Chapter 76: Hong Kong (Part 2)

But the conversation soon returned to its original topic. Desmond raised his voice and said, “Prepare 100,000 New Year paintings for me. I want to travel around Africa.”
100,000 New Year paintings naturally referred to francs—100,000 banknotes worth 20 francs each. However, Liu Yu was hesitant about this request. “Mr. Desmond, although there is a large backlog of New Year paintings, 100,000 is an enormous amount. Moreover, you want to withdraw the money directly without paying any deposit.”
He knew well that even if it were fake money, producing such a large quantity would require the mint to work at full capacity for almost half a year. This amount exceeded what Desmond deserved, not to mention the need to consider printing more black-flag banknotes and reserving some for Liu Yu himself.
“You’ve forgotten…” Desmond smiled at Liu Qing. “Lord Liu Qing and Mr. Deng both own shares in the New Year painting workshop. They’ll be happy to let me sell these paintings on your behalf.”
He had calculated carefully—Deng Cunyu, Liu Qing, and even the French minting expert he introduced were willing to use him to dispose of the stolen goods, allowing Desmond to charge a fee. Sure enough, Liu Qing was eager to have someone sell the franc banknotes he deserved. “No problem. Mr. Deng has no objections either.”
Lian Jincheng was also eager to help. “Lord Desmond, should I assist you on your trip to Africa?”
He owned a small share in the mint, so he naturally cared about this crucial matter of disposing of the stolen goods. They quickly reached an agreement on how to divide the profits.
Taking advantage of the opportunity to deliver telephones to Tonkin, they took 2 million francs from the mint to sell in Africa as their share of the profits. But that very night, Liu Yu suddenly realized, “Then the mint would be working for free for half a year!”
He had no choice but to go to Desmond to negotiate. “Lord Desmond, Boss Liu, Mr. Deng…”
At that time, Desmond lived in a finely decorated Dutch-style villa, even complete with a windmill on the roof. Lighting a cigar, he asked, “What do you think of our proposal?”
“I can only say this: even if we gave you all our inventory, plus that of the Black Flag Bank, it wouldn’t be enough to reach 2 million francs.”
“No! No! No!” Desmond shook his head. “It will take about two months to deliver the goods. Surely there won’t be less than 2 million francs by then?”
Liu Qing was clearer about it. He now understood, “In two months, at most 1 million francs can be produced. Currently, about 400,000 francs are produced each month.”
After a quick calculation, Desmond realized that 2 million francs would take about five months to produce. Considering unforeseen factors, it would actually take half a year.
Of the already produced banknotes, some were reserved for the Black Flag Bank, while others were given to Liu Yu to pledge at the Oriental Bank of Commerce in Haiphong. The remaining banknotes would need to be produced again. “The cost of going to Africa is too high. At least 1.5 million francs are needed to make a profit.”
Although investing 10 million francs in the French colonies in Africa wouldn’t cause much of a stir, since this was their first time taking this route and they had no existing clients, it was best to distribute the francs across several countries and colonies.

Liu Yu deeply felt that he was still limited by his production capacity. If he could produce one million francs a month, there would be no problem—but likely, it would be the franc’s credibility that collapsed first. Still, Liu Yu had to agree to Desmond’s request: “How about this… In three and a half months, I’ll prepare 1.5 million francs for you.” Even with a printing press, the amount of currency he could print wasn’t unlimited; it was constrained by objective conditions. Although he could print 400,000 francs a month, considering the huge influence Liu Qing, Desmond, and Deng Cunyu had over the mint, he had to give them nearly two-thirds of the currency. Over there, Desmond noticed Liu Yu’s furrowed brows and smiled. “There’s no need to worry about production capacity. I have good news for you—I’ve prepared something special for you.” “What is it?” Liu Yu knew well that Desmond was the epitome of a unscrupulous merchant, charging exorbitant prices. If a rifle cost three taels of silver in Hong Kong, he would sell it in North Vietnam for at least twenty taels or more. However, one advantage was that his goods were of top quality, practically custom-made for the Xiliu Camp—using Spencer’s barrels and Snider’s modification processes, which greatly enhanced the camp’s combat strength. Now, Liu Yu was curious: “What is it this time?” He didn’t really believe anything could significantly boost his troops’ combat effectiveness like a field telephone network. Desmond simply smiled mysteriously and said, “It will definitely satisfy you.” “What?” Desmond avoided answering and just said, “The samples of the magnetophone have arrived. Would you like to give it a try?” “Sure, why not!” Liu Yu had only played with magnetophones a few times before; now he wanted to try them properly. Besides, he knew magnetophones had another very clever use. “Call everyone here.” Desmond brought two magnetophones and 100 meters of telephone wire—samples from the supplier. Everyone watched curiously as Liu Yu placed the magnetophone on the table, threw down the wire, and ran to the lawn with the magnet motor to test it. Through the window, Jiang Ningxue saw Liu Yu connect the wire and shake the phone handle vigorously. Immediately, a loud ringing sound came through. Following his instructions, she picked up the phone, and Liu Yu’s voice came through: “Ningxue, can you hear me?” She carefully glanced at the crowd testing on the lawn, still hearing Liu Yu’s voice: “Ningxue, Ningxue!” “Ah Yu!” She waved her hand gently at the window, calling out to him, “I can hear you!” Liu Yu was slightly dissatisfied—the magnetophones of this era were even worse than he had imagined. But poor call quality was an old problem; even modern magnetophones hadn’t seen much improvement in sound quality. “I’ll call you back!” Liu Yu hung up the phone. Soon, excited ringing sounds came through. He picked up the receiver and heard Jiang Ningxue’s voice: “I believe that from now on, no matter where you are, I can protect you.”

Jiang Ningxue had already become a loyal user of this new type of electrical appliance. She gazed affectionately at Liu Yu on the lawn, knowing that with this telephone, she could hold onto Liu Yu’s heart. The operation of the telephone was very simple. Although it was part of a self-built network, it was only slightly more difficult to use than a mobile phone. Everyone was extremely interested in this groundbreaking communication tool. Before long, long queues formed both upstairs and downstairs, as people made calls while looking at each other. Standing beside Liu Yu, Jiang Ningxue asked softly, “How far can this telephone reach? If you’re outside, can I call you?” “About a thousand miles? As far as the telephone lines can extend.” One drawback of magnetophone telephones was that the signal didn’t travel far; the longer the telephone lines, the worse the call quality. Liu Yu, however, was concerned about the telephone exchange: “I said, Desmond—just two telephones? Hasn’t the exchange arrived yet?” Desmond replied with a smile, “I’ve gone to hurry it up. It’ll arrive soon. There are four more telephones and one exchange.” As the owner of a foreign firm, he was well aware of its weaknesses. One hundred telephones, along with so many exchanges and telephone lines, was already a huge investment—so much so that it could be considered the largest telephone-related deal in the Far East. But everyone knew this was just the beginning. Telephones would surely become widespread worldwide, and it would depend on who could seize the opportunity first. According to news from Europe and America, within just two years, many large cities already had hundreds of telephone users, and the entire country had tens of thousands. There was even expected to be explosive growth ahead. Based on European experience, whoever secured the first order from a major client would have to handle subsequent orders, maintenance, and after-sales service themselves. With such a major client before them, who could doubt the volume of business they would bring—thousand units, ten thousand, or even tens of thousands? Just this one deal would be enough for their medium-sized firm to thrive for a lifetime. So they immediately sent twelve telephones and two exchanges, even more than Liu Qing had requested. People were still queuing up to make calls, and now there was a new development: setting up calls. Through the telephone exchange, the small network of twelve telephones began to make calls to each other via manual switching. Several officials like Jing Shiyi and Jieken stood alongside technicians learning how to connect calls. Soon, they became manual switchers, though they made many mistakes, but everyone was happy. For people living in isolation, this was not just a tool but a revolution. For farmers who were only familiar with rifles, it would bring about complete changes in both daily life and military affairs. Jiang Ningxue said softly, “Ayu, telephones are really wonderful!” With telephones, even if Liu Yu was away, she could hear his voice every day. Meanwhile, Jieken stood in the distance, marveling, “It’s truly a treasure!” The telephone lines weren’t long enough yet, but once they set up telephones in the field, not only could several infantry battalions be commanded independently, but for the artillery as well, telephones were an ultimate weapon to boost combat effectiveness.

Not even Liu Yu knew that in terms of communication, he had already surpassed the French forces in the Sino-French War, as well as most Chinese armies decades later. Even the People’s Liberation Army in the early days of the nation could not afford such luxury as using telephones to direct infantry units. Everyone thought of countless ways to use telephones to improve their lives, and Jiang Ningxue even asked Liu Yu directly, “When we return to Shanxi, I want a telephone in my room.” “A dedicated line—I’ll install one for you,” Liu Yu agreed readily. “I’ll call you every day.” The young couple went to bed, but the technicians from the foreign firm and the people of Xiliu Camp stayed awake until late at night. They even tried field communication on the spot, and everyone agreed that with this technology, command capabilities could be greatly enhanced. Jie Ken said while connecting the lines, “It seems the communication platoon will become very important from now on.” Jing Shiyi glanced at him—wasn’t that obvious? “By the way, with such an excellent thing, why didn’t the Qing army have any?” Building a comprehensive telephone or telegraph network in China was a very long process. The first major expansion of China’s telegraph network had just begun, and as for telephone networks, the Qing officials lacked the awareness for it. The technicians from the foreign firm, however, picked up on something: “I heard you still need telegraph machines?” “Our commander originally wanted to buy telegraph machines, but since telephones now exist, he temporarily redirected the funds to telephones.” Telephones were simpler and easier to operate, not as intimidating as telegraph machines, but the technicians weren’t entirely convinced. “Telegraph machines also have their advantages. Using telephones for short distances and telegraphs for long distances is the best approach. Do you need to come to our firm to take a look?” Jing Shiyi immediately replied, “The problem is, we don’t understand code.” “That’s not a problem. We’ll send someone with you to install the telephones and have them bring along a few telegraph machines… Um, does anyone here speak English?” English and French education were in full swing at Xiliu Camp. In this era, there were no excellent learning tools like the Rosetta Stone, but the pressures of the times forced many people at Xiliu Camp to master at least a basic foreign language. And now, that could come in handy. “Of course, there are people who speak it!” “Great! We can provide full-service support, including training telegraph operators. I suggest you buy some telegraph machines. Of course, if you combine telephones and telegraphs, we can offer an even better price.” It wasn’t just a better price—even a small profit on the first order was acceptable. The telecommunications business would bring huge profits in the future. Once they secured this first order, Xiliu Camp and the Black Flag Army would have to turn to them for all their communication needs. What they didn’t know was that Liu Yu had already thought of replicating magnetophone telephones. After all, the technical difficulty wasn’t particularly high. Even if they couldn’t manufacture them themselves, they should be able to assemble them. As for telephone lines, he had resolved to find a way to create twisted pairs—telephone lines in this era weren’t twisted pairs yet, which greatly affected call quality.

But what concerned him more was Desmond’s promise: “Well, what kind of surprise are you planning for me?”
Desmond smiled. “Of course it can’t be weapons. I’m a legitimate businessman who does business honestly and never resorts to any shady tactics.”
Hearing this, Liu Yu became even more interested in what he was recommending; he knew it must be something good.
Desmond also smiled, saying he had put in a great deal of effort to obtain it.