Chapter 287: Sweet Port Turbulence – The Gu Family Pirates
Several small fisher-pirate bands operated in the waters around Leizhou, and among them, the Gu family's outfit was considered moderately formidable. To the local populace, these petty corsairs were a genuine plague—but to the Haiyi Guild, they were beneath notice. The guild maintained its own militia, and whenever sugar ships put to sea, they sailed in convoys with hundreds of armed sailors. Such paltry pirate bands couldn't so much as scratch them. Attempting to do so risked breaking their own teeth.
What the Haiyi Guild truly feared were the great maritime warlords—men like Liu Xiang and Zhu Cailao—and so they paid heavy tribute to secure their peace. But for the smaller bands, token gestures sufficed to avoid harassment. Otherwise, no matter how many militiamen the guild fielded, they would be run ragged chasing shadows.
These token gestures, however, remained carefully limited. Though small pirate bands operated at sea, they inevitably required shore access—to rest, repair vessels, purchase rice, and settle their sick and wounded. They needed reliable havens on land, which meant cultivating relationships with local powerbrokers.
Third Master Zhu exploited this dynamic masterfully. Through careful application of carrot and stick, he reached accommodations with several nearby maritime outfits. They guaranteed not to molest sugar ships sailing from Hai'an or harass the Hai'an Street operations. In return, the Haiyi Guild provided cover for their onshore activities in Xuwen—arranging lodging, facilitating resupply, turning blind eyes where necessary. Such arrangements cost little money and occasionally proved useful.
Over time, although the smaller pirate bands rose and fell—some wiped out, some accepting amnesty, some simply disbanding—the Haiyi Guild maintained cordial relations with whoever held the waters. The arrangement worked because each side took what they needed.
Gu Dachun, as gang leader, was a man who valued loyalty. Though his relationship with the Haiyi Guild amounted to mutual exploitation, one incident had deepened the bond considerably. Years ago, when Third Master Zhu led a fleet caught in a sudden storm, Gu Dachun happened to be sheltering near the coast. He braved the tempest to sail out and guide most of the sugar ships to safe harbor. Third Master Zhu marked him as a man who kept faith and honored righteousness—a useful quality—and the two became sworn brothers. Their friendship deepened over subsequent years, and eventually Gu Dachun married his recently widowed sister to Third Master Zhu as his sixth concubine.
In a sense, it was a political marriage. Third Master Zhu had approached it with modest expectations: the bride was a "withered flower" entering her second marriage, and coming from a fishing family, how much beauty could she possess? Presumably her brother simply loved her and wanted to secure her a stable home. He would marry her, arrange comfortable quarters, and ensure she was fed and clothed. That would suffice.
The reality proved otherwise. Although the sixth concubine came from fishing stock, her appearance was quite striking, entirely lacking the weather-roughened look common to sea families. Rarer still, she was attentive in her service, skilled in both needlework and cooking. Inquiry revealed the explanation: in her youth, she had been sold to a wealthy local household as a maidservant and eventually taken as a concubine. When the master died, the principal wife expelled her. Now she served the fifty-odd-year-old Third Master Zhu with practiced devotion, and he found himself unexpectedly content.
Since the Gu Dachun connection existed, why not put it to use? The benefits would flow to everyone involved. His mind was made up: strong medicine was required.
Once this strong medicine took effect, the transmigrators would naturally become docile. In his own words, it was like pulling the firewood from under the cauldron. No matter how much strength the South China Factory possessed, they would be trapped to death in Leizhou.
"Qiuhan!" he called. The name dated from her days as a maidservant—in these times, women rarely received formal names, and childhood appellations persisted.
"What is it, Master?" The woman answered and came.
"How has your brother been lately?"
Qiuhan showed surprise. Her master rarely mentioned her brother in her presence, given that his occupation violated the King's law. To avoid complications, she never acknowledged having a brother before others.
"He's well. Master must have forgotten—someone delivered goods just a few days ago."
"Mm, yes, of course." Third Master Zhu remembered.
"And the brothers—are they living comfortably?"
"How can one speak of comfort in such a life? They manage." Speaking of her own family, Qiuhan couldn't suppress a sigh. So-called pirates varied enormously between great and small. For an outfit like the Gu family—three or four single-masted boats without even a cannon—"coastal robbery" meant only limited targets: small craft hugging the shoreline. Naturally, pickings were slim.
"There is a path to wealth available now. I wonder if your brother would be interested?"
"Truly?" Qiuhan's face lit with surprised delight. Though Third Master Zhu looked after her family, this was the first time he had spoken such words.
"When have I ever deceived you?" Third Master Zhu smiled.
"Thank you for Master's grace." Qiuhan curtsied deeply.
"Grind ink for me—" He reached for his brush, intending to write a letter, then thought better of it. Once committed to paper, such a letter falling into wrong hands would mean catastrophe. Better to have someone deliver the message in person.
"Return to your maiden home," Third Master Zhu said, lowering his voice. "Tell your brother that a massive fortune will soon appear near Hai'an Street." He described the sugar ships that would shortly depart from the South China Factory.
"The Haiyi Guild won't have vessels leaving port in the coming days. Tell your brother that as long as he identifies ships bearing the South China mark, he should strike without hesitation."
"Such an opportunity exists?" Qiuhan said wonderingly, lighting his silver water pipe.
"Indeed. Once he succeeds, I will purchase all the sugar myself. He need not worry about disposal."
"Thank you for Master's grace!" Qiuhan curtsied again, her face radiant with joy.
"Who else should I help but my own brother-in-law?" He smiled and caressed her cheek, though inwardly his calculations ran differently. Large cargoes seized by pirates were notoriously difficult to transport and store, which made them extremely cheap when sold under duress—probably less than two or three qian per shi. The profit would be immense.
"However," Third Master Zhu's tone shifted, "these ships are not to be trifled with. Your brother's outfit alone may not suffice. Tell him to recruit more hands for this job. The fortune is substantial—there's no need for stinginess."
"Yes, your servant understands. I'll leave tomorrow morning."
"No rush—wait a few days." He stroked Qiuhan's hand. "Perhaps ships carrying silver from Guangzhou will arrive as well. This matter requires careful long-term planning..."
While the South China Factory secured its fifty thousand taels in working capital, the Haiyi Guild made its own calculations. In sleepy Xuwen County, undercurrents churned. All parties prepared for a high-stakes gamble with the annual four or five hundred thousand taels of South China sugar as the prize. Meanwhile, in Guangzhou and Lingao—the two crucial bases of the Transmigration Senate—equally intense strategizing was underway.
After Wu De rushed back to Lingao, he requested an immediate Executive Committee meeting. The proposal from the Guangzhou Station to absorb retail deposits was approved—the Leizhou sugar affair had driven home the meaning of "Cash is King." Without substantial liquid capital, similar crises would plague every future market expansion.
Cheng Dong raised a broader proposal: why not simply establish a dedicated financial institution in Guangzhou, responsible for absorbing deposits, raising commercial working capital, and conducting remittance business? Financial infiltration into the Great Ming.
"You mean opening a bank in Guangzhou?" Ma Qianzhu's voice carried an edge of tension.
"Precisely. A bank." Cheng Dong nodded. "Of course, what we establish would strictly qualify only as a qianzhuang or piaohao—hardly worthy of the title 'bank.'"
"How would it work?" Excitement rippled through the room. The word "bank" carried considerably more gravitas than the nondescript grain trading house.
"According to the Guangzhou Station's investigation, no such financial institutions generally exist in this timeline yet," Cheng Dong continued at his unhurried pace, consulting a rough notebook bearing the 'Holy Ship' brand. "Only money exchange shops exist—operations dealing in silver and coin conversion. The Intelligence Bureau's investigation confirms that besides exchange, these shops engage in small-scale lending, but they don't absorb deposits. Essentially, they profit from currency fluctuations and exchange spreads. The overall capital scale remains modest."
What the Finance Committee had identified as promising was remittance business. Simple remittance existed in the Great Ming—primarily inter-branch transfers between shops to reduce the trouble of physically transporting silver—but the scale remained limited, serving mainly the needs of their own commercial networks. A dedicated draft remittance industry like the piaohao had not yet emerged. This represented virgin territory with enormous potential.
"Our bank's focus will be remittance, similar to piaohao operations. After building credit over several years, our silver drafts will circulate throughout the realm."
Ma Qianzhu shook his head. "The Great Ming doesn't seem to have substantial demand for remittance." From what they had observed, the commodity economy remained modest—not primitive, certainly, but far from advanced. Claims about China entering the primary stage of capitalism seemed premature at best.
"Not so. Although capital flows are limited in scale, they exist. Leizhou sugar is a prime example. We believe that at minimum, Songjiang cloth, Jiangxi tea and porcelain, Jiangnan silk, and Fujian indigo all involve large-scale silver movements." He took a breath. "Even in peripheral Hainan, according to Intelligence Bureau findings, the annual betel nut and copra trade amounts to several tens of thousands of taels. By any measure, that's significant volume."
The products he listed were highly seasonal, and production was typically dispersed. Whenever harvest season arrived, merchants transporting goods required large amounts of capital for acquisition. The demand for capital circulation would be enormous.
Remittance business offered multiple revenue streams: first, remittance fees—essentially handling charges; second, profits from interest differentials based on silver price fluctuations and varying money supply tightness across regions. As long as physical silver could be turned over efficiently, the possibilities for financial engineering were endless.
Another purpose for the Finance Committee in establishing a bank was to build credit for their own silver drafts as rapidly as possible. Future transmigrator economic, political, and military activities would span the entire country. Whether army, merchants, or intelligence operatives, none could traverse the realm carrying physical silver. As for the Lingao Circulation Certificates based on a rice standard—that was merely a short-term transitional measure, impossible and unnecessary to establish for nationwide circulation. Silver drafts, by contrast, were convenient to carry and use.
"Doesn't this amount to issuing another currency?" someone objected. "With Lingao Circulation Certificates, and now silver drafts—isn't this unnecessarily complicated?"
"That's a misunderstanding. Silver drafts aren't currency; at most they qualify as commercial paper. Although in late Qing times people often used silver drafts as direct payment, the theatrical scenes in movies where someone produces a fistful of silver drafts to settle bills are pure fiction."
Silver drafts carried varying levels of credit. Unlike copper coins backed by government authority or silver ingots representing actual precious metal, a draft's acceptance—how firmly it stood in the market and how widely it circulated—depended largely on the issuing institution's strength and reputation. Some drafts circulated only locally; others reached the four corners of the empire. The variations were numerous and subtle. Cheng Dong didn't elaborate on every detail, but he emphasized that establishing draft credit would yield enormous advantages for future capital mobilization and fundraising.
Wu Nanhai persisted in his objection. "The Central Plains will soon descend into turmoil. Draft remittance inherently requires branch offices. Investing substantial funds and personnel, only to see it all destroyed once war erupts—what's the point?"
"Unnecessary," Yan Ming replied. "We're not operating a modern bank. No need to establish locations everywhere. We need only set up offices in select locations where commerce flourishes and officials congregate. When necessary, we can also form remittance alliances with capable local establishments."
The branch strategy focused on opening key routes. The Southwest, Northwest, and Central Plains—either impoverished regions or areas destined for future unrest—were obviously unsuitable. The critical artery was the North-South corridor, especially from the Capital to Jiangnan. Everyone understood the logic: in the Ming's final decades, Jiangnan would remain the wealthiest and most peaceful region. Officials in the Capital would inevitably transfer substantial silver to this paradise for future enjoyment. The region was also the primary producer of cloth, silk, and tea, with correspondingly intense commercial activity.
"For specific branch cities, Southern Zhili comes first," Yan Ming continued. "Nanjing, Suzhou, Songjiang. Once stabilized, we expand northward to Qingjiangpu and Beijing."
Suzhou and Songjiang were Southern Zhili's wealthiest. The Northern and Southern Capitals, as seats of power where officials congregated, naturally demanded priority. As for Qingjiangpu—though merely a nameless county town in the twentieth century—it was a major transportation hub where north-south traffic converged during the Ming and Qing dynasties.
At the Ming-Qing transition, navigating the Grand Canal was treacherous due to lock passages, and sailing the Yellow River perilous. Travelers heading north or south—excepting grain transport vessels—typically abandoned boats at Qingjiangpu, proceeded north via the "Thoroughfare of Nine Provinces," crossed the Yellow River at Wangjiaying, and continued by horse or cart. As a transportation nexus between north and south, commerce naturally flourished. The town also housed granaries managed by the Ministry of Revenue and shipyards under the Ministry of Works, with important officials like the Governor of the Southern River in residence. Annually, the court dispatched substantial sums for river management, and the wealth of river officials was legendary throughout the realm. Many officials and merchants meant constant silver flows—truly a feng shui treasure ground for remittance business.
(End of Chapter)