Chapter 605: Total Loss of Capital (Part 1)

In the great hall of the Grand General’s mansion, Xie Yike sat quietly, watching everyone speak — sometimes listening, sometimes nodding slowly. After years of rest and recuperation, along with the formal attire of a titled lady and the golden headdress she wore, she exuded a faint air of poised grace.

Listen more, speak less, and slow the pace of speech — this was the experience Xie Yike had distilled over the years for dealing with outsiders, and it gave others a sense of gentleness and calm composure.

Wang Dou was absent, so Wang Dou’s mother had his wife appear on his behalf. As Wang Dou’s principal wife and the most honored person in the Eastern Route, the various members of the staff had an obligation to report matters to Xie Yike — such were the proprieties and rituals of rank at this time.

However, Xie Yike was a sensible person and would not presume to participate in the staff’s concrete policy decisions. She merely listened quietly, while each staff member, in turn, politely reported to her.

When facing Wang Dou, Zhang Gui, Qi Tianliang, and the others would occasionally joke and laugh a little, but facing the Marquis’s wife, every one of them was proper and correct, their bearing strictly formal.

“…Hmph. The Civil Affairs Department has resolved to print another batch of grain certificates to ease the certificate shortage in every city and fort, and to make those profiteering merchants who hoard and buy up grain certificates bleed again.”

Zhang Gui spoke angrily as he looked at everyone, his steel-needle-like short whiskers bristling outward one by one — but when he faced Xie Yike, he hurriedly switched to a mild expression.

The methods of the Eight Great Families, though simple, were not so easy to counter.

Long beforehand, they had used every kind of means to hoard and arbitrage-purchase a large quantity of Eastern Route grain certificates.

When grain certificates in the market diminished, it was not so easy for the administrators to detect immediately — and because the certificates were now scarcer, their value rose higher instead, their purchasing power grew stronger, and both soldiers and civilians welcomed this, thinking nothing of it.

Seizing this opportunity, the profiteering merchants used the grain certificates in their hands to buy up grain or other commercial goods in great quantities, causing a shortage of goods in the market. At the same time, they began an external blockade, forbidding outside goods from flowing in. Prices began to soar violently; sometimes even grain certificates could not buy anything, or what they bought was far inferior to before — the certificates had devalued.

Trust is a thing hard to maintain but very easy to destroy, and human psychology is to buy when prices rise, not when they fall.

Some soldiers and civilians in the Eastern Route began to grow suspicious of these grain certificates; some even reverted to using copper cash. And at this moment, the various profiteering merchants began using silver or other means to exchange for large quantities of grain certificates from the hands of the soldiers and civilians.

By this point the Civil Affairs Department had caught on. One cannot blame them for being slow to react — after all, each of the great families was a major house with a century of commercial operations, unfathomably deep in foundation, and extremely experienced in commercial warfare. Without the backing of military force, the merchants of the Eastern Route might not necessarily have been able to contend with them.

Fortunately, the Eastern Route at this time had a stable system and a relatively rapid response. Had this happened anywhere else in the Great Ming, the administrators might still be dazed and bewildered, not knowing what was happening even if they died.

Jointly with the Finance Department, the Civil Affairs Department released a batch of commercial goods into the market, slightly stabilizing the situation. But very quickly, large quantities of goods were bought up again by people using vast amounts of grain certificates, prices soared fiercely once more, and soldiers and civilians grew even more suspicious of the certificates. The various profiteering merchants again used every kind of means to exchange for large quantities of grain certificates from the hands of the soldiers and civilians.

This happened several times, and as external goods flowed in ever more sparsely, prices climbed higher and higher — especially the prices of salt and tea.

Sometimes when the Civil Affairs Department released goods, some people had no grain certificates left in hand and had to revert to using silver or copper cash.

Seeing the grain certificates in their hands grow ever more worthless, panic inevitably arose among the civilian soldiers. And at this time, faint rumors also circulated in the Eastern Route, claiming that the grain certificates had already become like the Great Ming treasure notes — that the Civil Affairs Department considered the certificates about to become waste paper and intended to abolish their issuance, restoring the use of silver, and that everyone should hurry to exchange their grain certificates back for grain, rice, flour, and noodles.

A single word startles the dreamer awake. Over these years, the people of the Eastern Route had long treated grain certificates as silver and had already forgotten that they were equivalent in value to grain.

The concept of a run had vanished from many people’s minds. Yes — back then, they had obtained their grain certificates by exchanging grain they had toiled bitterly to grow, or silver they had saved up. Naturally, before they turned into waste paper, they must get their capital back.

In some places, a run on grain and rice began to stir. Because the Finance Department continuously transported grain and rice from the granary reserves to the various grain shops and still redeemed them in full, many soldiers and civilians came back to their senses.

In addition, Xie Yike toured the Eastern Route to calm people’s hearts, and the hearts of the soldiers and civilians grew even more settled.

Yet anyone could see that this was merely the calm before the storm.

The current situation in the Eastern Route was this: grain certificates in the market were dwindling, suspicion toward them was deepening, many dared not use them and merely held them in hand to wait and see, commercial goods were likewise growing scarcer, and any stir of wind or grass would trigger panic.

“…Did I, Old Zhang, labor so bitterly to create these grain certificates for nothing?”

Zhang Gui was furious.

He roared, “If they want to crush the thing I poured my heart’s blood into making, unless I die!”

Sitting slightly behind him was Ye Xizhi, nearing forty, of medium build, with a round, fair face, a few short whiskers beneath his chin, and a spirited, animated look as he glanced about. He held posts not only in the Civil Affairs Department but concurrently in the Education Department.

Over the years he had been highly valued by Zhang Gui, and as he was Wang Zheng’s teacher, his status was rather transcendent — he could accompany Zhang Gui into the General’s mansion for discussions and even had a chair to sit on.

Like his close friend Qin Yi, the two of them, in different domains — one military, one civil — were both gradually revealing their worth.

He spoke with assurance: “In this student’s view, the profiteering merchants’ scheme has two aspects.”

“First, to strike at our Eastern Route grain certificates, deal a heavy blow to our region’s operations, and also show outsiders that while the Jingbian Army may be formidable in battle, in commerce and livelihood, they must still look to the merchants. If this scheme succeeds, then even if the Grand General enters and garrisons the garrison city, the benefits of the grain certificates will turn to bubbles, and hereafter we will have to revert to using silver coin. And if we use silver coin, then later, without a sound, those villains can make the operations of Xuanzhen seethe with panic.”

Everyone nodded. It was indeed so. In fact, from the very beginning, the Eastern Route had used grain certificates and silver concurrently — only the grain certificates’ redemption value remained constant, while silver coin fluctuated and rose and fell. Especially in years of great disaster, the advantages of the grain certificates stood out even more.

In the Eastern Route, even after the grain certificates were issued and circulated, the use of silver had never been prohibited. It was only because the certificates’ value grew ever higher and their grain-redemption rate was stable that, imperceptibly, silver gradually withdrew from the circulation market.

Outside merchants, too, had no choice but to exchange for silver certificates to use, and the exchange ratio kept climbing steadily. Even when soldiers returned from campaigns, they wanted grain certificates, not silver — though of course, now merit points were even more popular than grain certificates.

“Second, the profiteering merchants are hoarding and cornering goods, gathering up grain certificates, also with the intent of reaping profit and making a huge haul when the time comes.”

Ye Xizhi stroked the short whiskers beneath his chin and said, “At present, commercial goods in the Eastern Route are critically scarce, and the higher the prices climb, once they reach a certain level of increase, they will certainly dump their goods and carry off the wealth that the common people within the route have accumulated over many years. At the same time, they will stage a run on the grain certificates at every grain shop, once again triggering panic while seizing vast quantities of grain and rice, gorging themselves on plunder before returning. Their malice is truly vicious!”

A chill rose in everyone’s hearts. Profiteering merchants indeed — their villainy was ingrained to the bone. If the Eastern Route suffered such a blow, how could any vitality remain?

Lin Daofu, Director of the Training Department, reacted first: “We should issue a proclamation forbidding the populace from running on the grain certificates, and at the same time search and confiscate the storehouses and goods depots of the profiteering merchants everywhere. Presumably the Intelligence Department has already grasped all the dens of the profiteering merchants within the route?”

“That won’t do!”

Zhong Rong, Zhang Gui, and Qi Tianliang said it simultaneously.

Zhang Gui said, “If we forbid the populace from running on the grain certificates, wouldn’t that be confessing to the outside world that our grain certificates have truly become waste paper?”

Zhong Rong said, “The Grand General has issued a directive: to wage commercial war openly and honorably against the profiteering merchants, and to proclaim to those outside the route that our Eastern Route excels not only in martial achievements but equally in civil governance. At present, the whole realm is watching, with countless pairs of eyes upon us — we cannot pursue such a risky policy.”

Lin Daofu shook his head. He was a complete blank when it came to matters of management — better to speak less and concentrate on training troops.

“Even if we are to search and confiscate, we must wait until after the war is over.”

Qi Tianliang, still as gaunt and lean as ever, was rather tempted by the wealth of the profiteering merchants, and so he added this remark.

A cold gleam flickered in his eyes as he spoke again: “However, Old Qi is somewhat puzzled. During the commercial war, how did the profiteering merchants of the various great families manage to arbitrage-purchase such large quantities of Eastern Route grain certificates so easily? And in the commercial warfare that followed, there have been quite a few suspicious points. Is there perhaps something fishy here?”

He continued, “One must know that in the past, to guard against spies, all merchants in the Eastern Route, in every department and every city, followed the example of Shunxiang Fort and implemented a merchant registry system. Only after registration and review were they permitted to open for business. Outside merchants wishing to settle and operate in the Eastern Route must also have a local person of clean background act as guarantor, under a collective responsibility system. If those merchants caused trouble, the guarantor would share the punishment. With such strict measures, yet still…”

Zhang Gui burst out roaring, “There must be a traitor within! There must be some wolf-hearted, dog-lunged wretches within the route colluding in secret with those villainous scoundrels!”

The hall fell silent. Everyone’s gaze turned toward Liu Benshen, the Internal Affairs Chief of the Intelligence Department, each face filled with fury — only Feng Dachang, the Documents Chief, still sat upright and composed, maintaining his fine bearing.

Liu Benshen sat expressionless. He said, “This matter, I have already reported to the Grand General. When the Grand General returns, the truth will naturally come to light.”

Xie Yike said, “The matter of the internal traitor shall be discussed upon the Grand General’s return.”

Her face tinged with worry, she asked Zhang Gui, “Director Zhang, the profiteering merchants press closer step by step — does the Civil Affairs Department have a method to respond?”

Zhang Gui hurriedly said, “Madam, please set your mind at ease. Your subordinate long ago drafted a detailed plan that will certainly make those villains return having lost their entire capital.”

He reported in detail for a while. The key point was the need for the full support of the Finance Department.

Xie Yike looked toward Zhong Rong: “Mr. Zhong, are the grain reserves and commercial goods in the various granaries sufficient?”

Zhong Rong bowed and said respectfully, “In reply to Madam, the autumn grain has long since been put into storage, and with the purchase of surplus grain from the various military households, the granaries hold a great deal of stored grain.”

“The armies and merchant houses beyond the frontier have long since gathered in droves at Man Tao’er and other places — it is simply that no public announcement has been made. They have brought back an incalculable quantity of commercial goods. The various outward-bound purchasing caravans have also been returning one after another. The reserves of coin, silver, grain, fodder, and all manner of commercial goods in the storehouses will all be extremely abundant.”

“Those villains, treating our Eastern Route as an ordinary place, will surely reap the bitter fruit of their own deeds!”

Zhang Gui burst out laughing: “Exactly. Just when those treacherous merchants think they can dump their goods, we flood the markets with supplies, forcing them to sell at a loss just to offload… As for the grain depot, there’s even less to worry about. If they want a run, let them run… Haha, I can’t wait to see how they die!”

Xie Xiuniang set her mind at ease and said, “With the Grand General away, I must trouble you gentlemen to toil over the affairs within the circuit.”

Everyone promptly rose together, bowed, and said, “My Lady speaks too gravely. This is our duty as subordinates; we shall naturally exert ourselves to the utmost.” (To be continued. For exciting novels, remember our web address:)