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By Root 2990 0

and paper money grew to the point where desperate merchants took to carrying around little silver ingots, often shaped like shallow bowls one to four inches in diameter. When traders met, they used the ingots to buy and sell, weighing them with jewelers’ scales and clipping off needed sums with special shears; to evaluate the ingots’ purity, they used kanyinshi (silvermasters), who charged a fee for the evaluation and routinely cheated all parties. Awkward as it was, this system was better than using coins that might lose their value at any time. By the end of the wokou crisis, one writer complained in 1570, coins were used in fewer than one-tenth of all market transactions. The Chinese government didn’t issue the ingots; as if in a libertarian fantasy, the money supply was effectively privatized. Anybody who could lay hands on some silver could get kanyinshi to certify it—instant money! Everyone was paying bills with splinters of silver.

Grudgingly and gradually, the Ming emperors adopted this system, too. China’s basic tax system—farmers paid a portion of their harvest—hadn’t changed for eight hundred years. But over time it had become encrusted with loopholes and extra levies, which created opportunities for corruption. In a series of edicts, Beijing reordered the tax rolls and ordered the citizenry to pay an ever-increasing share of their taxes in raw silver, rather than in kind. By the 1570s, as the Wanli reign began, more than 90 percent of Beijing’s tax revenue arrived as lumps of shiny metal.

Called sycee, these small silver ingots were used in the Ming and Qing eras instead of coins. The stamps include the mark of the silversmith (difficult to read, but probably Shunxiang Smithy) and the date (the twentieth year of the Guangxu emperor’s reign, or 1895). (Photo credit 4.3)

China was the world’s biggest economy. Its “silverization” meant that tens of millions of wealthy Chinese suddenly needed chunks of silver for such basic tasks as paying taxes or running a business. It stoked a voracious demand for the metal. Inconveniently, China’s silver mines were just as played out as its copper mines. Businesspeople had trouble laying their hands on enough silver to pay for anything, including their taxes. The sole nearby supply of silver was in Japan. On an official level, China and Japan were not friendly—indeed, the two nations were soon to fight a war in Korea. To get the silver necessary to keep business going, merchants turned to wokou. Businesspeople sold silk and porcelain to brutal men with silver, then turned around and used the silver to pay their taxes, which in turn was spent on military campaigns against those brutal men. The Ming government was at war with its own money supply.

Unable to reconcile the contradiction, Beijing finally allowed Fujianese merchants to trade overseas without fear of punishment. Now acting in the open, they sent thousands of people—younger sons from extended families—throughout Asia to establish beachheads for later trading or extortion. Even a backwater like the Malay village of Manila may have had as many as 150 Chinese residents in 1571, when Legazpi showed up. Hundreds more apparently resided elsewhere in the islands. The unexpected discovery of silver-bearing foreigners in the Philippines was, from the Chinese point of view, a godsend. The galleons that brought over Spanish silver were ships full of money.

“THE TREASURE OF THE WORLD”

How did silver get on those galleons? According to the stories, it began with a man named Diego Gualpa or Hualpa in April 1545. He was out walking at thirteen thousand feet, possibly looking for a lost llama, on a plateau in the Andes Mountains, at the southern tip of Bolivia. (The altitude, amazingly, was not extreme for the Andes, where most of the population lives on high plains that are almost at that level.) No trees, no animals, no crops, no homes—just a bare, dome-shaped hill, clawed by wind and snow, surrounded by still taller mountains splashed with ice. Stumbling on a high ridge, he steadied himself by seizing a shrub. It came out