Transcription
Dear friends, instead of engaging in trivial matters, how should we spend this finite life?
There are some questions that have lingered in my mind for over twenty years. Recently, I have been researching this issue and have finally reached a conclusion. Who is the wealthiest businessman in Chinese history? Or who is the richest commoner? You cannot compare emperors, as their wealth is difficult to quantify; the entire country belongs to them, making it hard to calculate.
So, who is the wealthiest person outside of the emperors? I have come to a conclusion. Why do I have this question? It stems from 2001 when a list was published of the fifty richest business tycoons in the world over the past thousand years, which included six Chinese individuals.
Liu Jin, I believe, had only a few million taels. He was in power for a short time. Then there’s He Shen, and Genghis Khan and Kublai Khan, who cannot be counted. Wu Bingjian, a person I did not know at the time, was also referred to as Wu Hao Guan. They called him by his official title. Nowadays, we refer to someone’s son by their official title.
At that time, it was very popular among the people of Guangzhou. Song Ziwen was one of them. Wu Bingjian's total assets were greater than the combined total of the other five individuals. I raised the question of how wealthy Wu Bingjian actually was. Who was this person? Was he really that rich?
I will also address the questions regarding the other individuals. Wu Bingjian lived from 1769 to 1843, born during the late Qianlong period. He died at the age of 74, during the Daoguang era, after becoming depressed following the Opium War.
Let me show you how a person so wealthy can be worthless under the power of authority. It’s like Jack Ma; no matter how good you are, it’s useless when you encounter the police.
Wu Bingjian was a famous merchant during the Qing Dynasty and was confirmed as the world’s richest man at that time. He held the third-grade official title in the Qing Dynasty, which was a high rank. He was the head of the Jardine Matheson firm, known as Yi He Hang, in the Thirteen Hongs of Guangzhou.
Was Guangzhou one of the Thirteen Hongs? The number fluctuated, with a maximum of seventeen or eighteen. This business has existed since the Ming Dynasty. The merchants in Guangzhou were divided into two types after the Kangxi era: one was called "yang hang," which was not run by foreigners but dealt with foreign trade, and the other was called "jin si hang," which involved buying goods for inland transport and trade.
The "yang hang" was commonly referred to as the Thirteen Hongs. He was the leader of Yi He Hang, managing export trade, especially in tea, porcelain, and silk, playing an important role.
Let me explain. The three major exports of China began with silk, followed by porcelain, which became prominent during the Yuan Dynasty. Silk could be transported via the overland Silk Road, but porcelain had to be shipped by sea to avoid breakage.
Starting from the Yuan Dynasty, Indians and Arabs discovered the secrets of maritime navigation, utilizing the monsoon winds that blow from Southeast Asia and India to the Chinese coast in summer. The sailboats could sail with the wind, and in winter, the northeast winds would blow them back.
Porcelain, especially from Jiangxi, was significant. However, the most important thing is that by the 18th and 19th centuries, tea became the dominant product. Tea was the largest trade in the world at that time, akin to today’s semiconductors or oil from decades ago. Whoever controlled the tea trade was the wealthiest person.
Wu’s family originally resided in Nanhai, Guangdong, but he bought a place there. He was originally from Fujian, which makes sense because only Fujian people could master the tea trade. He was from Anhai in Jinjiang, Fujian.
He bought land in Nanhai and named it Anhai Wu Family, returning to his roots. Initially, he was in the tea business in Fujian, where the best tea in China comes from Wuyi Mountain. He moved to Guangdong in the early Kangxi period and began trading Fujian tea.
Wu Bingjian’s father, Wu Guoying, and his uncle, Wu Guozhao, were acquainted with the wealthiest person in the Thirteen Hongs at that time. Before them, the wealthiest family was the Pan family, also from Fujian, founded by Pan Zhencheng of Tongwen Hang.
This person was remarkable; he spoke several foreign languages and traveled to Sweden. Wu Guoying once worked as an accountant for him. Not only did he participate in trade, but he also helped manage assets and investments, maintaining relations with the British East India Company, learning how to do business and making some money.
In 1783, I want to mention that these two brothers later faced pressure to start a foreign trade business but were hesitant. As a result, they went into the salt business and went bankrupt. Wu Guoying and Wu Guozhao went bankrupt and were missing for seven or eight years. After returning, they resolved their bankruptcy and made some money.
It is estimated that they went to Manila, Annam, or Malacca to continue trading. Was this related to opium smuggling? It’s possible. After making some money, they turned their fortunes around. However, because they had gone bankrupt, they were not allowed to start a foreign trade business again.
They gave Wu Guoying 10,000 taels of silver to establish Yi He Hang in 1783. It was not just about 10,000 taels; starting a foreign trade business required paying respect to the two governors of the ports, the Guangdong Customs, and the provincial governor.
All these people had to be compensated. Without 80,000 to 100,000 taels, you couldn’t manage it. At that time, there was only one place open for trade, which was Guangzhou, monopolizing foreign trade.
In 1801, when his brother passed away, Wu Bingjian took over Yi He Hang alone. People referred to him as Hao Guan. Yi He Hang was very adept at managing relationships, especially with Americans. When Americans faced business losses, he often helped them.
One person owed him 70,000 taels; he tore up the IOU and said, "I’ll lend you a few more thousand taels to go back to America and do business." That person became his godson and later became very wealthy. He was very skilled at nurturing American merchants to compete against the East India Company, eventually replacing Tongwen Hang as the leader of the Thirteen Hongs, becoming the largest creditor of the British East India Company.
Let me explain again. Although the silk trade was important, it began during the Tang Dynasty, and silk and mulberry leaves were already cultivated in Central Asia and Italy. China was no longer the sole monopolist of silk by the Qing Dynasty, so the volume of silk trade diminished.
Porcelain was always a luxury item, highly favored by European nobility. German nobles went bankrupt collecting porcelain. By the 18th century, Europeans began producing porcelain, reducing its importance. The biggest trade became tea.
Tea is a globally popular beverage, the trendiest drink. One reason is that tea aids digestion, provides vitamin C, and contains caffeine for energy. Before coffee existed, tea was the largest commodity in England and worldwide, with its source being China, especially Fujian.
I will explain later why it moved to Guangzhou. This person was originally from Fujian, which is crucial because he mastered the tea trade and monopolized it. During the Napoleonic Wars, the British East India Company faced severe challenges.
During the Napoleonic Wars, British and French ships attacked each other. The British East India Company borrowed two million from the Thirteen Hongs in Guangdong, with Wu Bingjian owed 877,000 taels, which is equivalent to one million dollars.
What is one tael worth? One tael is about 1.2 dollars. If Wu Bingjian had chosen to convert his debt into shares, he would have become the largest chairman of the British East India Company.
First of all, he did not engage in opium trade; he did not need to. Most opium trade was outside the Thirteen Hongs. He mostly financed others to do it. However, those people were very cautious about getting involved in opium due to the risks.
His Yi He Hang had a close relationship with the British. When they came to China, they stayed at his home. The transactions with the East India Company accounted for a significant portion of trade, almost monopolizing China’s maritime trade.
Most of the porcelain trade came from Jiangxi, while silk trade was from Zhejiang and Jiangsu. Tea traders were from Fujian, and at this time, tea was the main product, accounting for half of the tea exports.
Wu Bingjian, through his connections with American tycoon Forbes and his funded Qichang Shipping Company, participated in the Mexican Central Railway, entering the American railway industry. He was a major shareholder in American railroads. Isn’t that impressive?
After the Opium War, he expressed a desire to emigrate to America because he realized living in China was not ideal.
Consider that John Forbes was a railroad tycoon in America. He was a businessman, philanthropist, and abolitionist. In the 1850s, he was the president of the Mexican Central Railway Company and the Chicago, Burlington, and Quincy Railroad.
He invested in Qichang Shipping Company, which was involved in opium trade. This was the Qichang Shipping Company of that time. This type of building, known as Hansha architecture, was typical, with businesses on the ground floor and residences above.
Since the establishment of the Qing Dynasty, Guangzhou had a single port for trade, and by the end of the Kangxi era, the monopoly of the Thirteen Hongs became more pronounced. Yi He Hang primarily dealt in tea, which was considered the best and most expensive.
Yi He tea, once boxed with the Wu family seal, sold at high prices in international markets. Yi He gradually diversified into other businesses, including real estate and tea gardens, becoming very wealthy.
So, how much wealth did he actually have? I can only answer this question. How much wealth did he have? There are reliable records. After calculating farmland, real estate, shops, banks, and foreign investments, Wu Bingjian disclosed his wealth.
At the end of his life, he claimed to have 26.6 million silver dollars. This amount already surpassed the wealth of Europe’s richest family, the Rothschilds, and America’s richest, the Astors, making him undoubtedly the world’s richest man.
With 26 million taels, he had close ties with the Li family, particularly Pan Shicheng, who was previously the wealthiest in Tongwen Hang. Wu Bingjian inherited 20 million taels from his father, Wu Guoying, but his total wealth was estimated to be three times that.
He estimated it to be over 62 million taels, with 50 million taels being a conservative estimate. Why is there such a significant difference? Is it 26 million taels or 60 million taels?
I need to clarify this. By 1830, he divided the family assets. Wu Guoying had four sons: the eldest, Bingyong; the second, Bingjun; the third, Bingjian; and the fourth, Bingzhan. In 1826, he retired.
Wu Bingjian divided the family wealth into several parts. First, the money earned before establishing Yi He Hang, which was the remaining wealth of Wu Guoying, amounted to 20 million taels. This was allocated to the ancestral hall fund for purchasing income-generating properties.
The four branches took turns managing it, with the annual rental income used for ancestor worship. This is similar to what is described in "Dream of the Red Chamber," where a fund is established for ancestor worship, never to be divided.
The remaining money was for their living expenses, known as the sacrificial land. This property was communal, and even if someone committed a crime, the government would not confiscate this money because it was set aside for ancestor worship.
This fund was around 20 million taels, ensuring a lasting legacy. By the late Qing Dynasty, families like Sheng Xuanhuai also had similar arrangements. Eventually, his son used this fund.
This amount was kept in the ancestral hall, similar to a trust fund. Wu Bingjian divided his own money into four parts. How did he divide it? Since it came from Wu Guoying, he was merely managing that money.
The eldest, second, third, and fourth sons each received a share. He himself was the third son, so he received one-fourth. The remaining money, excluding Yi He Hang’s assets, was divided into four parts.
Wu Bingjian’s family took one-fourth, but since Wu Bingjun had no sons, he adopted his grandson. Does this count as his share? I think it doesn’t. So, he had one-fourth of that wealth.
After the distribution of the aforementioned assets, the net remaining portion was for Yi He Hang’s daily operations, which was entirely Wu Bingjian’s family’s capital.
So, he calculated this portion of money and one-fourth of the wealth. It’s clear now. His fourth son, Wu Yuanhua, took over Yi He Hang in 1826. Since Yi He Hang was built by him, this portion of the wealth belonged to his third branch.
What he referred to as 26 million taels was only this portion. The earlier amounts were not included. The total adds up to 60 million taels. After the division, Yi He Hang’s profits were solely borne by the third branch, not affecting the first and fourth branches.
So, he truly had 60 million taels, or 50 million taels. I will tell you how much that is in today’s terms. If you convert it back to today, he was wealthier than Elon Musk, with around 400 billion US dollars.