Chapter 1462: I have

Guo Zhaode nodded without hesitation and said: "Of course, the cost we paid is too high. If Sax's plan is successful, then we will suffer very serious losses."
"It is impossible for him to succeed at all, and his mission is not to help those "CIS" countries succeed in economic reforms." Tan Zhenhua said indifferently: "I have full confidence in this."
"Oh? His mission?" Guo Zhaode asked suspiciously: "Isn't he an economic consultant hired by the Ye Liqing government? What mission does he have?"
"He has it." Tan Zhenhua replied, and easily pulled a piece of the "Washington Post" issued today. There was a large photo on the second page of the newspaper. In the photo, "International Finance Golden Boy" "Jeffrey." Professor Sachs arrived at the Moscow airport and waved to the people who came to welcome him.
On his waving right hand, he wore a small, inconspicuous ring.
The Rakshasa version of "shock therapy" was implemented as quickly as possible. According to Sachs's recommendations, the Ye Liqing government implemented a strict currency issuance and government spending "double tight" policy and price reforms in an effort to increase revenue and reduce expenditure.
In terms of income increase, all commodities are subject to 28% value-added tax and an additional consumption tax on imported goods. In conjunction with the income increase measures, the government has also implemented large-scale cost-saving actions, reducing public investment, military spending, and office expenses, and cutting off-budget The fund is included in the federal budget, restricting local governments from using bank loans to cover deficits.
At the same time, the Rakshasa Central Bank began to tighten currency, including raising the central bank's loan interest rate, establishing a deposit reserve system, and implementing loan limit management, in an attempt to control the money supply in the market to curb inflation from the source.
These seemingly good policies have led to further chaos and deterioration of the situation, because some of the measures produced effects that were originally contrary to each other and did not fundamentally solve the contradiction that caused this hyperinflation.
For example, one of the root causes of this large-scale hyperinflation is the imbalance on the supply side. The industrial and agricultural system of the former Soviet Union was too severe to meet the basic needs of the people. A large number of materials depend on imports, and the prices of imported goods However, they are largely in the hands of international speculators. It is these people who are consciously importing inflation into the countries of the former Soviet Union. However, this reform did not touch this field, or that the "CIS" countries did not The method affects the price trend of these international bulk commodities, and with the increase in tariffs, the prices of these commodities are further pushed up when they reach the consumer end, which instead contributes to a further increase in inflation.
For another example, this new economic reform has greatly increased the tax burden of domestic production enterprises, causing the production of these enterprises to shrink further, and the number of unemployed people soaring. The government has to increase relief subsidies and direct investment to maintain social stability, and the fiscal deficit Rise instead of falling. Credit tightening has caused serious shortages of corporate liquidity, mutual defaults among companies, and increasingly serious triangle debts. Numerous companies that have just moved from a planned economy to an era of free market competition have insufficient experience and accumulation. They are unable to cope with this situation and many companies are facing bankruptcy.
The implementation of "shock therapy" in just a few months led to extremely serious consequences. Not only was inflation not suppressed, but it worsened. It was only in April 1992 that the retail prices of consumer goods had risen 65 times compared to December 1991. By June, the wholesale price of industrial products increased by 14 times. Such high prices made buyers daunted. The consumer market continued to be sluggish and weak demand restrained supply. Enterprises have compressed production, and market supply and demand have entered an endless loop!
In the face of this situation, Yegor Gaidar, who is responsible for advancing the reform, tried to restart the original state-owned commercial distribution channels and stabilize prices by increasing government subsidies to these channels, but this attempt was soon overwhelmed by reality. Facing the face-channels received high government subsidies, but the people in charge of these channels colluded with black market vendors large and small, and the subsidized goods failed to be placed on the shelves of these channels, but a large number of them flowed into the black market. , And then sold to final consumers at a higher price by black market vendors. As a result, the government’s fiscal revenue was encroached on by high subsidies, while the ordinary people failed to obtain any substantial benefits, just fattening the middle to do it. That small group of people.
In the face of this situation, Sachs prescribed another potent medicine. His new proposal even violated the most important "double tightness" principle in the "shock therapy" he had initially promoted to the Ye Liqing government-he suggested that money should be relaxed.
As Tan Zhenhua commented, in addition to vodka, whiskey was mixed in the minds of the leaders of this session of the "CIS". This apparently contradictory policy was unexpectedly adopted by them without hesitation. The Ye Liqing government started the money printing machine. According to statistics, in 1992, the Rakshasa Central Bank issued an additional currency of 18 trillion rubles, which was 20 times the amount issued in 1991!
A huge amount of money is pouring into the market, while the supply of goods is declining. What will this cause?
As a result, the "CIS" countries are facing an inflation rate as high as 2000%!
If at the beginning of 1992, 10,000 rubles could make a family live comfortably for a year, then by the end of 1992, 10,000 rubles would only be enough for the whole family to eat a barely full dinner!
Ordinary people can only feel that life is getting harder and harder, while some more sensitive people perceive other changes in wind direction.
I don’t know since when, international public opinion, including media large and small in the "CIS", began to criticize the ruble and the state-owned enterprises of the former Soviet Union. These public opinions quoted many internationally renowned financial and economic experts. "The research statement", they believe that "the former Soviet Union has enterprises with no viability", "the former Soviet Union's corporate bonds are severely overvalued", "the ruble needs to be priced from scratch", and "the ruble should adopt a freer market-based float "...
These public opinions were only sporadic at first, and gradually showed a kind of sparkling prairie fire. Later, it can be said to be overwhelming and flooded in people’s sight, especially in the media within the "CIS" countries. Human consensus...
...
On June 8, 1992, Tan Zhenhua put on his Ph.D. hat and took over his Ph.D. diploma from the principal of Hennessy with a smile on his face, saying goodbye to his student days.
He stepped off the rostrum and hugged one by one with his relatives and friends who came to observe the ceremony. Everyone expressed their sincere congratulations to him, especially Vivienne. She was very excited today, as if she took it today. It was not Tan Zhenhua who arrived at the degree but she was the same, and when Tan Zhenhua hugged her amidst the laughter of her friends, she whispered to Tan Zhenhua's ear:
"Eric, I have good news for you. I have it."