Financing

Discussion in 'Debates & Discussions' started by Dragon, Feb 8, 2021.

  1. Dragon

    Dragon Level 18 (Magician) Exiles Beta Reader Citizen

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    Should Richter be borrowing money from the banks in order to hire more people and buy more items he needs such as schematics? Most of the time people won't sell those, but most of the time people aren't offered several thousand gold for one either. The sweet smell of money opens doors no amount of knocking or force can open.

    With the village realistically being able to earn several thousand gold in profits a year - to start - and with them being able to scale it at least to some degree, there seems to be an opportunity here for a businessman, a trader, a financier. Simply lend out the money in return for say a 22% interest rate - Richter is some weirdo living out in the forest, high risk of him running off or getting killed by bugbears. High risk means high reward - as well as a monopoly on the weapons trade to Yves.

    In return Richter would have the money he needs to finance a rapid expansion. As long as things go his way in the war his economy will easily outgrow the interest
     
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  2. Mister Bill

    Mister Bill Level 12 (Rogue) Exiles Beta Reader Citizen

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    They could run it out of that village on the empire’s border that he went to before. But who would risk that money? And why wouldn’t Richter just straight up sell stuff for money/things he needs instead of getting taken by a high interest rate? Unless we’re gonna make a comment about poor people and payday loans. Which could end up funny.

    I think he’d just continue to do his thing, especially as I doubt a financier would lend him tens of thousands. And I also assume you’re not talking about one of the Core Banks.
     
  3. Dragon

    Dragon Level 18 (Magician) Exiles Beta Reader Citizen

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    I was thinking more of a localish backer, perhaps a major merchanthouse in Rione, Yves, or one of the elven realms. Maybe the dwarves will be willing to pour their treasuries into the village in return for certain concessions.

    A business loan is a different fish from any type of consumer loan. Its profit vs interest. Rule of thumbs, if you can earn more money from the loan than you spend maintaining it, both sides will win.

    Businesses breathe debt the way we breathe air, without it a business will grow at a fragment of its potential speed. Financing allows for new facilities to be built, more workers to be hired, more resources to be brought home, which leads to more income and in the end greater profit for the owner.
     
  4. PokemonThug

    PokemonThug Level 14 (Defender) Roleplaying Exiles Citizen

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    Well as far as it goes for stonk options, if ur 99% certain on your bet/investment's return you go all in.
    So if ur goin all in and expected return is 40x or 4000% in a yo or so.
    Sure borrow, steal, threaten, beg and get as much as u can.
    f.e
    : loan gold, diamonds, opals, whatever form Hearth mother, use as leverage with brokers,
    promise of long lasting trade for decades,
    promises of alliances,
    we don't have to f.e. trade real assets for loans..
    get a loan for the land(not a super great idea but in the end they will want collateral)
    and get a loan for like a semi valuable asset, not real thing, like rare fruits or ingredients, but not super rare.
    they don't have to know that ur mining tons of gold, then sell this intel to the King and ur village will be killed for it.
     
    Last edited: Feb 10, 2021
  5. Johan

    Johan Level 17 (Theurgist) Exiles Beta Reader Citizen

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    i always found it interesting that the white pearl group did not want to reinvest his money or anything like that.
     
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  6. PokemonThug

    PokemonThug Level 14 (Defender) Roleplaying Exiles Citizen

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    healthy fear of broken ankles lol
     
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  7. Mister Bill

    Mister Bill Level 12 (Rogue) Exiles Beta Reader Citizen

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    He’s ballin’ out there?
     
  8. Captain BlackJack

    Captain BlackJack Level 15 (Guardian) Exiles Citizen

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    I can see entanglements of laws in regards to lending and finance in the Land. With Banks being as powerful or more so then kingdoms they would likely have some influences on any lending and financing. Some countries might even have laws against usury.
     
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  9. Dragon

    Dragon Level 18 (Magician) Exiles Beta Reader Citizen

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    Maybe. If such laws are in place that would mean another big advantage for Richter when competing against those economies.

    Its quite difficult to rapidly build up a business if you can only borrow money from friends and allies. Not to mention maintain said business during times of trouble.
     
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  10. Mister Bill

    Mister Bill Level 12 (Rogue) Exiles Beta Reader Citizen

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    I think it’s a kind of society that’s happy to make it difficult on upstarts. Just look at how information is hoarded. The ancient families and clans and such would be best off.
     
  11. Captain BlackJack

    Captain BlackJack Level 15 (Guardian) Exiles Citizen

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    Mr Bill you are right. Similar to our own history and even modern times. Knowledge is power. In history most if not all the ruling powers tried to retain power at all cost. That not only means keeping Land and wealth in the family. It means keeping knowledge of things closely guarded as well. The more knowledgeable people are the more ability the have. Sometimes those abilities are turned against the powers that be. Books were also rare as they were all handwritten. The extreme cost of handwritten books made it impossible for most to gain access to books of any sort. Bibles had been stolen so many times out of churches that the church started chaining bibles down in attempts to prevent Vikings from stealing them for ransom.
     
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  12. Dragon

    Dragon Level 18 (Magician) Exiles Beta Reader Citizen

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    Information is hoarded all the time in our world as well. People rising up from amongst the lowest classes likely happen more often than it did on earth due to skill affinities. Discovering a high affinty would mean the difference between a serf living a life of stability and poverty vs being able to learn a trade.

    Take the scholars for example. They signed away years in servitude to the guild, but in return they got valuable training and a chance at real prosperity once they've worked off their contracts.

    Returning to industry, most of the land-, production- and store owners likely come from wealthier families. But even they won't have that deep a purse, due to most of their wealth being tied to land and businesses, rather than a chamber filled with silver pieces. They have a need for someone who can supply coin in return for payment. That someone will in turn need guarantees of some sort.
     
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  13. Mister Bill

    Mister Bill Level 12 (Rogue) Exiles Beta Reader Citizen

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    Yeah, AFAIK it would take a monk a year or longer to copy a book (and they had a bunch they kept around through their efforts), I hadn’t heard about chaining them and ransoming them, though.
     
  14. Mister Bill

    Mister Bill Level 12 (Rogue) Exiles Beta Reader Citizen

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    Good point about the need for a banker. Might be a part of the larger organizations and guilds and such.
     
  15. PokemonThug

    PokemonThug Level 14 (Defender) Roleplaying Exiles Citizen

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    Knowledge is Power! However if u don't use and abuse it it is Worthless!
     




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