two centicreds

In the thread called "reparations" (and elsewhere) people suggest the economic collapse we are waiting for will include the devaluation of the solarian credit. Will it?

The credit is the Solarian League's members' standard monetary unit. A search on "currency" gives a good idea on what people think will happen--that the currency will collapse.

But the League isn't an 18th,19th, or 21st century political construct; while member systems may have their own currencies, for intersteller transactions they are accustomed to the Solarian Credit.

So--is it a federal thing that only exist because of the League? or is it a mutual thing that is currently administered by the League and may survive it (preserved by the will of system governments and the bankers that prop them up)?

While I expect the federal system to break down, I wonder whether the need for a mutually agreed on means of exchange means currency control will devolve onto the local and regional banks, but leaving most of the overall finance system intact?

Reason I am asking is the repeated use of Banco de Madrid as the source of real (and, counterfeit) credit voucher-chips-cash. If the individual currency exchange is guaranteed by the issuing banks, then the currency retains its value (unlike things, like, Treasury bonds).

This could end up being a dozen regional different systems, or the communications and local banks (and local governments) try to preserve as much stability as possible.

You still get the economic pain in the short term, but the recovery might be quicker.

So--I'm wrong? right? confused?


Rob

Really good questions, and I think that the interstellar banking world goes no untrammelled no matter what, at least for long enough for the e.m.m. to mess things up, if that's part of their agenda.

What dries up -- I think, is the Mandarin's and OFS/etc. ability to pay for anything without direct taxation. Something along the lines of "Oh, so you want to buy x gazillion cataphract's from evil industry arm supplier, that will be x million gazillion solarian credits. What? no money? no missiles for you!"

*[what's the emm? evil mesan menace, my new shorthand, ]

SharkHunter wrote:Really good questions, and I think that the interstellar banking world goes no untrammelled no matter what, at least for long enough for the e.m.m. to mess things up, if that's part of their agenda.

What dries up -- I think, is the Mandarin's and OFS/etc. ability to pay for anything without direct taxation. Something along the lines of "Oh, so you want to buy x gazillion cataphract's from evil industry arm supplier, that will be x million gazillion solarian credits. What? no money? no missiles for you!"

*[what's the emm? evil mesan menace, my new shorthand, ]

a lot depends on whether the Sollie treasury can just issue bonds or notes to cover the "temporary deficit." Just how much they might be able to borrow is up to the author.

But the Bank of Manticore is a lynchpin for the banking industry, so killing the Solarian credit would be another way to damage Manticore's own recovery. there is a fairly lengthy Pearl about how it works.

Rob