553: Chapter 553: Firmly Stabilizing the Market 553: Chapter 553: Firmly Stabilizing the Market Early this morning, markets everywhere were in an uproar.
The reason was simple, as a new tax law had been enacted today.
The current taxation allowed the use of standard foreign gold and silver currency for payment, which initially pleased some people.
But then they discovered that the exchange rates had changed.
Because to pay the taxes, one could only use Gold Coins, and Zhao Guang wouldn’t accept any other currencies.
Of course, that was one thing, but the real issue was the value.
To pay with foreign currency, one had to use fifty times the domestic currency’s value to pay the tax, which was quite exaggerated.
Outside, the exchange rate between the domestic and foreign currencies was already in the range of thirty to fifty times.
Qiao Miya had long since investigated and hence directly used the highest rate.
Now, anyone hoping for an advantage was in panic.
According to this ratio, most of them would lose money.
They could not have foreseen the Xuanwu Territory suddenly doing this.
Even for the few who could manage to trade at fifty times the cost, they would still lose out when factoring in transportation costs.
“We protest, this is a plundering of our wealth, an immoral deed,” they cried.
“Heh, if you’re reluctant to pay your taxes this way, you can also use our own territory’s currency, which is valued normally,” said the person in charge, sneering at them.
“But we don’t have domestic currency; the issuance is too low,” they complained.
That person’s smile grew colder: “Issuance too low?
Stop talking nonsense.
Our Lord issues currency based on the market’s capacity to absorb it, which is already more than tripled.
Although the merchants didn’t understand what ‘market capacity’ meant, they realized that there was not a shortage of currency.
In fact, how could they not know?
The amount of currency they had transferred out during this time was substantial.
Indeed, there was plenty circulating within the Xuanwu Territory.
Hadn’t they seen many people in the Xuanwu Territory becoming quite wealthy?
This wealth referred to currency, not anything else they held in their hands.
In fact, after some had made a fortune, they entertained leaving the Xuanwu Territory.
It was unavoidable; the constant rise in prices here made other places more attractive for their wealth to stretch further.
This is practically killing us; how can we do business ?” some began to protest loudly, and more and more people joined.
However, before the situation could escalate, they suddenly saw the army moving in.
“You, what are you doing, can’t we even speak now?”
“How laughable, would you dare insult the Lord in any other territory?
Wantonly slandering the Lord— that is a grave crime.
Take them away!” The person in charge waved his hand and the military, fierce like wolves and tigers, detained all the troublemakers.
None of them had anticipated things escalating to this extent.
At that moment, they finally realized that no matter how gentle the Lord of the Xuanwu Territory was or how short its development time had been, he was still a Lord, and moreover, one immensely powerful and capable.
They had been granted a relaxed environment for the territory’s development.
But once their actions affected that development, the Lord’s authority naturally manifested.
Most people instantly regretted their actions but by then it was too late.
Whether it was apologies or whatever else, they were all arrested and awaited isolation and investigation.
The people around whispered among themselves, but it did not cause much commotion.
Zhao Guang soon realized that after all these people were refugees, not long arrived.
His territory had provided them refuge and the means and environment to live; they were very grateful to him.
If they were to turn sour, it would at least take some time.
Now, with a constant stream of refugees entering his territory, their mentality had not yet shifted.
Upon seeing someone target the Lord, their instinct was not to see a fault in the Lord, but in those people.
Originally, Zhao Guang had prepared for the possibility of suppressing these people with military force, but now it seemed unnecessary.
“Thank goodness, the outcome turned out to be much better than expected.
After this, these people should quiet down a bit.
Still, I need to address the currency issue, as its low value is a problem.”
The root of this incident was the high actual value of the currency he had introduced.
As the face value of the currency was too low compared to its real value, the moment it intersected with the external market, it became akin to a special commodity.
If he couldn’t solve this problem, endless issues were bound to follow.
Zhao Guang knew that he had only resolved the superficial problems but the root still remained.
As long as there were profits, and hefty ones at that, people would certainly take risks.
After all, the movement of currency in and out was normal and hard to track.
And with each transport, they were looking at profits of thirty to fifty times.
If one could go further, the profits could be even higher.
Therefore, suppressing the value with similar high-level currencies was of utmost importance.
While future problems were inevitable, at least they would not be as significant.
True large-scale trade would still require using high-denomination currencies, after all.
After giving instructions, Zhao Guang returned to Earth to find his brother-in-law.
Wang Qu was now extremely busy with an overwhelming number of weapon orders.
Certainly, what they wanted was a high-fidelity replication, one of quality in its own right.
They were blunted, of course; if they needed to be sharpened, they’d find a way themselves.
Everyone knew that blunted objects were considered handcrafts, but once sharpened, they turned into controlled blades.
Though there had been calls to deregulate this at the national level, seeing the chaos it caused in some places, the authorities were hesitant to do so lightly.
These were not guns, but they were lethal tools nonetheless.
The current government stance was to wait and see, allowing the trade of handcrafts under certain regulations.
Online purchases were all made under real-name systems, so it proved much easier to regulate.
“Seeing how busy you are, I’m a bit embarrassed to ask for more orders.”
“Just give your instructions freely; you’re the major shareholder of the prop factory.
But if it’s about weapons, I really have no capacity left.
I know plenty of others who’d like to get into the business though.
I could refer them to you, considering you’re not looking for branded items.”