Chapter 769: The Uses of Gold and Silver

"... Although the various circuits of Qingjiangpu don't know the exact details, they can still roughly estimate the total sum. Quite a few people have come wanting to borrow, and the interest rates offered are all quite good. I was thinking, this silver just sitting in the treasury is useless. If we could lend it out to earn interest, the returns would truly be excellent. With all the trade in goods here in Qingjiangpu, who knows how much silver is flowing in and out every day—they all need to adjust their positions. If your silver, my lord, circulates among these businesses and earns interest, over the course of a year, the profits might be no less than from any of our other enterprises. And besides, with our Zhao Camp standing guard, who would dare try any tricks, who would dare owe a debt and not repay it?" Zhou Xuezhi did not open the ledger in his hands; he had been speaking in an unending torrent. This was the crucial matter Zhou Xuezhi wanted to discuss face-to-face with Zhao Jin. He had long had a complete plan in mind, and seeing Zhao Jin listening with rapt attention made Zhou Xuezhi even more pleased.

Having finished laying out his plan, Zhou Xuezhi could not help but feel thirsty and lifted his tea bowl to drink. Looking at the contemplative Zhao Jin, Zhou Xuezhi could not resist adding another remark: "My lord, with this lending and debt collection, and the adjustment of positions, over time, all the various businesses in Qingjiangpu will be grasped in our hands. Whoever doesn't obey, we simply cut off their silver, and they won't be able to do business. Whose enterprise is booming, if Cloud Mountain Trading wants to enter, we can directly swallow it up, and no one can find any fault with it. In the course of business dealings and the flow of money, who can say we are using force to oppress others?"

After saying this, Zhou Xuezhi coughed and looked at Zhao Jin with some apprehension. In such conversations, Zhou Xuezhi had never felt that Zhao Jin was more than ten years his junior. Zhao Jin often displayed a maturity beyond his years, and at times he was quite rigid, with a firm bottom line in his conduct. What he had just said was, in essence, the method of using force to oppress others. He had spoken freely in the heat of the moment, but would Zhao Jin reprimand him?

Zhao Jin was deep in thought, his expression growing increasingly stern, which only deepened Zhou Xuezhi's unease. Despite Zhao Jin's youth, Zhou Xuezhi always felt an inexplicable pressure when they spoke. From being a mere advisor to a cult leader to becoming the famously influential Chief Steward Zhou of Southern Zhili, Zhou Xuezhi knew who had given him everything. He did not want to lose it.

"Your idea is not bad!" Zhao Jin began to speak, and these words set Zhou Xuezhi's mind at ease. Zhou Xuezhi's idea could not be called a stroke of genius; more than one wealthy merchant in Qingjiangpu with ample funds already practiced lending at interest. But using this lending to control the various businesses of Qingjiangpu, and being able to seize these businesses at critical moments—that was a major inspiration. It reminded Zhao Jin of many, many things from his memories.

"But what you've thought of is still far from enough," Zhao Jin said very slowly, speaking as he reminisced. Zhou Xuezhi, however, involuntarily straightened his posture, his face alight with irrepressible excitement. He knew he had spoken correctly.

"Lending at interest—this business can be done not only in Qingjiangpu, but also in Xuzhou and Yutou Town. Not only can we lend out our own silver to earn interest, we can also let others deposit their own silver with us, and we lend that out to earn interest as well. Now Xuzhou has a great market, Qingjiangpu has a great market, and Yutou Town has its fair. Merchants traveling between these places all have to carry large sums of silver. It's not only inconvenient but also risky. If they were to deposit their silver with our firm, and we issued them a note, they could take a single piece of paper or a token and exchange it for ready silver at any of our branch shops. This business can also be done," Zhao Jin guided patiently.

Zhou Xuezhi leaned forward, afraid of missing a single word. Hearing this, he nodded repeatedly and said, "My lord is right, we can also do these exchange notes."

Notes similar in concept to silver certificates or checks had existed since the Jiajing era, known as exchange notes. They were notes issued by sufficiently powerful merchant houses that could be redeemed for ready silver at their various branches. This mainly served officials and scholars traveling between north and south, and the face values were not large.

"Think further. Our Cloud Mountain Trading, the Sun Family Trading Company, the Zhao Family Trading Company, and others are spread throughout the region north of the Yangtze in Southern Zhili. That means merchants and commoners everywhere here can exchange silver and notes. We have silver in hand, and our reputation is quite good—no one would think we'd renege on our debts. At first, they will still deposit here and redeem there. But as time goes on and our credibility is established, they won't want to go through the trouble of carrying large sums of silver around. They'll just hand over our notes, and the outside world will accept them. Tell me, would the region north of the Yangtze in Southern Zhili stop using silver, and eventually use only the notes we issue?" Zhao Jin smiled as he delved deeper into the topic.

Zhou Xuezhi nodded instinctively, but after just one nod, he froze in place, his eyes unfocused, his entire being lost in thought. He pondered so rudely and abstractedly, and as he thought, his whole body began to tremble. He took several deep breaths before he could speak: "According to what my lord says, in the future, wouldn't we be able to simply issue notes? If our note says one hundred taels, the outside world would treat it as one hundred taels of silver, regardless of whether we actually have that one hundred taels?"

Zhao Jin smiled and nodded. What he had just described was, in plain terms, the rudimentary framework of banking and finance.

At this, Zhou Xuezhi shuddered, shook his head, and said, "But we must absolutely not let it end up like the treasure notes."

"Not if there is credit. This is just one method, not the entire method," Zhao Jin replied with a smile. The Great Ming had once issued paper currency called Great Ming Treasure Notes, but they depreciated extremely quickly, rapidly becoming as worthless as waste paper, and also became a means for the Ming imperial clan and nobility to exploit the common people. But that was because the Ming imperial house did not cherish its own credit. Paper currency and notes rely entirely on credit. For the Zhao Camp system, this credit was not a concern, at least not in the eastern part of Southern Zhili north of the Yangtze.

By now, Zhou Xuezhi was somewhat beside himself. What he had come to discuss with Zhao Jin tonight was merely how to activate the large sums of gold and silver stored in the vault to earn interest, but he had never expected to hear these words from Zhao Jin. Zhao Jin had not spoken in great detail, yet even these not-so-detailed words had lifted a small corner of the curtain, and the dazzling golden light revealed by that lifted corner had already deeply shaken Zhou Xuezhi, making him dizzy and lightheaded.

During their conversation, the need to respond and think had allowed him to maintain a sliver of clarity. But in the silence, Zhou Xuezhi felt countless thoughts surging in his mind. He seemed to see an inconceivable prospect, a prospect that made it impossible for him to calm down. Beneath that corner of the curtain, there seemed to be a mountain of gold...

"My lord, my lord, please wait just a moment. I must first write these down," Zhou Xuezhi said in a trembling voice. By this point, he no longer cared for propriety. After speaking, without even waiting for Zhao Jin's consent, he directly took out paper and brush and began to record.

His voice trembled, his body trembled, and as he wrote, he said, "My lord, now every year, spring and autumn are the hottest times for lending. If we do this, it won't be long before we can grasp all the money and grain of Southern Zhili in our hands. Whether collecting grain or selling grain, they'll all have to use our family's silver. By then, by then..."

When he reached this point, Zhou Xuezhi's expression even showed some fear. Southern Zhili was one of the Great Ming's grain-producing regions and its wealthiest area. If they could reach that stage, then what would the Zhao Camp be? Zhou Xuezhi had thought he had grasped this, but now that it truly seemed within reach, he dared not think further.

At this moment, Zhao Jin indeed appeared far more mature than Zhou Xuezhi. He merely smiled and said, "Proceed gradually. Right now, we can't even find enough personnel to open branch shops. A money house or exchange firm is still far off."

At these words, Zhou Xuezhi finally calmed down considerably. He let out a long breath and said, "My lord is right. We don't lack men who can fight and kill now; what we lack are men who can write, keep accounts, and work steadily. But 'money house' and 'exchange firm' are truly excellent names. Circulating, lending, and earning interest—isn't that just doing business with silver? Let's call it Cloud Mountain Money House."

Zhao Jin coughed twice, thinking to himself, could it be that the terms 'money house' and 'exchange firm' don't exist yet? It was fortunate he hadn't uttered the word 'bank.' On second thought, it seemed the word 'bank' might be even more fitting...

For Zhao Jin, this was merely an ordinary conversation, but for Zhou Xuezhi, it was anything but. He was even unwilling to stay here any longer, taking his leave hurriedly, wanting to go back and digest everything Zhao Jin had said.

After talking so much, the next thing to do was to rest for a while, or perhaps go take a look at the Qingjiang Great Market. But at that moment, Liu Yong arrived. The other brothers were all permanently stationed in specific places; only Zhao Jin had to tour and inspect, with Ji Xiang accompanying him. Liu Yong's Internal Guard unit, however, was highly independent and also needed to operate covertly. Liu Yong spent his days rushing between Xuzhou and Qingjiangpu, while Lei Cai went to certain places to oversee certain matters. The two had their respective duties, but when Zhao Jin came, everyone was still accustomed to reporting. After all, having Zhao Jin make decisions on some matters made a difference.

"Big Brother, I have a presumptuous thing to say, but I'm not sure if I should," Liu Yong began by apologizing in advance.

Zhao Jin frowned and smiled, saying, "We're brothers; what's there to be presumptuous about? Just speak."

"Big Brother, although we've combed through the Smelling Incense Sect time and again, I still feel we haven't rooted them out completely. Zheng Quan came from an incense-head background. It's true he's diligent, but his ability is very poor. I was thinking, since they were originally followers of Sister Lan's family, why not let Sister Lan take charge? Sister Lan has already built a considerable position within the Smelling Incense Sect in Dongchang Prefecture. Letting her comb through the Smelling Incense Sect's hidden agents and secret lines would certainly be more effective than now," Liu Yong said. He had called it presumptuous, but he spoke without any concealment; it seemed he had long had a plan in mind.

Upon hearing this, Zhao Jin merely sighed and said helplessly, "Let Little Lan take it slow for a while. She seems composed, but in reality, she hasn't recovered yet. Don't rush her into doing things just yet."

Liu Yong nodded and said no more. The two moved on to other topics. Zhao Jin did not fully understand Mu Shulan's state of mind, but Xu Zhenzhen saw it very clearly. Although Mu Shulan always chatted and laughed with perfect composure, after entering the Zhao household, she never took a single step outside the inner residence. When Zhao Jin was away, she was either by He Cuihua's side or accompanying Xu Zhenzhen. Mu Shulan was still afraid. The sudden calamity in Linqing had impacted her too greatly. The reason she appeared to be doing well was merely that she had learned some skills of concealment over the past few years.

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