Chapter 46: The Great Fundraising Plan
A mere member of the Night's Watch, yet commanding the Hand to write a written proof as if he were a king. Aeg had taken advantage of the lowered guard due to his black cloak, but as he left the Hand's Tower with the proof bearing the wolf's head seal, he couldn't help but marvel inwardly: it turned out that, with the right method, these high and mighty nobles could be deceived just like anyone else.
No wonder Littlefinger could thrive in King's Landing, playing the Baratheons, Starks, and Lannisters like puppets.
Lies, indeed, were effective.
By the time they returned to the inn, the sky had darkened. Aeg didn't drag Yoren around anymore and rested obediently in his room for the night, welcoming the second day of his life in King's Landing.
"Yesterday, you went to Eddard Stark and asked for two men, a room, and a proof. Remember?" Tyrion's eyes sparkled with curiosity. Based on two months of experience, there must be some trick to this, and Aeg's explanations always broadened his horizons. "I can understand the first two things, but what's the use of the proof?"
"To deceive money."
"Deceive money?" Tyrion was taken aback. "If Eddard Stark finds out you're using his signed proof to deceive money. Well, he may not have the authority to deal with you, but with just a letter, you could be recalled immediately."
"Yesterday, when we arrived in King's Landing and passed through the gates, you made a comment about the 'Hand's tourney.' Do you remember?" Aeg did not directly respond to Tyrion's warning but instead brought up another matter. "There was one sentence I agreed with. these events bring prosperity to the kingdom. The Iron Throne, at the cost of being heavily in debt, made both the participants and the spectators, as well as the merchants, very happy. The king did spend a lot of money, but this money did not disappear; instead, it circulated and stimulated economic development before ending up in the hands of the people, merchants, and winners. Whether he intended it or not, the king's extravagance was not entirely harmful."
Tyrion did not interrupt. He was curious to hear what his adventurer friend from Qarth thought differently about Robert Baratheon's extravagance.
"However, a large portion of this money stops its journey there. The people of Westeros are too fond of hoarding money. the rich hoard gold, the commoners hoard silver, and the poorer ones hoard copper. Unless necessary, they would rather hoard it until death or it is stolen away. After the money is spent by King Robert and ends up in the hands of the people, at least half of it is thus hoarded and does not re-enter circulation for a long time. this is very harmful to social development. Now, I want to deceive this money out and make it work."
"I've heard similar arguments from a maester in Oldtown, and it's the same as what you're saying. gold piled in a treasury is no different from stones." Tyrion looked up at Aeg. "The circulation of currency can prosper the economy; everyone understands this. But the irregular seasons and wars make people worry about tomorrow. Without changing this situation, you cannot convince people to spend their money just by talking."
"Changing the entire consumption mindset of the people of Westeros is a bit far-fetched; I'm not that ambitious. I don't ask them to spend their money; I only ask them to be willing to lend it to me." Aeg smiled. "People hoard money because they are afraid that once it's spent, they won't be able to earn it back. But what if I tell them that as long as they lend it to me, the money will automatically grow?"
Tyrion caught the loophole in Aeg's words. "You say 'you tell' them, which means you actually have no way to really make money grow."
"Indeed, at least not temporarily, but once I find a way, I can." Aeg said, "Before that, I will first convince people that lending me money is profitable. the method is to pay back a little more when repaying the loan."
"Interest."
"Indeed, the interest is higher than the standard lending rates," Aeg explained, his voice steady and convincing. "For instance, one percent per month. If you were to lend me a hundred gold dragons today, in a month's time, I would repay you a hundred and one."
"But where does the extra gold dragon come from?" Tyrion inquired, his brow furrowed in confusion.
"From those who haven't demanded immediate repayment," Aeg replied smoothly.
Tyrion's words were a puzzle to the residents of Westeros, a land where banks were scarce, and the concept of investment was foreign. Yet, Tyrion, ever the quick-witted, pressed on. "But won't this scheme eventually unravel? What if everyone demands their money back at once?"
"A valid concern," Aeg acknowledged. "Should that occur, it's known as a 'broken chain of funds.' Not only I, but even the mighty Iron Bank could face immediate bankruptcy. My task is to prevent such a scenario."
Aeg continued, "I employ certain rules and incentives. such as no interest for early repayment within a month, an increased interest rate of one and a half percent for longer loans, and resetting the terms upon withdrawal. to manage this."
"But without an actual increase in funds, the truth will inevitably surface!" Tyrion countered.
"Inevitably? Many things are inevitable," Aeg said with a shrug. "People will die, dynasties will fall, the world will end. As long as I can postpone that day indefinitely, pushing it into a distant future I may never see, how is that different from it never happening at all?"
"That's mere sophistry, Aeg," Tyrion said, his expression taut with disapproval. "Don't pursue this path. It's better to be practical. If this ever comes to light, no one will be able to save you. If you're in need, my own funds could suffice."
Aeg felt a wave of helplessness wash over him. He had expected someone as intelligent as Tyrion to be more receptive to innovative ideas, but it seemed his plan was still too avant-garde for this world. He needed a new strategy to convince him.
"What I've shared is merely the initial phase of my plan," Aeg explained. "You're right; as the scheme progresses, I'll need to find ways to genuinely increase the funds, such as investing in guilds or expanding the Night's Watch fleet to boost trade across the Narrow Sea. Real profits will cover the interest."
"Assuming there are no missteps in the beginning," Tyrion noted.
"Precisely. And there won't be any," Aeg assured him. "With the endorsement of the Lord Commander of the Night's Watch and the Hand of the King, and borrowing in the legion's name rather than as an individual, I may not secure a vast sum, but it won't be negligible either. Once I repay the first round of loans with principal and interest, it will instill confidence. no, credibility. among my investors, or rather, creditors. Everything thereafter will flow more smoothly. Tyrion, what's the maximum amount you could contribute?"
"Less than a thousand gold dragons, with four to five hundred earmarked for your ransom from the Night's Watch. Since I've already agreed on the types and quantities of supplies with your chief steward and craftsman, I can only hope prices haven't soared since I left King's Landing."
"Understood. With three hundred gold dragons, we could purchase supplies to sustain my freedom for a few more months or even initiate obsidian mining."
"I'll see what I can do. My brother has some wealth and spends little. If needed, I could approach my father for more. It won't be a substantial amount, but it won't be insignificant either." Tyrion firmly interjected, "However, deception is dishonorable. I cannot assist you with this plan."
The silence hung heavy in the air as Tyrion's serious and unyielding expression made Aeg realize his mistake. At the outset, he had jestingly referred to his endeavor as "deceiving money," but it had backfired, leading Tyrion to view it in a negative light.
Inwardly, Aeg cursed his poor choice of words and swiftly contemplated how to rectify the situation.