At that time, the national government was keen on civil war, with huge military expenditure and continuous fiscal deficit. After the outbreak of War of Resistance against Japanese Aggression, the fiscal deficit became more serious. 1937 deficit accounted for 73.27% of fiscal expenditure, and it rose to 74.36% in 194 1 year and 76. 1 1%,1. During the War of Liberation, the national government's military expenditure reached astronomical figures. The fiscal deficit for many years had to be made up by issuing paper money (legal tender), which led to the exhaustion of foreign exchange reserves and gold reserves, soaring prices, waning days and hyperinflation. 1948, in order to stop inflation and get rid of the economic opportunity, the national government carried out "currency reform". The devaluation of gold certificates issued is faster than that of legal tender, the exchange rate between prices and the US dollar has soared like a rocket, and the black market of foreign exchange is rampant. 1end of 948, doubled every other month,1end of 949, 65438+. At that time, according to the price statistics, someone made an intuitive analysis of the depreciation of legal tender and gold certificates: the purchasing power of legal tender is 100 yuan, 1937 is worth two scalpers, 1938 is worth a scalper, 1939 is worth a pig, and194. 1948 rice is 0.0024 16 Liang, 1949 may rice is 0.0000000 185 Liang, that is, 2.45 thousandths of a grain of rice. Legal tender has completely collapsed, and such serious inflation is rare in the world.