Herald of Steel

Alexander was caught a bit off guard by how reluctant both Lady Nanazin and Lady Parthia appeared about his banking business. He did not think it would be such a contentious matter.

After all, lending excess money to creditors should be an age old idea.

So it came as quite an astonishment that the Adhanian Queen was not telling him not to dip his toes into this mess while the Tibian Queen thought this was morally extremely dubious and even politically damaging.

They tried to convince him otherwise by advising,

"Alexander, if you are short on cash, try to raise them through taxes. We always felt you already charged the people too little. If you are unwilling to do that, ask some of your retainers to help you with low interest. Or maybe even just consider postponing or canceling some of the deals with the Margraves. Those will all be much better options than this!"

Looking at the sincere faces, Alexander first kept a simple face, until with a smile he replied,

"No, no, you misunderstand me, my ladies. I have more than enough cash in hand. I am not thinking of using money to bind people into bondage. I was simply thinking of giving it to some of the successful local businesses and helping them grow."

Facing all this unjust accusation, Alexander felt it was time he defended himself, quickly explaining his plan,

"Take for example when I was visiting Zanzan’s shops the other day, I noticed that many of them had more customers than they could serve. Many would even run out of inventory by noon or late noon, turning their shelves empty. This is a huge loss for the shops… every customer that left empty handed was a missed sale and thus a lost profit."

"So I was thinking instead of these shops slowly growing by accumulating profit bit by bit over years or decades, I give them all the cash upfront- letting them grow instantly." Continue reading at empire

"With this money they can buy enough goods to meet market demand, increase their inventory size, rent larger warehouses, hire more people, open up new shops around the city… you name it, all at the same time,"

"Then with all the new customers and from all the increased profit, they can pay me back some of the lent amount, while keeping the rest for themselves. And once they paid me all back.. they will be now able to make even more than they previously could have. It is a win win!"

"......"

Alexander’s reasonable and nicely packaged words went a long way for to convince the queens of his ’altruistic’ intention, and so they visibly lowered their hostility.

"... Ohhh… so it is like that?" Lady Nanazin chimed in a low, mutter, seeming a bit confused.

This was probably because much of what Alexander had said went over her.

She just did not see what was the benefit of quickly growing with loans as opposed to slowly growing over time.

’Isn’t it the same amount of money over time? Because all that extra profit will go towards the loan repayments. So where’s the benefit?’ She asked.

So Lady Nanazin was just about to further question Alexander on this when from the side, Lady Parthia let out a sort of angry snot,

"Hmmmp, leave it to you brat to make even usury seem tempting. As if I can not see how you hide that greed."

There was an unmistakable tinge of anger in her voice, as Lady Parthia made it clear she did not like the thought interest in of it itself, no matter how innocuous or advantageous it might be.

Then clenching her small fist, suddenly smirked,

"And even if your idea is good brat, I hardly think it is going to work! Because where are you going to find such businesses? No successful business wants to take loans, only struggling ones."

The skilled queen was also clever enough not to too strongly object to Alexander on ideological grounds since she could see such moral words held little sway over him.

Thus she instead chose to hit where it hurts- reality.

"....????..." And this sudden new information did cause Alexander’s heart to instantly jump a bit, ’Ahh! Could it be right? But how?’

He found Lady Parthia’s words initially quite ominous but as he thought about it and the surrounding circumstances, it quickly began to make a whole lot of sense.

"My lady is saying that most businesses prefer to use their own cash or borrow on credit to grow because the risk reward is not worth it? Hmmm… yes, I can see how many would rather let opportunities pass than ever enter into negotiations with a loan shark. Failure is too steep." řàŊỔʙÊŠ

As Alexander half mumbled the answer to himself, he found himself entering into a sort of trance, where he quickly found the reason for his oversight.

Until now Alexander had been thinking with his old world logic, one where access to capital was relatively cheap and risk free… at least you were not turned to a slave if you could not pay.

But this world had literally no existent business regulations or safety nets.

So only the boldest of businesses would dare take the risk of a loan when things were doing well.

’*Tsk*, How come I didn’t check this before?’ He quickly rebuked himself upon realizing, While Lady Parthia’s eyes seemed to twinkle a bit at the man’s swift deduction, once again impressed by the sharpness.

Then pursing her lips into a disdainful smirk, nodded, "Yes, and that is how those bloodsuckers make their money. They seek out the most desperate people in society and then rip them off right, left, and center! I hated tolerating them every second of my life."

Alexander clearly felt the anger Lady Parthia had towards loan sharks was very personal, making him wonder what loss she suffered at their hands.

But regardless of Alexander’s own thoughts, he was there to quickly show support for Lady Parthia, heavily nodding,

"Mmmm, preying on the weak and vulnerable, the bad reputation these loan sharks have is not for nothing, it was a well earned and deserved one."

He was then about to show how he was different when Lady Nanazin decided to suddenly interject, insisting with a quick bob,

’Mmmm, so it is best that you do not get involved with them. What Lady Parthia said is completely true, most businesses would not be interested in your loans. And why would they take loans anyway?"

"You will have to deal with all the extra headaches and for what? The extra short term profits will go to you anyway. As for profiting more in the long run…. what if the business fails? What if demand dries up? What if another similar shop opens up and takes the additional customers? So many things can go wrong in the meantime!" Lady Nanazin’s voice by this point had turned high pitched and sharp,

"No, taking loans is like putting the cart before the horse. All businesses are still much better off by growing slowly, reinvesting their profits, and getting bigger step by step. This is the natural way!"

Lady Nanazin was unusually firm and decisive with words, surprisingly Alexander a little.

But when he thought about it, he quickly found the reason- this thinking was very much shaped by the Adhanian Queen’s own experience.

Due to what had happened, she had an intense dislike of loans and so only saw the drawbacks. In fact, just the term repayment was sort of a source of trauma for her.

Thus she was unable to see the advantages of using borrowed capital as leverage to grow quickly.

And this time, even the usually clever Lady Parthia seemed to mistakenly agree with her, nodding her head in support,

"Mmmm, as they say Alexander, slow and steady wins the race. Businesses as just like babies, they need time and care to grow. Not just money!"

"I am afraid I completely disagree. I do not think either of you know what you are…." Hearing the two women repeatedly shoot him down, Alexander seemed to have at last lost his patience and snapped a little.

He was naturally sure he knew better and at the end of the day he was the pasha here, so whatever he said went.

But fortunately he quickly reined back such tyrannical thoughts and instead of rebuking the pair for advising him, rapidly corrected himself midway,

".... I do not think you are able to fully appreciate the advantages of loans. So let me show you…"

"By using the loans businesses can grow quickly. They can open new shops all over the city and attract more and more customers until all the available people come to only them."

"And if anyone new tries to compete lured by the profits, they can lower their prices and even sell at a loss for a time… using those loans to cover their operating costs in the meanwhile. Then when all the new competition is driven away after being unable to compete, they can raise the prices as much as they wish, thus covering the loan repayments and then some."

"Imagine there is only a single butcher in the city. If people want to eat meat, they will have to buy meat from him no matter the price.

Let us say no to piracy! Don’t take part in a crime! Don’t patronize thieves!

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