Why did paper money finally collapse in the Ming Dynasty?

Paper money is the most common form in modern economy and monetary system. As we all know, the central bank issuing it must store a certain proportion of reserves in advance to prevent banks from going bankrupt due to insufficient liquidity when a large number of depositors withdraw bank deposits at the same time. Please always remember that the existence of reserves is a prerequisite for the normal operation of the monetary system. Without reserves, there is no strong credit guarantee for issuing currency.

At the same time, the operation of monetary policy must take into account the influence of prices in real life-a healthy economic environment is closely related to the circulation of money (here directly refers to paper money). Only stable low inflation will not have a negative impact on economic growth. There is also the end of spamming money, and the jokes about "golden coupons" and "Zimbabwe" toilet paper at home and abroad are vivid.

And our simple proletarian comrade Zhu Chongba obviously didn't understand these truths in those years. He saw that it was fun to issue paper money in the Yuan Dynasty, so he followed suit. According to his regulations: Daming paper money can be converted into 0.25 taels of gold, one tael of silver, or a thousand coppers at any time, or into one meter and one stone (note here that the value of Daming paper money is converted according to rare metal currency or rice. In other words, the real value of this kind of paper money is that there must be rare metal money or stored grain behind it as the guarantee of the value of paper money, that is, its reserve). Unfortunately, from the eighth year of Hongwu, when Daming Central Bank issued precious paper money to Zhu Yuanzhang's death in the thirty-first year of Hongwu, the annual circulation was as high as 510.5 million ingots of paper money, but behind it was that there was no ingot of gold and silver, a string of copper coins and a bag of rice in the treasury of the whole central bank to give paper money. The logic of the central bank is that if I print consistent banknotes, I can really be a silver flower and a stone rice. In this way, the original premise of paper money issuance, the credit system, was disintegrated by our comrade Zhu Chongba at the beginning of the birth of treasure money. Since paper money is not guaranteed, how many people dare to treat it as a treasure?

Moreover, I don't know if you have noticed the circulation of Daming paper money:-5 150000 ingots a year ... Boy, the Mongols only dared to issue 200,000 ingots when they were still alive in the Central Plains. A little out of control, soaring to 6.5438+0.5 million ingots, the whole social economy forced out a number of anti-thieves because of inflation. As a result, Daming Central Bank was generous. Look at others, the circulation of the Yuan Dynasty is not a fraction of it (in the 23rd year of Hongwu, the employees of the central bank directly increased the circulation to 654.38+0.5 million ingots). In addition, at that time, the regulation of the Ming government was that "all precious banknotes were only issued and not collected"-old banknotes were not recycled. Therefore, there were more and more banknotes circulating in the market at that time. Finally, it flooded and inflation developed indefinitely. We now have a little economic awareness of people all know that once too much paper money is circulated, it will depreciate accordingly. If the central bank happens to have no brains to work, it will increase its horsepower and continue to print more to make up for the quality. In the end, the vicious circle is not good, creating new toilet paper for public toilets. Hongwu thirty years, one or two silver can buy four stones of rice. But if you buy it with precious money, it will cost ten times as much. When I arrived at Xuanzong, the great grandson of Zhu Yuanzhang, I already needed to buy a banknote with a face value of 50; Ming Yingzong orthodox nine years, has soared to one hundred penetration. From then on, the value of Daming's treasure money is no longer limited to itself-if you change it into copper coins, you can always get no more than two coins.

The issuance of a banknote is neither supported by the reserve nor the corresponding inflation coping mechanism, otherwise it is a ghost. But then again, in the social environment in which farmers were severely bound by land, social mobility was difficult, and commerce was underdeveloped in the middle and early Ming Dynasty, it was really a devil's errand to use paper money as the mainstream currency. ...