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paper note from
Yuan Dynasty
equals 200 units of coins |
When the descendants of Genghis Khan ruled China,
paper notes were their choice of currency. They were rather prudent at the
beginning, but a couple of decades later, after the royalties fully explored
their privileges, the fiscal revenues were not able to cover the enormous
military expenditure and royalties’ luxurious lifestyles. They discarded the
conservative monetary policy, and began to over-supply the paper notes. The inflation
and several natural disasters made people’s lives insufferable. The emperor of
Yuan Dynasty was overthrown, and their 98-year of ruling was ended.
Though issuing paper notes was a step-up in the history
of money, every ruler used it as a method to exploit common people. In the
first years of Ming Dynasty, paper notes along with copper coins formed their
monetary system. But there was no limitation on how much money to put into
circulation, and no reserve necessary. After causing a severe inflation, the
paper notes monetary system collapsed, and silver-based currency became
popular.
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| Silver ingot |
The last dynasty in China, Qing, used silver ingots
as principal currency in the first 100 years of their ruling. Large business
transactions were all carried out using silver ingots. Taxes were also paid in
silver. Since the central government didn’t have a standard for how to mint
silver, the silver ingots in circulation were in different shapes, quality and
weight. They had to be melted and purified before they can be collected as
taxes. Some government officials conspired with silversmiths to exploit people
by downplaying the quality and weight of their silver, and a lot of complicated
social problems were the results of this kind of malpractice.
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