The Japanese government tried to stop it.
They passed laws, they warned people, but in the end they failed.
Chinese coins flooded the market.
“How did we get here!” Japanese leaders lamented.
Lucky for them, this channel exists to tell them how.
One of the perks of ruling a country is you get to make your own money.
Japan tried this in the Nara Period [710 - 794],
but because the Imperial court was more interested
in using its new coins for power and wealth
instead of making sure they succeeded in the market,
it was kind of a disaster.
By the mid-1100s, Japan had already given
up the whole coin nonsense and most of them
were lost or destroyed.
But that didn’t mean people stopped using coins,
they just used other coins.
Coins are awesome.
They last a long time, they fit in your pocket,
and they help you make life decisions.
At the time, instead of coins, they mostly used cloth, silk, and rice.
These things were kinda s--t.
“Hi I’d like to buy a PS5, here’s a bowl of chicken fried rice.”
Luckily, around the mid-1100s,
Chinese copper coins started making their way
into the hands of the Japanese.
They were a big hit.
Rice can get moldy,
silk and cloth can be defeated by a moth,
but cash can survive a thousand years.
The Japanese imperial court saw Chinese coins
becoming more popular and were like,
“Why didn’t you guys like our coins?”
And decided this atrocity had to stop.
“This has to stop,” they said.
Why did they hate it so much?
Having too many new coins might have caused inflation,
destabilizing the economy and causing people to suffer…
was not what they were worried about.
Actually, Japanese nobles didn’t seem all that concerned about economics,
but it’s hard to be concerned with something that you know nothing about.
One noble wrote in his diary about a meeting the imperial court had.
Number One on the agenda: how to deal with these damn Chinese coins.
Number Two on the agenda: choosing more funny hat designs.
They called in a market expert, and the noble
learned something he thought was so important
he had to write it in his diary.
The noble called it the Law of the Market.
In a marketplace, one person tries to sell at a high price,
and the other person tries to buy at a low price.
They negotiate and reach a final price somewhere in the middle.
This is called the Law of the Market.
Dude literally described bargaining like he just discovered relativity.
So why did the Japanese government hate these coins?
Because back then, coin money was not just money.
States minted their own coins to flash to the world
their two large qualities of power and sovereignty.
“We’re an independent state! Look, we even have our own money.”
For a dirty foreign coin to invade Japanese soil
was a challenge to the authority of the imperial court.
In 1192, the court banned Chinese coins.
And nothing happened, people still used them.
The nobles were like, “That’s weird,” and issued the ban again the next year.
And nothing happened.
Economics is hard when you just learned about bargaining last week.
You couldn’t just ban these things, there was too much demand.
The court called them counterfeit coins
and punished people using them,
but people just said punish me more, daddy.
The court sent the imperial police to enforce the ban,
but even the police became a problem sometimes.
Once, a group of police officials came up to a merchant
and asked to buy his stuff using Chinese coins.
The merchant was like, “What? No! You’re the police.”
The policemen were like, “Oh it’s okay, the ban doesn’t apply to us.”
And the merchant was like, “Nice try.”
So the police took his stuff and threw him in jail,
and told him to stop it with the surprised Pikachu face.
Luckily, the merchant had ties to a shrine.
The shrine brought the case to the imperial court, and won.
It was a big case because the court exiled
the head of the Office of Policing and 8 other officials.
So even the people who were supposed to
keep the public from using coins…
used coins themselves.
As the government was going around being ineffective,
Chinese coins flooded the market.
How did all these coins end up in Japan?
Well over on the continent, Big Brother China
was having a great time being successful.
The economy of the Song Dynasty grew bigger
than a frog’s chest when it goes ribbit.
Song China used copper coins for currency,
so they started pumping load after load of
coins into the growing economy to meet demands.
In 1073, at the peak, they were making 6 billion coins a year,
and still couldn’t afford a barber for their kids.
Coins flooded Chinese markets, and leaked
into the surrounding states, including Japan.
Japan was awash in Chinese coins.
Japan used coins like it was a cheerleader and coins were nerds.
Why did they become so popular?
Mainly because a regular supply of high quality coins
were coming from China, and there was enough
to make money available to random Joe Schmobunagas on the street.
Also, Japan was growing.
People needed money they could count and carry around in their pockets.
They didn’t want the hassle of carrying a
bag of rice whenever they went to the movies.
Oh here comes Genji again, showing off his money,
ever since he landed that job collecting poop in the capital.
Once in a while, archaeologists would dig
up these large vases that people buried for safekeeping,
filled with tens of thousands of coins.
When historians found a merchant ship that
shipwrecked in the late Kamakura Period and looked inside,
they found 8 million coins.
Now you would think that the Chinese government
wouldn’t be too happy that their money was
being sucked out of the country.
And you’d be right.
The Chinese government banned the exporting of coins.
Stop taking our money!
So you had bans on both sides.
The Japanese banned using Chinese coins, and the Chinese banned exporting them.
And people were like “Nah.”
Merchants made a killing on Chinese coins, they couldn’t stop.
Because in the 1100s and 1200s,
the value of gold to copper was higher in China than it was in Japan.
Meaning…if one bar of gold got you 100 copper coins in Japan,
the same bar of gold would have gotten you 600 copper coins in China.
So Japanese merchants would take a bunch of gold,
hop on a boat to China,
and trade the gold for a whole lot of coppers.
And Chinese merchants loved it because the
Japanese were selling gold below normal Chinese prices.
One Chinese official in the mid 1200s wrote
that when Japanese ships docked at his port,
all of the coins in the area would *poof* disappear.
And the ships would leave all fat with coins falling out their asses.
Chinese merchants did the reverse.
When they sailed to Japan, one of the most
common items they traded was Chinese coins.
Right after the Yuan Dynasty’s failed invasions of Japan,
Japanese merchants went right back to China,
the nation that just invaded them, to get more Chinese cash,
maybe to fix the things destroyed in the invasions?
By the early 1200s, people mostly stopped using cloth and silk as currency.
And by the end of the 1300s, even rice became a minority currency.
The coin invasion was complete.
It was a big change to Japanese society, especially for the lives of commoners.
Money can’t buy happiness, but it can buy you an economy.
Chinese coins greased the wheels of trade, removing the squeeks of inefficiency.
In the Heian Period, trade mostly happened around the capital.
Currency was really only used by nobles and major temples.
But by the end of the Kamakura Period, markets started popping up across Japan.
Coins made it easier to lend money with interest.
Peasant communities gained more financial
freedom because they could more easily sell their goods.
There were cases of villages getting together
and setting aside pools of money for emergencies.
Wealthy commoners popped up and started using
their wealth to influence and challenge the people at the top.
They lent money to elites.
Sometimes even nobles couldn’t pay their debts,
and lost their lands to wealthy commoners.
Japan used Chinese money from the 1100s to the early 1600s,
when the Tokugawa Shogunate finally made an official Japanese coinage system.
It was more successful than their first attempt back in the Nara Period,
which kinda ended in disaster.
The failure of that first attempt gave
Chinese coins the opportunity to invade Japan.
It’s a cool story bro, click here to learn about what happened.
We have some new people on Patreon this week:
Tim Hammack, Dave Ballard, Capt_Buck, and Muskrat.
Thanks so much you guys.
Alright I love you, and spread the knowledge!