| Wen Jiabao, the Chinese Premier, has rejected foreign pressure for an immediate shift in the country's money regime. He maintains that Beijing will set its own timing for reform and warned against what he called undue haste. In a speech he gave before Asian and European finance ministers, Wen said China would independently determine when and how reforms would be made in that country. He spoke a day after Japanese Finance Minister Sadakazu Tanigaki said it would be in China's interest to move quickly toward a more flexible money exchange rate system. China's money regime keeps the yuan's value fixed in a close range around 8.28 to the dollar. Many U.S. manufacturers contend that China's fixed currency system has undervalued the yuan by as much as 40 percent. This has had the effect of making Chinese products cheaper in the domestic market and American goods more expensive in China. China may not have heard much of show me the money phrase but they do take good care of their currency.
Money history: on denier, pounds and banknotes:
With the collapse of the great Rome, the monetary system of the conquered countries got shattered. In Britain, for example, circulation of coins was interrupted for more than two centuries, and when they reappeared, then initially they were used only as decoration. For a long time in Europe there was no significant progress in the evolution of money.
In 928 in England has adopted laws of Athelstan King, in which he proclaimed 240 sterlings, or silver pennies, in other words, pound as the single national currency. But for another 10 centuries, the Europeans will solve the same problems as the Romans millennia before did - control over the purity of the metal in the coins, the depreciation of old money, or unlimited minting of new ones to meet current needs. For example, at the end of X century to buy off the Dutch, the English King Ethelred Unreasonable rapped 40 million silver pennies, but it did not help. His great-nephew of William, Duke of Normand, used an old trick, and successfully devaluated Norman coins, which were in circulation, has financed the military company and conquered England in 1066.
Let us not cover in detail the events connected with the establishment of credit and financial systems, among which are – founding of Barcelona bank in 1401, the massive infusion of gold from South America, the adventure of Charles I. A fundamental contribution to their development has been made by a Swede, Johan Palmstruch, whose bank was the first in the western world on a permanent basis to produce paper money. However, as is often the case with talented trailblazers, Palmstruch and his bill encountered a sad fate. In 1668, after the decree of the devaluation of the bills was passed out, he was jailed, but the Swedish government withdrew all banknotes on suspicion of insecurity in precious metals, and then began to print their own paper money. But by the quality of performance and level of protection they conceded those printed by Palmstruch.
However, those days paper money of the modern form did not exist. Rather, those were the documents either confirming the right of the owner to dispose of a certain amount of money made of precious metals, held in bank or guaranteeing the right to receive a certain sum on presentation of a paper, some kind of promissory notes. It was widely believed that the appearance of paper means of payment is linked with the simplicity of their use – it is easier to store large amounts. But it is rather a consequence and not cause of appearance of the paper money. Just when Europe started growing rich, gold and silver were not enough for coinage, and as the way out to solve the problem was printing on paper – it has long been known, thus it was put into circulation. From mid XVII century IOUs were actively used as money. In 1659 we find the first British receipt instructing the London office of the goldsmiths - Clayton and Morris to pay to Mr. Delbou four hundred pounds. And in 1681 in one of the biggest colonies of New England - Massachusetts Bay – an authority, responsible for the constant release of notes, was formed. And in 1690 with the paper money issued by it, salaries of soldiers were disbursed. |
