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Text Chapter 206 The Prelude to the World Economic Crisis

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    Anyone who wants to get rich should buy stocks. This was the slogan of all Americans before October 1929. The craziness of the American stock market was far twice as crazy as when former Chinese President Li Changgeng came to China. During this period, there were many people who badmouthed the United States.  The stock market, but the result of every pessimism is the indomitable rise of the U.S. stock market.  [ At this time, the U.S. stock market is like a train that has lost its brakes. No one can stop its progress unless it collides with another train. This is a sentence from the New York Times.  Such an explicit statement did not attract the attention of Americans, who were already dazzled by the wildly rising stock market.  In fact, not everyone is confused, half of them are still aware of the abnormal rise in the US stock market, but it is like a stupid game, no one believes that they are the stupidest person.  Time came to the third week of 1929, the last day of the stock market. The stock price of the New York Stock Exchange fell like an avalanche. People sold their stocks hysterically, and the entire exchange hall echoed with desperate shouts.  This day became the dreaded "Black Thursday" and triggered the US economic crisis.  However, this was only the first day. On the following 29th, the stock price of the exchange plummeted again.  More than 16 million stocks were sold in one day, and the average price of 50 major stocks fell by nearly 40%.  Overnight, the "prosperity" scene disappeared, and a comprehensive financial crisis ensued: a large number of banks failed, companies went bankrupt, the market was depressed, and production dropped sharply; the number of unemployed people surged, and people's living standards plummeted; the prices of agricultural products fell, and many people  The verge of bankruptcy.  An economic crisis of unprecedented scale finally broke out, and the "Great Depression" period in American history arrived.  After receiving this news, the government of the Republic of China, which is thousands of miles away from the United States, urgently introduced a policy of switching from foreign trade to domestic consumption, which means that bulk exports of goods will be stopped from overseas exports, the country will refund export tariffs, and pay part of the inventory subsidy.  All exported goods will be converted into domestic consumption.  Immediately afterwards, the Republic of China government borrowed the first batch of financial loans of US$100 million from the United States. The loan mortgage was a series of fixed assets of US listed companies predetermined by the Chinese government.  The Americans know that they will definitely suffer from the Chinese losses, but they seem to have no better choice, because at the same time, Germany, the United Kingdom, France, Japan, Italy, and other powerful countries have seen their stock markets plummet one after another.  Except for those colonial countries in the world, only China and Soviet Russia have not been affected by this world economic crisis.  Needless to say, Soviet Russia, most countries in the world are sanctioning him, and only China and Germany are doing barter business with him.  In addition, Soviet Russia adopted a virtual currency system and had little purchasing power internationally.  The real economy is all controlled by the state, so there is no such thing as an economic crisis in a planned economy.  The countries most severely affected by the world financial crisis besides the United States are Germany and Japan. The situation in Japan is quite similar to that of Germany.  Although Japan is a victorious country, its industrial capabilities are very weak and cannot withstand the industrial blows of the United States and Europe.  Just after the First World War, the economies of Britain, France, Germany and other countries had not yet recovered. Japan received a large number of orders from American industries. Silk fabrics and ships were exported to the United States in large quantities, and the economy was once prosperous.  But then.  A large number of goods from European and American countries are flooding into Japan and Asian markets, and Japanese goods are losing ground, leading to an unprecedentedly severe economic crisis.  From 1920 to 1921, Japan's total industrial output fell by 19.9%.  Among them, 88.2% are shipbuilding, 55.9% mining, 55.9% machine manufacturing, and 16.7% pig iron.  Prices of major industrial products fell by 55%-82%.  Exports fell by 40.3%.  The balance of payments deficit reached 350 million yen, and foreign exchange reserves decreased from 1.3 billion yen to 600 million yen.  In fact, due to Japan's lack of international competitiveness.  From 1920 to 1929, Japan's trade deficit reached 3.3 billion yen.  Agriculture is not immune.  3,500 silk reeling factories stopped working, and 2 million silkworm farmers were in dire straits.  At the same time, a large amount of cheap international grain was imported into Japan, and the domestic market was depressed, causing grain prices to fall again and again.  Since then, rice and wheat production has stagnated for a long time.  On September 1, 1923, the Great Kanto Earthquake occurred in Japan. Most of the buildings in Tokyo and Yokohama were destroyed, and property losses amounted to 10 billion yen. This made the Japanese economy, which was already in a deep depression, even worse.  After the earthquake, from 1923 to 1927, the Japanese government borrowed huge foreign debt from the United States, Britain and other countries, amounting to US$910 million.  Relying on borrowed money and reserves obtained during the war, the Japanese government issued relief loans of up to 1.3 billion yen to major domestic consortiums. In this way, the Japanese economy gradually emerged from depression and entered a period of slow development.  But in 1927, another financial crisis broke out in Japan.  Some banks had a large amount of unorganized earthquake-disaster bills and had insufficient liquidity, causing a run on them.  Economic crisis and depression followed.  The government allocated a total of 1.2 billion yen to rescue major banks such as Mitsui and Mitsubishi.  Before Japan could catch its breath, a bigger crisis erupted from the United States.  This process produced two far-reaching consequences. First, it owed huge international debts and became an important link in the international debt chain that caused the Great Depression.  Second, a large number of small and medium-sized enterprises went bankrupt and Japanese industry was highly monopolized.  The Japanese economy controlled by monopoly consortiums imposes technological updates on the one hand, and actualization on the other.??Trade protection.  What is even more significant is that it contributed to the further growth of the political power to cancel debts and implement militarism.  From this perspective, the Great Kantš­ Earthquake meant to Japan what the defeat of World War I meant to Germany, and the huge debts of Germany and Japan were tied to the prosperity of the United States.  Germany paid huge reparations due to its failure in World War I. Until 1924, it still lost a large number of industrial and transportation facilities. German prices were out of control, and its financial and economic chaos was in chaos.  In 1924, the United Kingdom needed to maintain the balance of power on the European continent, and the United States needed to profit from Germany's industrial capabilities. Neither country wanted Germany to follow the footsteps of Russia and have a revolution. Therefore, the "Dawes Plan" was introduced, giving Germany 8  A loan of 100 million gold marks.  Encouraged by this plan, international capital continued to flow into Germany. From 1924 to 1929, the total foreign investment reached 32 billion gold marks, with American capital mainly followed by British capital.  During this period, due to the large amount of capital received and the small amount of compensation paid, German industrial equipment was generally updated, and the level of production technology jumped to the forefront of the world.  Not only that, most of the recipients of foreign capital are powerful German monopoly industrial groups.  This further strengthened the monopoly of German industry.  Thyssen, Krupp, Siemens, Mannesmann, Flick, etc. are stronger than before.  However, as a country, Germany was deeply in debt and had to pay massive reparations.  Although industrial production capacity has been restored quickly, people's lives are still very difficult.  As long as Germany postpones debt repayments and compensation payments out of the need to stabilize its political situation, or profits from investments in Germany cannot be realized, the international economic cycle will be immediately interrupted.  The country that will be least affected by this crisis is China, which has shifted its national economy from an export-oriented to an inward-oriented economy ahead of schedule.  Although export trade has been affected to a certain extent, due to the massive increase in domestic demand, most commodities have been self-consumed by the huge domestic population market.  In particular, with the successive start of a series of national projects, the demand for commodities such as steel and cement has even exceeded before the crisis.  In order to avoid falling prices of international agricultural products, China has also reduced the amount of grain purchased from abroad.  The most important thing to add is that although China has a lot of foreign debt, most of it is relatively healthy gold foreign debt.  This kind of foreign debt itself has a certain gambling nature. What everyone is betting on is the failure of China's inward-looking economic strategy.  Unfortunately, with the advent of this world economy.  China has become the big winner in this international gamble.  Moreover, as Britain and the United States successively loosened their gold standard currency systems, the Chinese dollar became increasingly popular internationally.  Of course, this is still a long way from becoming a world currency like the US dollar.  There is another country that is relatively less affected by this economic crisis, and that is France.  The French economy is relatively independent.  It has neither large claims on Germany nor corresponding exports of industrial equipment.  France's prosperity in the 1920s mainly relied on German reparations to provide capital to expand production.  Rely on low-priced francs to expand exports.  Therefore, when the US economic crisis broke out, France was still at the peak of its prosperity.  So the slow French did not adopt the Chinese approach to turn their export-oriented economy into an inward-oriented economy.  Or, like the UK, build trade protection barriers.  Of course, in general, the French people were still living a very happy life at this time.  To summarize, the approximate sequence of this world economic crisis is as follows.  October 24, 1929.  New York stocks plummeted.  After the New York stock market plummeted, the U.S. economy fell into crisis.  The United States withdrew a large amount of investment in Germany, and the German economy collapsed.  The UK also has significant investments in Germany.  The British stock market collapsed and the British economy fell into crisis.  The French economy is relatively independent, but it cannot get rid of its dependence on the international market, so it is relatively lucky to be injured.  Japan, Italy, and Latin American countries are the unlucky ones whose small boats cannot withstand the big waves.  Of course, the most excited about the outbreak of this world economic crisis is Li Changgeng, the President of the Republic of China, who is secretly having fun hiding in the Daming Palace.  Because this crisis proved to him the inertia of historical development.  And he will use this crisis to maximize China's interests.  The US$100 million previously loaned to the United States has now become equipment for major American factories and companies, and is being packed and shipped to China.  China, which has maintained good relations with Germany over the years, is now extending a hand of friendship to Germany. A plan to receive 5,000 German technicians to work in China is being launched.  As long as this gap is opened, there will be at least 200,000 technical job vacancies in China in the future.  In order to repay various debts, Germany had to sell newly updated machines to China, because the price offered by China was the most reasonable.  Of course this is only one third of the original price of these brand new machines.  China's relations with Latin American countries in recent years cannot be said to be good or bad. Most of them involve trade in grain-related products. Since the relationship is average, there is no need to be too polite. China has suddenly stopped importing grain from these countries.  The contract left China as a big customer, making the fragile Latin American economy feel like glass, with the cup shattered.?.  Li Changgeng, who did not care about the life or death of the Latin American people, turned this order to the United States, because at this time Li Changgeng wanted to help his good friend Mr. Hoover.  Of course, this is not a free move. China has a large number of assets in the United States that have not yet been transferred out, which requires the support of the U.S. government.  Especially for things that are in short supply like gold and silver.  There are also some relatively sensitive good things, such as 10,000-ton vertical extruders and 10,000-ton or above ferrous metal vertical extruders, which are mainly used to manufacture large-diameter thick-walled seamless steel pipes that are urgently needed in large power stations and the petrochemical industry; they belong to the world  The extreme field of advanced manufacturing technology is a symbol of a country's manufacturing capabilities and involves many problems such as design, manufacturing, transportation, and installation.  This stuff has always been played by the American company Weiman Gordon.  China also worked on this thing when it cooperated with Germany, but the effect has never been very satisfactory, and it was stuck at the level of less than 5,000 tons.  Let¡¯s put it this way, this thing mainly produces large-size thick-walled seamless steel pipes.  It may sound useless to everyone.  But with this thing, China can produce cannons with a caliber of 460 mm and a barrel of 55 times.  With this thing, China can produce the main shaft of a 100,000-ton giant ship.  With this thing, China can produce drill pipes that can drill oil deeper.  With this thing, China will be able to produce thermal generators with greater power generation.  This thing is not too difficult in theory, but the difficulty lies in the matching machines and operating techniques.  It's not easy for China to get this thing from the United States. If it doesn't build a good relationship with the Americans, the Americans would rather let this thing sit there and pawn it for iron than sell it.  Of course, this thing cannot be said to be for sale now, because it has been used as collateral for Chinese loans and now belongs to the Chinese. However, the Americans can easily find a way to prevent this thing from being shipped out of American ports.  Of course, the relationship between China and the United States is so good now.  We should not embarrass the Chinese people, especially when the Chinese people now have a lot of money.  At this time, China is purchasing a large amount of machinery in the United States and Germany. Naturally, it is impossible to buy all of it in its own hands, because this will severely damage China's machinery manufacturing industry. China will only retain those machines that are useful to China; China will take advantage of this  Opportunities have made China a country with a complete industrial system in one fell swoop.  As for the surplus machine products, China has a good buyer, and that is Soviet Russia.  In recent years, Soviet Russia has done very well under the leadership of Comrade Joseph. In 1928, Comrade Joseph.  It rejected Lenin's economic policies, followed China's example in carrying out five-year plans, and devoted all its efforts to industrialization.  Since Soviet Russia now has nothing of value to trade with China, it is the representative of Soviet Russia who came to China to negotiate.  I was so anxious that my hair almost fell out, but I still couldn't think of any good solution.  Why exchange food for food? Please, Americans now pour milk into the river and throw away wheat like sand.  A sheep sells for one dollar.  How could Russia offer a price lower than this?  Exchanging minerals is fine, but isn't Soviet Russia always exchanging minerals?  We are still five years away from producing enough minerals. Could it be that Russia has found some big mine?  It is possible to exchange land for machines, but the Soviet-Russian negotiators still want to keep their heads above water, so this condition does not need to be met.  So after the various efforts of the Chinese negotiators, the Soviet negotiators finally said, "This will not work, and that will not work, then we will only have people left." The Chinese representatives immediately laughed, and people  We need, we not only need high-level talents, we also need some hard-working talents, such as miners whose work is very dangerous.  Now that the conditions of the Chinese people have improved, no one is willing to work in the mines. If the Soviet Union can provide corresponding labor force, then China is very willing to accept it.  After the Chinese representative¡¯s detailed explanation, the Soviet and Russian representative finally understood what China wanted. What China wanted was not the hard-working workers they said, but a group of slaves who did not have to pay wages.  The Russian negotiators are very upset about China's unreality. If you have such an idea, please tell us earlier!  Now there are so many bad elements who oppose Joseph's establishment of collective farms that the prison has long been unable to contain them.  Keeping these people is a waste of food, but in exchange for it, China can get the industrial equipment that the country urgently needs.  So an extremely dirty deal was concluded in secret.  In the extreme cold areas of Siberia in the Far East, there are extraordinary natural resources, but the difficulty of developing these resources is not ordinary. The Chinese are not willing to work in these places.  But these are still bearable for the Russian body.  As a result, slave farms similar to concentration camps appeared in desolate Siberia.  These slave factories were concealed as being built under the cover of Soviet Russia investing in a mining company in China.  This transaction lasted for ten years, and Soviet Russia provided no less than half a million slaves to China.  These people have made positive contributions to China's development of northern Siberia and the Far East.  Of course, when China repatriated these slaves, less than 100,000 people returned to Soviet Russia.  And the price the Chinese paid for this was some extremely low pricesindustrial machines.  This is also the focus of debate among many historians in later generations, because many mass graves were discovered in these places. Some scholars believe that this was a crime committed by China and the Soviet Union, and it was against humanity. China and Russia should pay compensation for this.  Some scholars argue that China only hired labor companies from Soviet Russia.  Moreover, China also paid the monetary price. This inhumane behavior was only a unilateral matter of Soviet Russia.  (To be continued)
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