerful countries using silver. As a result, the domestic silver reserves were extremely sufficient, while gold was already very scarce. This caused the domestic gold price to gradually rise, eventually reaching a point where it almost caught up with the international gold-silver price ratio.

Although Teng Yuzhao had been secretly preparing for this matter for a long time, only Xi Ligong knew about it.

In order to mint gold coins, Teng Yuzhao also asked Xi Ligong to use the name of civilian needs to use various channels to obtain foreign currencies from the great powers, and to purchase gold in small batches from foreign banks in China or even directly from abroad.

The purchase of gold was used, on the one hand, to increase the stock of gold for minting, and on the other hand, to cover up the gold in his hands whose source could not be explained.

Moreover, he had a large amount of banknotes from various powerful countries that he had copied from the concession banks, and this money also needed to be spent.

Teng Yuzao looked around at everyone and said with a smile, "You all feel very strange, right? Actually, my purpose is very simple. I don't worry about whether they can be circulated in the market. As long as they can be exchanged for silver, that's all."

"Even if the gold coins we mint are all bought by others, they will still have to exchange them for silver, and the silver they take out will still circulate in the market."

"Of course, after we handle it, there will be no more silver in circulation, and it will only become silver dollars flowing out."

Teng Yuzhao's explanation made everyone understand what he meant.

Teng Yuzao continued, "There is another point that you may not be very clear about. The current gold-silver price ratio in China and abroad is not much different. It basically fluctuates below 1:40. The gold price is a bit too high."

"This is mainly because the currencies of the great powers are gradually moving closer to the British, and there is a trend of abolishing the gold and silver dual standard and adopting the gold standard like the British. This trend will gradually spread."

"This will gradually stabilize the price of gold. Unless a large-scale war breaks out among the Western powers, they will take out a large amount of gold, and then the price of gold will fall."

"In my opinion, although the silver price may fall sharply again, it is only temporary. In the long run, the gold-silver price ratio will gradually narrow, which means that the silver price will rise, especially in China."

Teng Yuzao knew very well that it was not until the outbreak of the First World War that the gold-silver price ratio began to decline, reaching around 1920:1929 in , and then slowly rebounded to around : in .

Seeing that the more people listened to him, the more confused they seemed to be, Teng Yuzao no longer wanted to explain the trend of the gold-silver price ratio to them. He couldn't even make the incredible prediction that there would be a tragic world war.

Teng Yuzao simply got straight to the point, "Yucheng has been storing up a large amount of gold for some time, and has even bought a minting machine specifically for minting gold coins. Now that Yikuang has caused us trouble, we can just launch the gold coins."

"First, it can ease our cash pressure, and second, it can let the world see that we were forced by Yikuang to hand over even the gold in our hands, which can increase the world's sympathy for us."

Teng Yuzao turned to Xi Ligong and said, "The first batch will be 200,000 gold coins, which can be minted in the same way as the gold coins with a face value of one pound."

At this time, the one-pound gold coin contained 7.32238 grams of gold, and the gold content was %. Due to the casting cost and what the Chinese called fire consumption, it was worth seven taels of silver, or ten silver dollars.

Except for Zhou Shoushen, who had served as an ambassador abroad, no one else present had any impression of the British gold coin with a face value of one pound, and Teng Yuzao did not elaborate.

Of course, Teng Yuzao could also roughly calculate that based on the silver content of the silver dollars currently issued by the Aurora Bank, they would be worth more than sixty yuan.

Teng Yuzao smiled and said to everyone, "Although the number of issues is not large, it also lets the world know that our Aurora Bank is still strong." "More."

Teng Yuzao then asked Xi Ligong, "Yucheng, how much capital does the bank run by Yikuang have?"

"They claim to have 20 million in capital, but I estimate that they have less than 10 million at most."

Teng Yuzao nodded and said, "Yucheng, we should also adjust our capital. We should include the profits of Aurora Industrial Development Company, Aurora Trading Company, and Aurora People's Livelihood Development Company since their establishment in the past year, and then officially announce to the public that the capital of Aurora Bank is 80 million."

Teng Yuzao felt very aggrieved that he had to hide a large amount of funds all the time. Now he could take the opportunity to pretend to compete with Yikuang and increase the capital of Aurora Bank significantly.

As for whether the profits of several companies belonging to him would be counted into the principal of Aurora Bank, Teng Yuzhao didn't care.

Teng Yuzao casually mentioned the principal of 80 million, which surprised everyone at first, and then they all smiled knowingly.

Except for Xi Ligong, Li Yulin and Li Xianze, the rest of the people thought that Teng Yuzao was bluffing.

However, Teng Yuzao said that the profits of the other three companies should also be included in the "Aurora Bank". This made Zhou Fu, Yang Shixiang, Xu Shichang, Yang Shiqi, Zhou Xuexi, Wei Jinghai and others look at Teng Yuzao with more and more admiration.

They all knew that Teng Yuzao had said that he would not use the money of Aurora Bank, which was equivalent to Teng Yuzao giving his own money to Aurora Bank.

Unexpectedly, Xi Ligong, who already understood Teng Yuzhao's meaning, said with a smile.

"Marshal, Yikuang's Capital Commercial Bank claims to have 20 million. The 80 million you mentioned is still a bit too little. In my opinion, we should at least quote 120 million."

Teng Yuzao smiled and said, "Okay! One hundred and twenty million."

Although he admired Teng Yuzao's action of taking out his own money and investing it in Aurora Bank without hesitation, Zhou Fu still felt guilty about Teng Yuzao's false reporting of such a large amount of capital.

Zhou Fu sighed softly and said, "Xingfu, big banks like HSBC and Citibank only have a capital of 10 or 20 million taels. Isn't your capital of 120 million a bit too exaggerated?"

Zhou Fu's words made Teng Yuzao laugh.

Teng Yuzao shook his head and said, "Mr. Zhou, 120 million is equivalent to nearly 20 million pounds. Not to mention HSBC and Citibank, I guess even if you add up the capital of all the foreign banks in China, they may not have that much."

Teng Yuzao said in high spirits, "Although our figures are inflated, the principal of any bank, money house, or ticket exchange is not inflated."

"Moreover, most of the foreign investment loans in Zhili and Shandong provinces are handled by the Aurora Bank. Its turnover is much higher, so how can its returns be bad? If it is successfully implemented, in time, let alone 120 million, even if we add another zero, it will be no problem at all."

"In addition, Aurora Bank also has its own investments, and for this I will also launch a stock exchange, which can also invest idle funds in the stock market to earn dividends."

Speaking of the exchange, Teng Yuzao said again.

"Yucheng has now sent the market entry rules to Zhili enterprises that want to be listed, as well as the requirements for these enterprises to standardize their operations. The specific requirements will be published in the Ta Kung Pao tomorrow."

"At present, only enterprises established in Zhili and Shandong provinces are allowed to apply for listing. As for other provinces, it can only be expanded in the future."

"Even if he had to give half of the stamp duty from the stock exchange to the Governor's Office, he would still have made a lot of money."

To make it more convincing, Teng Yuzao added.

"In order to support the successful opening of the exchange, all companies under the Aurora Industrial Development Corporation will be listed here, and at least 40% of their shares will be traded. Some companies will even trade more than 50% or even 60% of their shares."

Teng Yuzao's words shocked everyone again, because everyone knew that all the companies under the "Aurora Industrial Development Company" were very profitable companies and had no shortage of funds, but Teng Yuzao actually wanted to list them on the stock market.

Teng Yuzao saw what everyone was thinking and said, "These companies will help me make a lot of money, but making money is not what I desire. What I desire is to see the great success of the Westernization Movement in Zhili."

"Therefore, these profitable companies must go public. In addition to using the funds to expand production and build new factories, they must also support other capable companies, such as through joint ventures."

"In addition, all government-owned enterprises in Zhili and Shandong provinces will also be listed, and except for railways and mines, the rest of the government shares will be gradually withdrawn."

With Yixin's "help", Teng Yuzhao's concern about "Aurora Bank" was finally basically resolved, which made Teng Yuzhao feel very excited.

After signaling Xi Ligong, who was also very excited, to return to his seat, Teng Yuzao also walked back to his seat and sat down.

"Yixing can't turn the tables yet, so let's put this matter aside for now. We'll wait and see, and settle the score with him later."

Teng Yuzao, who had completely put his mind at ease, began to change the subject.

“You must have heard of the World Expo and the Olympics, right?”

Teng Yuzao's words were met with a rare lull in the response. Many people had never heard of these two words and did not even know the words "Olympic Games" and "World Expo".

Teng Yuzao didn't take it seriously and continued.

"In the 30th year of Emperor Guangxu's reign, the World Expo will be held in St. Louis, the eighth largest city in the United States."

“And the third Olympic Games was also held in the United States, in Chicago.”

Afterwards, Teng Yuzao briefly explained to everyone what the World Expo and the Olympic Games were.

After explaining these two terms that were unfamiliar to most people in the conference room, Teng Yuzao said.

“If we want to keep up with the world, we must first understand the world and participate in the world’s affairs.”

"I am now officially telling you that at the invitation of the American Minister Conger, I have submitted a memorial to the Empress Dowager. The court has finally agreed to participate in the World Expo and the Olympic Games, and has handed over these two matters to the Zhili Governor-General's Office for execution."

(End of this chapter)