A netizen has just uncovered a video from ten years ago that talked about the financial game after the Sino-Japanese War of 1894-1899. I had written a related article on this issue earlier, and now I am posting the article here again. Let everyone see more details and arguments. This helps everyone understand the real game in the world and understand the power of financial war. This article was first published on Tianya. The ID is: No one can comment on who is who, but after Tianya blocked me, no one will be able to see this article.

The great powers supported Japan in the Sino-Japanese War of 1898-1899. After China’s defeat, we generally thought that Japan made a fortune, but what we did not expect was that the real profits behind the scenes were international financial capital and the world’s great powers. Through financial and monetary aggression, we have obtained benefits beyond our imagination.

China and Japan signed the Treaty of Shimonoseki, which was humiliating and humiliating. The Qing Dynasty paid 200 million taels of compensation to Japan and the island of Taiwan. These huge compensations were repaid by borrowing from a group of banks from Britain, Germany, France, Russia and other countries. In the end The total principal and interest is as high as 600 million taels. The specific situation is: In order to pay off the compensation within three years in accordance with the treaty, the Qing government signed the "Four-cent Loan Contract" with Russia and France in July 1895, which was a "Russian-French Loan", with a total loan of 400 million francs. , with an annual interest rate of 4% and repayment in 36 years, with a discount of 94.125%. In March 1896, the Chinese government signed a loan contract with Britain and Germany, known as the "British-German Loan", with a total loan amount of 16 million pounds, an annual interest of 5%, and repayment in 36 years, with a September 4th discount. In March 1898, the Chinese government once again signed a loan contract with Britain and Germany, namely the "Extension of the Anglo-German Loan". The total loan amount was 16 million pounds, with a discount of 83%, an annual interest of 4.5%, and repayment in 45 years. According to calculations, the estimated indirect losses caused to China by the above three loans alone amounted to 404.71 million taels. At the same time, these loans also included harsh additional conditions that further caused China to lose its sovereignty. The relevant conditions are as follows:

< p> 1. Within the 45-year repayment period, the Chinese government is not allowed to accelerate repayment or pay off the repayment in advance, nor is it allowed to change the repayment method;

2. "When this loan is not repaid, the Chinese Prime Minister's customs affairs shall be handled according to the advanced handling method" (that is, the position of the Customs and Taxation Department has always been filled by British people);

3. In addition to customs duties, the scope of loan guarantees also included goods and salt. Hart took this opportunity to ask the neutral yamen to hand over the relevant bureaus to the jurisdiction of the General Taxation Department, which greatly expanded the power of the General Taxation Department.

These conditions ensured the collection of interest and strengthened the control of China's income. The interest and incidental benefits, which were nearly twice the amount of compensation, were obtained by international financial capital. The profits of international financial capital exceeded that of Japan's war. However, Japan's war gains were mostly from repaying foreign debt to international capital and purchasing arms from the great powers again. Most of the benefits still flowed into the pockets of the great powers and predators.

The greater benefit is the financial and currency war that followed, which forced China's silver to depreciate. The great powers conspired with Japan to "receive 230 million taels of silver from China in April 1895." The "Sino-Japanese War of 1894" indemnity forced China to pay in pounds sterling, which forced China to sell silver in exchange for pounds sterling. Two countries that both used silver had to pay in pounds sterling. From this, we can see the presence of great powers. When the tariffs agreed between China and the great powers were formulated in early 1843 and revised in 1858, the special silver taels used to calculate tax rates and pay tariffs - customs taels, actually remained at six shillings eight per two pounds for pounds. The determined value of pennies or three ounces to one pound is actually a fixed exchange rate system between Chinese silver (treasury silver) and pounds. You must know that the repayment and guarantee of China's foreign debt are all customs duties. This fixed exchange rate system was broken due to the run on Japan's war reparations. According to a memorandum issued by the Customs and Excise Department to various countries in 1896, Hurd pointed out that "the exchange rate of silver against the pound has been constantly depreciated, so that at present, it takes six to seven taels to buy one pound of British currency." This document lets us see What happened was that China's silver depreciated to half of its original value, and the great powers used customs duties to pay taxes, which reduced their taxes by half. This was the actual bankruptcy of China's fixed exchange rate system with customs duties as the core.

From three taels of silver to one pound to six or seventy taels of silver to one pound, this depreciation is the depreciation of the resource-based precious metal currency against the paper currency that relies on bonds. It is opposite to the effect of the current depreciation of the US dollar. Our silver outflow and resource outflow have intensified, and our silver outflow has caused greater currency deflation, and China's economic development has been completely strangled.

Such a huge depreciation will inevitably cause greater losses to China. The immediate loss is that we will have huge exchange losses in returning the loans we borrowed from the great powers and financial capital after the Treaty of Shimonoseki. This is called pound loss in history. The international financial capital has extremely huge interests in manipulating the price ratio of gold and silver, as well as the exchange of British pound banknotes for China's real silver. Not to mention these indirect financial benefits, the customs tax revenue and our trade losses will be huge after the devaluation. The total tax revenue of China Customs continued to increase under Hart, from 8.3 million taels in 1865 to 12 million taels in 1875. , and increased to 14.5 million taels in 1885. In 1887, the import of foreign goods exceeded 100 million customs taels. By 1894, it had rapidly risen to 162 million customs taels in seven years. The total of all these losses is definitely not 230 million taels of silver, nor is it 600 million taels of silver with interest, but a loss of more than one billion to several billion taels of silver. The great powers and international financial capital return home with huge profits. Therefore, when we look at China’s modern history, we should not always focus on the compensation paid by China for each defeat. All the compensation paid together is not as large as the wealth of corrupt officials and gentry alone. China’s losses It lies in the loss of finance and resources. At that time, silver was a resource!

The loss of China’s resources is the key to China’s gradual decline into a poor country struggling to survive. The main means of such exodus is not the military, but trade, finance, and currency. Economic means have played an important role in China’s history. People's plunder must go beyond military means. We cannot always focus on military and war and ignore finance and currency. The economic theories of the Western powers here are more advanced than the Western military weapons. We had no economic theory at all at that time, and China's history of learning from the West was more about learning their production technology, military weapons, etc. It is not an economic theory. Our traditional Confucianism cannot compete with Western economic and financial theories. We do not have a deep understanding of the impact of these economic theories. The earliest overseas students in China basically studied technology rather than economics. Western economics The theory's profound understanding of resources and resource mercantilism have brought them huge economic benefits. However, China has not yet had a deep understanding of such interest differences and economic aggression in history. Few Chinese historians understand finance. , otherwise those orthodox scholars who especially love to argue that China’s failure was the result of a joint strangulation by Chinese and foreign reactionaries will definitely write this point into history textbooks.

The depreciation of China's silver has forced China's trade to surge, mainly in the import of necessities, causing China's serious overvaluation. According to statistics, in the ten years before the war, China's average annual import and export volume was only more than 226 million customs taels, of which the import volume was only more than 126 million customs taels, and the export volume was only 99,000. More than 1.6 million customs fees. After the First Sino-Japanese War, according to statistics from 1898 to 1913, China's average annual import and export volume increased to more than 600 million customs taels, and the export volume was more than 251 million customs taels.

Regarding the needs of China's self-sufficient agricultural society, foreign purchases are basically rigid needs. What we import are foreign goods, opium and other rigid needs. The import volume will not change greatly with the exchange rate. It exceeds 200 million customs taels. The increase in import trade volume is basically the result of the depreciation of silver. To meet its rigid demand, China spends more than 200 million taels of silver every year for no reason. When purchasing our products from abroad, the same money can buy twice as much. Things, the export volume of more than 200 million can buy you 200 million more materials and resources. The total total is more than 400 million taels, that is, two Shimonoseki Treaty compensations are paid out every year, or every year A Xinchou Treaty indemnity came out, which was equivalent to 1 tael of silver per Chinese per year. For China's society with a per capita income of about 3 taels at that time, it was equivalent to a tax rate of 33%, which was comparable to the original 5% of the Qing government. Plus, reaching nearly 40%. The difference here with government taxes is that these losses are the meat rotting outside the pot. Even if the government tax revenue is corrupted, it is consumed in the domestic society. It is the meat rotting in the pot and still being harvested by the Chinese. Transformed into new wealth, while the outflow of resources is the transfer of wealth to other countries. Such losses every year will soon exhaust China's historical wealth. Such losses are much more terrible than war, and will remove China from the world. The number one rich country has been defeated. From here we can see that Western powers and financial capital supported Japan's war against China, launched a financial war with the help of military war, and the extent to which their financial and currency war plundered profits from China. China leads the world. You can imagine how the wealth accumulated over thousands of years was leaked to the West and how it was plundered by the foreign powers. You must know that the total amount of war compensation in China is still less than the 900 million taels of silver wealth gained by He Shen's house when he was confiscated. With China's The accumulation of historical wealth and war reparations alone cannot replace China's economic foundation. The plunder of financial and monetary resources is the key to the problem. Therefore, Japan’s Sino-Japanese War of 1898-1895 was a total military, financial, and currency war in which Japan used military power as a means and the financial and currency war between the great powers and international financial capital as its essence. What China lost to Japan was not just a small emerging country. , but the powerful global forces behind it. With China's decline at that time, it was already foreseen that China would be involved in such a war for global profit. The result would be a disastrous defeat.

Many foreigners here are brainwashing the Chinese to cover up their financial and currency resource plunder, saying that China’s silver devaluation was caused by the discovery of a large number of silver mines in the Americas and the surge in silver mining. Therefore It is normal for silver to depreciate, and historical data are also available to tell how much of the silver in circulation in China is Mexican Eagle Ocean. But we also need to see the essence of the problem: China's massive inflow of silver occurred many years before the Opium War. Due to the inflow of foreign silver, China's prices were indeed much higher than those in the Ming Dynasty. Silver in the Qing Dynasty was not as valuable as that in the Ming Dynasty. , but before the start of the Opium War, silver was flowing out of China, so there was a smoking ban and the Opium War. After the Opium War, China's silver outflow accelerated, and it did not change until Tongguang ZTE, but it was incomparable with the original outflow. , so China’s silver was generally a net outflow at the end of the Qing Dynasty. How could such a silver outflow result in an excessive amount of silver and depreciation? Mexico's Eagle Ocean is only the inflow from the Americas to China, and does not include the outflow from China to Europe and the United States! There is another situation that everyone knows that needs to be considered, that is, not only a large amount of silver was discovered in the Americas, but a large amount of gold was also discovered in the Americas! For example, in San Francisco, Los Angeles and other places, the gold standard system of the pound is linked to gold, so when the gold discovered flows into the market, the pound should also depreciate! If we look at this problem from the perspective of actual purchasing power, it will be clearer. China's outflow of silver has caused deflation in China. The specific manifestation is a serious imbalance in the exchange price of silver and copper coins. We exchange 1,000 copper coins for one or two silver coins. The depreciation has reached more than 2,000 copper coins, and the highest value has reached more than 3,000 copper coins to exchange for one tael of silver. The purchasing power of silver in the country has increased sharply. Silver depreciates externally and appreciates internally. When calculated comprehensively, there is a gap of more than four times. The internal appreciation of silver is the most illustrative of the absurdity of the statement that such depreciation is caused by the flow of large amounts of silver discovered in the Americas into China. If factors such as changes in the actual purchasing power of silver are taken into account, the actual effectiveness of the more than 400 million taels of silver that the West plunders from China every year through financial and currency wars mentioned earlier in this article will be doubled! If measured by the original value of silver, materials worth 800 million taels of original silver were actually taken away.

The West also has a purpose in allowing China's reparations to be calculated in silver, because silver cannot be financially derived like paper money. After China's silver is outflowed in large quantities, it will inevitably cause domestic deflation. If they use silver again, they can exchange for more resources! After they obtained the silver, they sold it in large quantities in the international market, causing a greater depreciation of the silver price and the pound. However, China does not have a financial system and a central bank, and it does not have the ability to maintain silver prices in the international market. In this way, China is using silver to purchase You will have to pay a higher price when importing materials, and domestic deflation will become more serious, creating a vicious cycle. Just like the Asian financial crisis in 1998, the East Asian Tigers' more than 20 years of development achievements were wiped out in a few months. Such plunder in China lasted until the end of the Qing Dynasty. Over time, all the blood of China's wealth was drained away. .

When using real silver without any financial and monetary instruments, the imbalance of foreign trade is extremely terrifying, and it would be even more terrifying to use your real silver against the other party’s mature financial system with banknotes. Things, and the Sino-Japanese War of 1894-1895 forced China to have such a confrontation. The Opium War opened the customs door to China’s material trade, and the Sino-Japanese War of 1894-1894 opened the door to China’s financial market. This is what the great powers need most, because After China also grew its own opium, opium imports decreased significantly. Western powers once again discovered that China was about to enter the superpower. However, China's resources, silk and tea were necessities for the powers. Reversing this economic situation was no longer the beginning of the Opium War. The treaty ports can solve the problem by legalizing the opium trade. Therefore, the financial and currency war against China is necessary for the plundering of the powers. The real starting point of the Qing Dynasty's fiscal deficit was after the Sino-Japanese War of 1896. In 1896, the deficit reached 12.92 million taels of silver and in 1899 it was 13 million taels. Before that, China's foreign debt was very small. Hu Xueyan's foreign debt was incomparable to the borrowings after the Treaty of Shimonoseki. Before the Treaty of Shimonoseki, China was a self-sufficient society with no foreign debt, but after the Treaty of Shimonoseki, China was burdened with a heavy debt. With the burden of foreign debt, China no longer has any national borders that can be defended in the economic field. China faces the unanimous squeeze of the world's powers as a single country. How can China not decline? How can such a decline be solved through simple internal reforms? To become strong, China must find its own path.

For the silver obtained in China by the great powers, the West also went directly to China to conduct gold and silver arbitrage activities, because the price ratio of gold and silver in the West is 1:20, and in China it is about 1:10, and the profit space is Huge. Since the Chinese government does not use gold as currency and has no gold reserves, gold is more of an ornament in China, and the private sector does not have the scale, strength and ability to exchange gold and silver across oceans. Such gold and silver arbitrage is basically used by Western financial capital. Therefore, when they go to other parts of the world, such as the Inca, they have to pay for gold. They require China to pay silver instead of gold. The purpose is to earn the price difference between gold and silver, and the Chinese government is all silver due to taxation and so on. They are not willing to pay gold, and the arbitrage between them is so easy for international financial capital to earn. When there was no room for arbitrage in China's gold, the great powers asked China to pay in gold. On July 2, 1905, the great powers forced the Qing government to change the Boxer Indemnity calculated based on the silver price to The gold debt was repaid, and the compensation that had been paid in silver was converted into gold prices, and approximately 8,000,000 taels were compensated.

After the Treaty of Shimonoseki, the West’s loans to China at an interest rate of 5% may not seem high, but these interests are calculated on compound interest, which is very different from our today’s loans without compound interest, and you When the debt is repaid, the domestic silver will be taken away to cause deflation. As the repayment continues, the silver will become less and less, and this deflation will become more and more serious. Therefore, such interest will not be repaid with paper currency but with real silver, and the loan will flow out. In the economy, such a huge loan is fundamentally different from a small loan, because it will cause you to deflate. In the end, your burden will be greatly affected by deflation, which far exceeds the interest you pay, which is much worse than Nowadays, the interest rate increase after the mortgage of the house slaves is much harsher. This is a noose that is getting tighter and tighter, more sinister than the interest-sharing loan sharking in China. Such a noose of financial deflation has never been imagined by Chinese ministers.

This kind of silver deflation is also different from today's paper money model. Under the paper money model, huge loans will cause excess liquidity and cause inflation. Inflation will offset the interest and even cause actual negative interest rates. Therefore, today's major developed countries are vying to become debtor countries. In the era of metal currency, the creditor country is the grandfather. Of course, the prerequisite is that you also have the force to protect the creditor's rights.

The impact of such a financial attack on China can be understood by looking at the total amount of silver circulating in China at that time. According to He Liping's paper, in 1825, China's currency silver stock should be between 600 million taels and 1.1 billion. between two. 1825 From 1840 to 1840, China’s total foreign goods trade deficit, that is, the scale of the net outflow of silver, was about 40 million silver taels. Since then, China’s silver outflows and inflows have been basically balanced ("Reexamination of the Relationship between Opium Trade and Silver Outflow" He Liping Social Science Front, 2007 Issue 1). The reduction in monetary silver caused by the opium trade accounted for between 3.6% and 6.7% of China's monetary silver stock at that time. The outflow of only 40 million taels of silver has caused huge pressure on China, and the Treaty of Shimonoseki will give Japan 230 million taels. You can imagine what kind of pressure Bai Yin is under, and the subsequent compensation of 450 million taels is even more disastrous. As for the 900 million taels of property that He Shen confiscated from his family, more of which are antiques, calligraphy, paintings, and industrial real estate. Bai Yin only has a lot of value. to 30 million taels; and after the bankruptcy of the standard currencies of various countries after World War I, a large amount of silver flowed into China. In 1935, China issued banknotes and used legal currency to force the exchange of silver dollars (a silver dollar is about 0.7 taels of silver). China as a whole only received 1.4 billion yuan. Therefore, if such compensation is calculated in real silver, it is understandable what kind of disaster it will be for China's financial system and what kind of deflation it will cause. Such a reduction in silver currency cannot be made up for under the monetary system at that time, and it will have a negative impact on the national economy. You can also imagine what kind of impact it will have. At that time, most of the silver in the world was in China. With so much silver entering the world market, it is conceivable that the value of silver in the world market would depreciate.

The silver obtained by the West became their currency issuance reserve after China arbitraged it into gold, maintaining the rapid expansion of money supply under the gold standard system and promoting the economic prosperity of the West, while Japan established the gold standard The system was also established with the guarantee of pounds sterling obtained from the indemnity of the Treaty of Shimonoseki. Before this, China basically used precious metals such as silver and copper as currency. For a country with the world's largest GDP at that time, this meant how much wealth it meant. With such outflows, China also became a low-income country. There is a fact that modern Chinese history is unwilling to mention publicly, that is, the national fiscal revenue of our Republic of China was far lower than that of the late Qing Dynasty. Even if the tax rate in the late Qing Dynasty was only 5%, the total revenue of the imperial court was much higher than that of the Republic of China. After 2000, the government revenue, but the tax rate of the Republic of China was in line with the world or even higher. Here we can see the extent of China's actual decline. Therefore, many propagandists must put on the hat of exorbitant taxes and miscellaneous taxes in the late Qing Dynasty. A very serious hat.