prosperous age

"Sir, Tianjin news: the treasure ship has safely arrived at port. Lord Lao and Eunuch Zhang are now leading people to count the gold and silver that have been brought back."

In the middle of the night, just as Wei Guangde was about to go to sleep, a maid suddenly came in to report that Steward Zhang was waiting at the inner courtyard gate and had something important to report.

Wei Guangde went out in his pajamas and heard Zhang Ji's report at the courtyard gate.

"You're back, that's good, that's good."

Wei Guangde muttered a few words to himself, then said, "Alright, you should get some rest too."

Heaven knows what kind of mess the Ministry of Revenue has been in lately because of money.

Before the New Year, a batch of expenses that had been planned long ago were allocated to the Ministry of War by Emperor Wanli, who said, "We must ensure that the army on the eastern expedition is rewarded." The Ministry of Revenue then allocated the silver to the Ministry of War to prepare money, beef, mutton, wine, and meat to be sent over.

Many expenditures were thus put on hold, causing quite a stir among the various departments.

Of course, the Ministry of Revenue's obedient allocation of funds was also because Zhang Xueyan knew the importance of the Eastern Expeditionary Army, and with Wei Guangde watching from behind, he had no choice but to provide the funds.

Now things are much better; the silver has returned, and the Ministry of Revenue has money.

The gold and silver ingots worth a million taels of silver were cast into Tongbao coins. This alone would bring the Ministry of Revenue an income of 100,000 taels of silver. Not to mention that, apart from the portion that was moved into the palace, the Ministry of Revenue would have to make up for the previous deficit.

The next day, Wei Guangde entered the cabinet early in the morning. Although the New Year had just passed, the festive atmosphere of the New Year was still present in the palace.

The palace lanterns hanging along the palace road still hang high, enhancing the festive atmosphere.

"Yes, make more palace lanterns next year and hang them on all the main streets of Beijing."

Wei Guangde thought to himself.

In later generations, during the Spring Festival, streets everywhere were decorated with colorful lanterns and red lanterns to create a festive atmosphere.

If the capital city were to do the same in this era, the results would likely be even better.

Soon, Wei Guangde entered the cabinet.

Upon arriving at the entrance of the duty room, they saw Lu Bu standing at the door with a eunuch.

"Eunuch Li, you've come so early in the morning. Is there something going on at the palace?"

Wei Guangde was taken aback. He recognized the man; he was one of the eunuchs on duty at the Qianqing Palace and also a court attendant of the Directorate of Ceremonial. His presence here at this time usually meant that the palace needed him for something.

"Your Excellency, I have come with an imperial edict from the Emperor, which I wish to personally deliver to Grand Secretary Wei."

Even Eunuch Li dared not presume before Wei Guangde, and with a slight bow, he handed a memorial to Wei Guangde with both hands.

"Imperial decree from His Majesty?"

Wei Guangde was taken aback. Thinking of the memorial submitted to the Directorate of Ceremonial yesterday, Wei Guangde knew that Zhang Hong must have delivered it to the Wanli Emperor overnight and sent it over this morning.

As for the content of the memorial, it was naturally about restoring the academies throughout the land.

This was planned in advance, and the emperor had been informed beforehand, which is why it went so smoothly.

He reached out and took it, opened it, and sure enough, it was this memorial.

"Thank you for making this trip, Eunuch Li. Please come in and have some tea and rest."

With a smile, Wei Guangde invited Eunuch Li into the duty room.

"Thank you for your kindness, Your Excellency. I have servants to attend to His Majesty, so I won't disturb you any longer."

"By the way, His Majesty was very happy yesterday because a messenger from Eunuch Zhang's side delivered a message to the palace."

Suddenly, Eunuch Li smiled and said to Wei Guangde.

"Hehe, that's only because His Majesty is so blessed that the fleet returned to port safely."

Wei Guangde smiled, holding the memorial in his left hand, and subtly pulled a piece of paper from his sleeve with his right hand and handed it over.

Eunuch Li bowed respectfully, took the paper from Wei Guangde's hand, and then turned to leave.

This eunuch Li was in the Qianqing Palace and was on good terms with Liu Ruoyu. Occasionally, he would pass on a message for him.

However, he was not one of Chen Ju's men. He served as the chief eunuch of Yonghe Palace in the palace, so Wei Guangde would usually give him a small amount of money as a tea fee after each time he helped someone.

These are all pawn tickets from the Wei family pawnshop. With these tickets, you can redeem ten taels of silver or items worth ten taels.

Carrying pawn tickets is much more convenient than carrying a money bag filled with silver coins that clink together.

Wei Guangde took the memorial back to his room, quickly drafted an imperial edict, and then had Lu Bu deliver it.

Restoring academies throughout the country was naturally not a bad thing for the civil service of the Ming Dynasty, and no one would object to it.

However, besides issuing this decree today, Wei Guangde was also thinking about another matter: with the imperial examination just around the corner, he needed to go to the palace to inquire about the chief examiner.

Between Yu Youding and Xu Guo, who did Emperor Wanli ultimately prefer to serve as the chief examiner for this examination?

But there's no rush; we can go to the palace to pay our respects later.

Wei Guangde sat in his seat, leisurely taking a sip of the freshly brewed tea, when he suddenly heard Zeng Shengwu's voice coming from outside the door.

"Can the loan service be provided in the duty room?"

"The master is inside. I will inform him immediately."

Upon seeing that it was Minister Zeng, Lu Bu hurriedly replied.

"No need, I'll go find him myself."

Zeng Shengwu spoke in a hurry and didn't wait for Lu Bu to come in and announce his arrival before rushing into the house.

When Wei Guangde saw him, he quickly got up and went to greet him.

"Brother Sansheng, what's the matter that you're in such a hurry? Sit down first and tell me slowly."

Wei Guangdala urged Zeng Shengwu to sit down and then asked Lu Bu to make tea.

“Shan Dai, I’ve discovered something here that’s become extremely urgent.”

However, Zeng Shengwu did not wait quietly for the tea to be served, but spoke directly to Wei Guangde.

"What happened?"

Wei Guangde was greatly surprised. He hadn't heard a word about it. What big thing could have happened in or outside the capital?

Even if it were true, it shouldn't be him, the Grand Secretary, who should know first. Why would the Ministry of Justice be so eager to find out?

"The other day, my Ministry of Justice received a petition from a scholar from Zhejiang who was traveling to the capital for the imperial examinations but was being pressured by his creditors to the point that he could not concentrate on his studies and had no choice but to seek help from the government."

When I investigated, I was shocked to find that he had come to the capital from Zhejiang four months ago to take the imperial examination. He had borrowed 500 taels of silver, and in just four months, he had already turned it into more than 2,000 taels of silver.

This is not an isolated case; many candidates preparing for the imperial examinations in Beijing are burdened with similar debts.

I'd only ever heard of "capital bonds" before; I never imagined that someone would have this idea as early as when the scholars went to the capital for the imperial examinations.

Zeng Shengwu's words made Wei Guangde frown slightly, and he asked, "How could five hundred taels of silver have more than tripled in April?"

"Nine times out, thirteen times back, one month to go."

Zeng Shengwu said bitterly, "I had someone investigate this loan shark. He's known locally as Iron Abacus. He doesn't do any production; he's just a money lender who lives off high-interest loans. He must have some money, so he's planning to come to the capital and get involved."

Upon hearing that it was a money-lending household, Wei Guangde nodded slightly.

"Ziqianhu" is actually a special term used in ancient China to refer to usurers who engaged in monetary lending. The term originated from the economic concept that "money can generate money," referring to operators who charged interest by lending out principal.

For this type of person, there were already laws in the Ming Dynasty, which stipulated that the monthly interest rate should not exceed 3%, and the annual interest rate should be 36%, and it was also strictly stipulated that "the interest should not cover the principal" when the loan cannot be repaid.

Despite these regulations, borrowers often circumvent them by signing new loan agreements to avoid government punishment.

There are many natural reasons for this. Not only do they have connections with local gentry, but they also have people in the government who speak on their behalf, and they often keep a group of ruffians and scoundrels under their command.

Even if the loan agreement states a monthly interest rate of 3%, the actual interest rate received is often 5% or even higher.

"Four months, turning a profit every month?"

Wei Guangde was still somewhat surprised that someone would dare to borrow at such an interest rate, especially a scholar who had passed the imperial examinations. "What kind of place is the capital? According to him, he heard that the interest rates on bonds issued in the capital are not low either. A few hundred taels of silver can multiply to tens of thousands of taels in just a few years. He only borrowed money locally through acquaintances in order to pay less interest."

I thought it was issued once a year, but it turns out it's issued once a month.

He was clearly scammed; they probably only wanted his family's land.

Zeng Shengwu smiled wryly.

"His family owns land, so why does he need to borrow money?"

Wei Guangde frowned slightly and asked in surprise.

“If you pass the imperial examination, people will naturally offer you gifts. Even under the new law, government land is exempt from taxes.”

Zeng Shengwu began to speak.

"Hehe, I understand now. Usury is a means of seizing land."

Previously, the target was independent farmers; now, scholars are also being targeted.

Wei Guangde chuckled, then looked at Zeng Shengwu seriously, "How much did you find out, and what's the situation?"

"I took on the case the day before yesterday. Since it involved the imperial examination, I immediately had someone investigate it. The result was beyond my expectations."

Zeng Shengwu simply said in a low voice.

"Beijing bonds?"

Wei Guangde asked in surprise.

"Ah."

Zeng Shengwu nodded.

"I've heard of it before, but I've never had any contact with it."

As you know, I'm not involved in this.

Wei Guangde spoke calmly.

“I know you lend money, and you do so in accordance with the regulations of the imperial court. Moreover, the merchants trust you. Otherwise, I would have impeached you long ago.”

Zeng Shengwu glanced at Wei Guangde and said directly.

Wei Guangde remained expressionless, simply waiting for Zeng Shengwu to continue.

Immediately afterwards, Zeng Shengwu explained the details of the Beijing debts he had found to Wei Guangde.

When he heard that nearly half of the newly appointed Jinshi (successful candidates in the highest imperial examinations) had taken out loans in the capital, his expression changed slightly.

"Beijing Debt" was a special type of usury that appeared in Chinese history. Unlike the people who borrowed money at high interest rates in reality, those who borrowed from Beijing Debt were often not people from the lower class who could not make ends meet. Instead, scholars and officials were mostly among them.

It is a usury model that started in the Tang Dynasty and gradually became popular in the Ming Dynasty.

According to researchers, "capital bonds" may have existed as early as the Han Dynasty, targeting officials in the capital.

After the imperial examination system was established, it gradually shifted to the candidates taking the exams, especially the newly appointed Jinshi (successful candidates in the highest imperial examinations).

Bai Juyi's line "Living in the capital is not easy" actually subtly reveals the debts in the capital during the Tang Dynasty.

The "Annals of Emperor Wuzong" in the Old Book of Tang actually records a description of debts in the capital: "Many officials who went to be selected had debts in the capital, which they repaid upon taking office."

The cost of living in the capital was high, and scholars needed to maintain a high standard of living and present themselves in a respectable manner. Newly appointed Jinshi (successful candidates in the highest imperial examinations) also had to observe politics and be selected for official positions in the capital, all of which were huge expenses.

For people from ordinary families, it is simply unaffordable.

This is also why Wei Guangde once lent a large amount of money to his fellow students. If Wei Guangde hadn't lent them money to live on, they would probably have had no choice but to borrow money from the capital.

Then, once he was appointed to an official position, he would go to the local area to recoup the principal and interest, thus settling the loan deal.

Most of the debts in the capital were specifically for candidates for official positions, hence they were also known as official debts. This led to the rampant buying and selling of official titles in the late Ming Dynasty.

It can be said that the emergence of the capital bond was largely the root cause of the rampant corruption problem in the late Ming Dynasty.

"According to the information I had someone investigate, many people who borrowed money from the capital were able to repay it twice over with the funds stored in the government treasury upon their reinstatement."

"Shan Dai, think about the problems that arose in local government treasuries earlier; this is the root cause."

Zeng Shengwu concluded.

The Ming Dynasty's treasury was severely depleted, but reports from below mostly stated that the damage was due to improper storage, and those responsible were punished.

At the time, Wei Guangde also speculated that there might have been embezzlement by warehouse managers, such as passing off inferior goods as superior ones.

But now, hearing Zeng Shengwu's words, he realized that the new official had emptied the government treasury by first exchanging the Beijing bonds.

“The practice of usury has reached a point where it can no longer be ignored; these loan sharks must be severely punished.”

Seeing that Wei Guangde remained silent, Zeng Shengwu hurriedly spoke again.

"Punishment alone is not enough."

Wei Guangde shook his head. "They need to borrow money, but they're just borrowing from the wrong people."

By eliminating usury, Wei Guangde wouldn't mind giving up this lucrative business, but in the end, it's the borrowers who urgently need the money who truly suffer.

"I had previously planned to establish the Great Ming Money Shop, with investment from the imperial court and meritorious officials, to lend money at the interest rates stipulated in the imperial laws, while also engaging in 'flying money' business, with bills accepted for exchange."

Previously, Wei Guangde had only treated lending as a business, but when Zeng Shengwu came to him today and told him that the prevalence of usury was beyond imagination, he realized that the Ming Dynasty needed to rectify the financial industry.

Otherwise, an out-of-control financial industry would ruin the prosperous state of the Ming Dynasty.

His earlier idea of ​​establishing a money exchange was only discussed with those around him, and he did not tell Zeng Shengwu about it.

Since Zeng Shengwu had noticed this matter, Wei Guangde took the opportunity to bring it up and hear his opinion.

"The best approach is to regulate the behavior of money lenders in the market through the Ming Dynasty's money exchange system and lower the interest rates they charge."

Blindly banning it will not be effective.

Ultimately, if there's a need, it can't be stopped; the only right approach is to find ways to lower lending rates.

After explaining his thoughts, Wei Guangde emphasized that Zeng Shengwu's idea of ​​banning private lending was wishful thinking, and that reasonable guidance was the right way.

At this moment, Wei Guangde couldn't help but think of the nascent capitalism that was stifled by several dynasties in ancient China.

The deeply abhorred notion of "foreigners eating people" is actually a result of the different development directions of the East and the West.

During the Ming Dynasty, after merchants profited from their business activities, they would initially, like Western merchants, invest heavily in workshops to further increase their profits.

and then?
And that was it; they used the profits from their commercial activities to invest in shops and land, thus becoming the landlord class.

At the same time, they would also take out the gold and silver in their homes to lend out and engage in usury.

In the West, merchants, especially textile merchants, bought large amounts of land to raise sheep, which was known as "sheep eating people."

But their goal was not to become landowners or lords, but to do business.

Wool will help them reduce their dependence on imported raw materials, expand their business, and then explore new markets.

This is the fundamental reason why the East and the West developed in two completely different directions at the same time. In an era when all other professions were considered inferior, merchants still strived to become scholars.

Since the West did not have the constraints of the imperial examination system, they could only pursue money.

Of course, it's not that there are no lenders in the West; it's just that Western countries are small, capital is highly mobile, and this keeps lending rates low.

In the West, commercial lending is far more effective than in the East, greatly promoting economic development.

"This matter is too important; let me think about it before I answer."

Zeng Shengwu did not immediately respond, but said... (End of Chapter)