Chapter 79: Runaway Demand

He turned to Desmond and asked, “Are there any companies dealing with trains?”
Desmond laughed. “You can’t become fat in one bite. You want to get into the railway business right away? That’s tough. With this amount of money, you can at most get a small mine train.”
Although Liu Yu had four or five hundred thousand francs, it was far from enough to build a train—at most just a few kilometers of railway track. Yet Liu Yu smiled and said, “It’s not about getting on a train, but about obtaining some components.”
In this era, Hong Kong still had no railways. The Kowloon-Canton Railway wouldn’t open until 1910, and not even a single inch of railway existed across mainland China. Yet train-related components could still be found.
Japan was vigorously building railways at the time and often needed to import train components from Hong Kong, ranging from wheels to locomotives. So Desmond quickly found a company dealing in railway business for Liu Yu.
“What do you need?” The company’s agent showed great enthusiasm toward any customer. “Just give me your instructions!”
This company dealt in large-scale imports—trains, ships, machine tools—covering every type of business. Any potential customer had to be prepared to spend a fortune. Moreover, the agent noticed that the young man was accompanied by a Dutch manager.
“I want to see train axles!”
“No problem! Please follow me. Just tell us how many you need. Our company has a good reputation and is one of the largest suppliers of train axles in the Far East…”
Train axles were naturally used to make mortars. Since seamless steel pipes couldn’t be found, train axles had to be used as substitutes.
Don’t underestimate these train axles. Due to the immense pressure exerted during train operation, their manufacturing process was quite similar to that of cannon barrels.
Modern America lacked the capacity to produce cannons in its civilian industries, but if needed, train axle manufacturers could easily switch to producing cannons. In the 1970s, many PLA armories used machinery originally designed for producing cannon barrels to make train axles, producing tens of thousands of them and saving the country a great deal of foreign exchange.
Historically, train axles had also been modified into mortar barrels, even into barrels for the Type 92 infantry gun. The Jiaodong 82-mm and 100-mm mortars were all made from modified train axles.
However, the most successful example of using train axles to make artillery was in Shanxi. The Taihang base area used a large number of discarded train axles captured from the Jinpu and Pinghan railways to make cannon barrels—one axle per barrel. Locomotive axles were turned into 150 barrels, while carriage axles were turned into 120 barrels, resulting in the production of 378 heavy mortars.
60-mm mortars could be used immediately and then abandoned, but these heavy mortars were also highly flexible. Each required only one horse to carry, allowing them to cross mountains and narrow paths. They were easy to deploy, highly mobile, and quick to set up, making them very popular among troops.

Of course, its advantage was its relatively short range, making it more suitable for assault missions, and it didn’t meet Liu Yu’s vision of an extremely agile 60-mm mortar. However, it had greater firepower. In 1947, several 120-mm heavy mortars were used in the Yuncheng Campaign; a single shell killed or wounded over fifty defenders, another shell destroyed six cars, and the lethal radius of one shell reached fifty meters. In the Taiyuan Campaign, the 150-mm mortar was said to cause walls to collapse when it hit them and destroy bunkers and kill those inside.

Thus, Liu Yu also set his sights on train axles, and his expectations were met—there were indeed many in the warehouse. Although they couldn’t be modified into 150-mm mortars, a quick measurement showed they could be adapted into 120-mm heavy mortars. With the barrel in hand, the next challenge was to find shells. The real difficulty lay in the fuses, but the two easiest types to produce were time fuses and impact fuses. Time fuses were simpler, as most early mortars used them. So Liu Yu resolved to devote all his efforts to developing a usable mortar once he returned to Shanxi.

The foreign company did stock up on many train axles and hadn’t expected them to be modified into barrels. They allowed Liu Yu to measure the diameter. Suddenly, he stumbled upon something valuable in the warehouse: “What’s this?” The company’s agent glanced at it and said, “Are these axles from a mine train? Do you need them too?” It was truly a stroke of luck. He had thought the 60-mm mortar was beyond hope, but these mine train axles were much smaller than ordinary ones. After measuring, they turned out to be perfect for modifying into 60-mm mortar barrels. Liu Yu’s face lit up with joy. He knew that although the 120-mm and 150-mm mortars had greater firepower, they were less mobile against the French artillery advantage, and the bigger problem was that these guns were too heavy to manufacture. He should focus on the classic calibers of 60 mm and 82 mm. He nodded at Desmond and said, “Let’s look for more options!”

Among the pile of train axles, he indeed found ones suitable for modifying into 82-mm mortars. He immediately placed an order: “How many of these small mine train axles are there? Give them all to me. As for the rest…” In the end, he calculated 80 60-mm mortar barrels, 60 82-mm mortar barrels, 40 100-mm barrels, 30 120-mm barrels, and 20 150-mm barrels. The cost wasn’t high, but Liu Yu had further demands: “I want these train axles modified.” Although train axles were similar to mortar barrels, they needed to be hollowed out first. Additionally, many related processing steps were required. All these processes could be carried out in Shanxi, but due to technical standards and other factors, it would be much more difficult. In Hong Kong, a renowned metropolis in the Far East, he could take advantage of its strong industrial base for modification.

The result was that modifying the gun barrels and other processes cost quite a bit of money—almost as much as buying train axles. Of course, this was just the first step. Next, Xiliuying would need to tackle technical challenges: on one hand, produce artillery, and on the other, develop mortar shells with time fuses. If there was enough capacity, they could also work on impact fuses.

Liu Yu was quite satisfied with this outcome. After purchasing some urgently needed supplies, he stayed in Hong Kong for over ten days before returning to Vietnam with more than 200 gun barrels along with a large amount of machinery and weapons.

The French clearly despised Liu Yu for not even having seen train axles and still wanting to bring them back home. In their eyes, he was not a commander with long-term vision.

This time, they hired four steamships. After facing several difficulties at Vietnamese customs, they finally made it past Hanoi and headed toward Shanxi.

Liu Yu had only one thought: “Prepare for war.”

March 28, 1881. Baosheng, North Vietnam.

Qiao Erchi poked his head out to observe the strength of the Liu family’s warehouse once again. He carefully watched the movements of everyone at the entrance and recently concluded, “This warehouse is quite weak.”

He focused intently on everything, not noticing that Liu Yu, covered in dust, had already passed by on the roadside. He also had no idea that Ruan Youming no longer cared about them.

Ruan Youming had never been this happy. After years of disappointment and setbacks, he finally received definite news: “Within three months, the French Republic’s parliament will hold a meeting to discuss allocating additional funds to the Indochina fleet.”

He knew very well what this meant—it meant war: “The Indochina fleet will get new warships and an excellent commander.”

According to the insider information Ruan Youming had, this meeting would be presided over personally by Prime Minister Ferry, and the Indochina fleet would receive two to three million francs in funding.

The gap between nations’ strengths was evident here. Liu Yu had gone through great hardships to raise only this much money so far, while the French Republic could easily allocate two to three million francs to a small fleet in a minor theater of war.

Ruan Youming also knew what he had to do. He had to get ready. Catholics were the best allies for France in conquering Vietnam, so he needed to prepare to arm them. Additionally, the remaining members of the Yellow Flag Army also needed to be prepared. He trusted Qiao Erchi, but that didn’t mean he didn’t have other candidates.

In Vietnam, as long as there were guns and pay, it wasn’t hard to recruit troops. The key was to make plans early.

Ruan Youming looked up. The moon had set, and the stars were sparse. The darkest days for France in Vietnam were coming to an end. “Liu the Bandit, wait for me.”

Heading upstream to Shanxi, Liu Yu brought a lot of supplies to Baosheng. He knew Shanxi was his base, but it was only forty kilometers away from Hanoi—too close. So he established a secondary base in Xuan Guang, managed by Ye Chenglin’s Crow Camp. In addition, he bought two hundred acres of land in Baosheng as a backup warehouse.

This time he brought most of the heavy mortar barrels. When testing mortars at Xiliuying Camp, they naturally started with light artillery, and heavy barrels like these were prepared just in case for emergencies. Besides, he also wanted to build rapport with the officers of the Black Flag Army. With the connection through the Black Flag Bank, everyone became much closer, at least the officers were willing to secure loans for their own units. He had no idea that a conspiracy was taking shape in secret. Su Sui spoke softly, “Sisters Bingmei, how should we serve our master?” She seemed to have been gentle and kind-hearted from birth, treating everyone politely. But Su Bingmei ignored her, wiping her pistol while saying, “I’ve said it before—this time I’m in charge. The day after tomorrow, we’ll exchange these banknotes for silver and leave right away.” Unlike ordinary Catholics, she had actually killed people, and the Catholic Church nurturing someone like her surely had ulterior motives. She appeared especially cold and domineering: “We can offer sacrifices to our master tomorrow.” April 1st was the day when the Black Flag Army received its pay. As soon as the market opened that day, not a single deal had been made yet, but the price of meat in the butcher shop already rose by five coins. Everyone knew it was a good day for receiving pay, especially since it covered three months’ worth of wages—how could they not take the chance to make more money? The butcher, experienced in such things, said, “Three months’ pay at once—rare! I heard that the troops of the Qing Dynasty only get paid nine months a year. It’s not even enough to show us something special.” He was referring to Li Hongzhang’s Huai Army, which received pay every forty days, meaning nine times a year—hence the term “nine payments.” In the past, the Black Flag Army couldn’t even achieve six payments, often going through periods of plenty and scarcity. But now it was different; their pay was fully settled, and the butcher now had over seventy yuan in Black Flag banknotes. Yet just thinking about those banknotes, he muttered again, “Will this money actually be useful?” Rumors had been circulating nonstop these past few days, claiming that the Black Flag banknotes would become worthless. The Black Flag Army had even tried to suppress these rumors twice. But what if the banknotes really became worthless? He hesitated for a moment. The Black Flag Bank issued military currency and did not offer exchanges for silver or gold; one could only exchange it for silver at those warehouses, but those warehouses were all unscrupulous, making it unprofitable to exchange there. As he thought about this, he grabbed a handful of white lead coins and shook his head. Two customers approached: “Give me ten pounds of fatty meat!” In this era, with limited profits, people preferred fatty meat over lean meat, as fatty meat was also more expensive. The butcher glanced at it and quickly cut ten pounds of meat: “Two customers, ten pounds exactly!” Business was especially good today because of the Black Flag Army’s pay distribution, so prices were almost as high as during the Spring Festival. Among the peddlers, they were the most well-informed about the wealth and poverty of the Black Flag Army. The butcher’s business was even more extraordinary—just in the first half of the morning, he sold all the meat from two fat pigs. Fortunately, he had prepared an extra pig the day before. As he was delighted, he heard some rumors again.

The Black Flag banknotes in his hands were worth nearly a hundred yuan, which was almost all his savings in eagle coins. Yet he heard someone whispering, “The Black Flag banknotes have lost value—hurry up and sell them!”
“They’ve lost value! The Black Flag Bank issued two hundred thousand banknotes to the Black Flag Army, and now they’re all being sold.”
“These Black Flag banknotes are just a scam to drain people’s money—hurry and sell them.”
“I heard the French are about to go to war with the Black Flag Army. Ten million francs have already been allocated for military expenses. How can the Black Flag Army possibly win?”
Unlike other currencies, the credibility of Black Flag banknotes relied entirely on the reputation of the Black Flag Army and the Black Flag Bank. But a reputation built on bayonets wasn’t very solid. Hearing this, the butcher felt uneasy.
It’s hard for everyone—saving money is truly difficult.
Just as he hesitated, he saw several people rushing away from the stall: “Hurry to Liu’s Goods Store to exchange your banknotes before they lose value and become worthless.”
Seeing them rush off in panic, the butcher also became anxious. He dropped his butcher’s knife, grabbed the Black Flag banknotes, and ran toward Liu’s Goods Store.
In Baosheng, there were six or seven goods stores and inns that also handled the exchange of Black Flag banknotes, but none could compare to Liu’s Goods Store in terms of strength.
After obtaining a loan of twenty thousand Black Flag banknotes, Liu’s Goods Store’s business thrived even more. These exchange businesses even formed a small alliance, with Liu’s Goods Store responsible for managing funds among them.
Liu’s Goods Store wasn’t fully prepared for today’s rush to exchange banknotes. After all, they hadn’t faced such a situation in all their years of business. But since so many banknotes needed to be exchanged today, they had deliberately raised the exchange rate for Black Flag banknotes for silver in advance.
In addition, Liu’s Goods Store had prepared a large amount of cash—over a thousand taels of silver, more than three thousand eagle coins, countless copper coins and white lead coins, as well as gold, francs, pounds, and dollars.
But in this city, they were among those best informed. Upon realizing the surge in demand to exchange Black Flag banknotes, they immediately raised the exchange rate.
Exchanging for hard currencies at this rate would likely result in significant losses. But Qiao Erchi, who was observing secretly, was overjoyed. He shouted, “The Black Flag banknotes have lost value! They’ve lost value!”
While everyone was hesitant, he rushed into Liu’s Goods Store with five hundred Black Flag banknotes: “Don’t ask about the exchange rate—just exchange them all for eagle coins!”
Five hundred was no small amount, and everyone became more eager. But for Liu’s Goods Store, it was just a small sum. They proceeded with the exchange, and soon more people came to exchange their banknotes.
Just as Liu’s Goods Store thought the situation had passed, a rather beautiful woman accompanied by several bodyguards came to exchange her banknotes. She said right away, “Two thousand Black Flag banknotes—exchange them all for silver, as quickly as possible!”
Compared to five hundred, two thousand was definitely a large amount. The accountant carefully checked and found that all two thousand were genuine banknotes. It was a tough decision: “Miss, exchanging them for silver now isn’t cost-effective. I think you’d better think it over.”

“What are you thinking about! If we wait any longer, these bills will become worthless. Forty thousand yuan worth of bills—who can withstand that pressure?” She spoke in a relatively gentle tone, “Please, boss, I’m begging you!”
This wave of acceptance triggered a chain reaction. Countless people rushed in with their Black Flag bills, and even some family members of the Black Flag Army believed the rumors.
Various rumors spread throughout the city—some said the Black Flag Army had clashed with the French forces in Hanoi, while others claimed the Black Flag Bank had gone bankrupt. Fearing the worst, the citizens flocked to Liu’s warehouse.
Fortunately, Liu’s warehouse was well-resourced and had prepared enough hard currency in advance, allowing them to withstand this wave of withdrawals.
Two-thirds of the silver had already been taken, leaving them dependent on foreign currency and gold. However, Liu’s warehouse had many affiliated companies and could mobilize significant funds. Soon, a full five hundred eagle coins were deposited at the warehouse.
Seeing these funds arrive, everyone breathed a sigh of relief. Then, a quick-witted young man entered the warehouse calmly and went behind to discuss matters with the boss.
“Boss, we might not make it. Please bring General Liu and the Black Flag Bank here quickly.”
“What’s the problem? We just got five hundred eagle coins—this should last at least an hour.”
“We can hold on, but the Zhang and Bai families can’t. They’ve hung up the white flag and closed down.”
The boss exclaimed, “Oh no!” It turned out that these businesses were exchanging funds among themselves. The Bai and Zhang families had also sought help, but now Liu’s warehouse was struggling itself and couldn’t assist them.
“Bad news! The Bai and Zhang families have closed down due to withdrawals. The Li family probably won’t last either. All the pressure will fall on us now!”
Black Flag bills couldn’t be exchanged directly; they could only be accepted through affiliated companies like Liu’s warehouse. But this young man brought even worse news: “There’s already a long queue at the Black Flag Bank.”
With such rumors, people naturally didn’t go to deposit money—they went to withdraw it and then rush to drain Liu’s warehouse of funds. “It’s over! It’s really over. Go and ask General Liu to send over the silver right away!”
Outside, Qiao Erchi was ready for the final strike: “This is three batches of funds, five thousand yuan each. I don’t believe they can handle it.”
He was confident. He knew well the strength of Liu’s warehouse. It was already a miracle they had held on this long. With these three batches of funds, who could resist?
When Liu Yongfu received the news, he was discussing matters related to Xuan Guang with Liu Yu.
Xuan Guang was currently governed jointly by Wu Fengdian and Ye Chenglin, with any gains split evenly. It could also be seen as a branch base of the Xiliu Camp outside Shanxi. But Liu Yu didn’t want to be limited to that.
Of course, it wasn’t feasible to pull the Black Flag Army out of Xuan Guang. But what Liu Yu wanted was supreme command. If Ye Chenglin wasn’t up to the task, he would go to Xuan Guang himself to take control. “In that case, whenever anything happens, it will be the Crow Camp and the Elegant Building arguing back and forth. It’s fine now, but if something serious occurs, it will cause delays.”

He just wanted an explanation—to establish a supreme command authority in Xuan Guang, so as not to have two battalion commanders standing side by side, both at the same rank with no one able to command the other. Although Wu Fengdian’s forces in Xuan Guang were already under the command system of the Xiliu Camp, and Liu Yu was determined to equip them completely anew, he still lacked confidence without resolving the issue of command authority. This situation was caused by Liu Yongfu, and it had to be resolved by him. Yet he also knew that deciding on command authority meant another province falling under the control of the Xiliu Camp; although the Black Flag Army could still rely on Xuan Guang, they would become outsiders. Right now, the Black Flag Bank held Liu Yongfu’s financial resources, forcing him to say politely, “This matter requires Fengdian to come and discuss it thoroughly with everyone.” Just then, a young messenger rushed over urgently, “The general is in trouble!” He could still pretend to stay calm in front of the shop owner, but in front of Liu Yongfu, he honestly explained the situation briefly. Liu Yongfu never expected that distributing military pay could cause such a major problem. Liu Yu interjected, “It seems someone is taking advantage of the situation to create trouble!” Liu Yongfu was well aware that he had deliberately split the payment into three installments to prevent trouble, but now he had to deal with this situation. The Liu family’s warehouse was his own business; if it failed, Liu Yongfu would suffer the greatest loss. “Battalion Commander Liu, I’ve deposited 110,000 taels of silver at the Black Flag Bank as a precaution. It seems the time has come to use this money.” But Liu Yu wasn’t in a hurry. “I don’t have any control over the Black Flag Bank!”