ABSTRACT
This chapter explores the broken memory of Chinese history since the outbreak of the first stage of the Opium War from the perspective of eastern philosophical spirit and western financial rationale, in the hope of deriving a fundamental historical base for the study of Chinese banking and finance. The convergence of Chinese and western history brought an end to the seclusion of China and the country has started to increase its involvement in world affairs. Without the recognition of Emperor Qian Long, or Chinese scholars and officials, Great Britain had gained superiority over China in terms of technology and tactics. The Chinese people viewed the Opium War as only a historical accident and they were reluctant and refused to acknowledge the military inferiority and retrogressive political behaviour of the Qing Dynasty. While the Opium and the Arrow wars brought disasters and humiliation externally, the domestic revolution and rebellions gave serious blows to the ruling power internally.
