“You’re a poor investment risk,” Caleb gibed.
Emily ignored him. “We write the terms of the loan down in a promissory note,” she added, carefully. “I could then sell that note onwards to Caleb…for eleven crowns, perhaps. Caleb then makes a profit of four crowns when you pay him the full fifteen.”
“Except you would have given up a profit of four crowns,” Frieda said, slowly. “Why would you do that?”
“I might need the money before the note came due,” Emily said. “You wouldn’t be paying out the full amount before then.”
“Assuming you can pay,” Caleb pointed out. He sounded disturbed. “What happens if you can’t pay? What happens if you don’t have anything to cover the cost?”
The burgers arrived before Emily could think of an answer. They were huge, cooked to perfection and slathered with melting hunks of cheese. The server brought them a small collection of condiments and a basket of oversized chips, then hurried away again. Emily reminded herself, again, to be careful with the sauces. They were nothing like the ones she’d used at home.
Healthier, though, she thought. But we might have to skip dinner.
“I don’t know what would happen if someone couldn’t repay the loan,” she said, slowly. She tested the burger, just to make sure it was safe to eat. “If they didn’t have anything that could be seized…”
“They’d be in some trouble.” Caleb picked up his burger and took a careful bite, then a larger one. “Ten thousand crowns…how many of his bills are coming due?”
Emily winced. If she was right – and she had no reason to think otherwise – Vesperian was borrowing money to repay the first set of loans, rather than investing it in his railway. Ten thousand crowns could repay a lot of debts, as well as convincing some of his creditors that there was no need to panic and demand repayment. He might even be able to use the sudden influx of money to get more loans.
But the wheels will fall off, sooner or later, she thought. Vesperian and his investors were playing musical chairs for high stakes. When the music stops, and it will, who’s left out in the cold?
She’d seen it happen, back on Earth. Someone took out a loan, then another loan, then struggled to repay the interest…sinking further and further all the time. She’d known people who had been so deeply in debt that they hadn’t had a hope in hell of escaping. And they’d dealt with relatively small sums of money, hardly noticeable to the banks and credit card companies. What would happen if a giant corporation went the same way? It would be a nightmare.
“I don’t know,” she said. “And without further information, I’m not going to invest.”
“Mother banned Karan and Marian from investing,” Caleb said. “She told them they weren’t allowed to use any of their allowance to invest.”
“I don’t blame her,” Emily said. Karan and Marian would be annoyed, she was sure, but she suspected their mother was right to be wary. There was no way either of the girls would be counted amongst the major creditors once the hammer fell. “How did they take it?”
“Poorly,” Caleb said. His face twisted. “Their friends are bragging about scoring good deals, and they’re out in the cold.”
“They might have the last laugh.” Frieda dunked a chip into something that smelled like Tabasco, then nibbled it thoughtfully. “What happens if their friends don’t get their money back?”
Emily shrugged. A schoolchild’s allowance was nothing, in the grand scheme of things. A handful of cents wouldn’t amount to much. The teenagers would be embarrassed and humiliated, but there wouldn’t be any major consequences beyond annoyed parents…would there? She found it hard to believe that anyone in Beneficence would give their children that much pocket money.
“They’ll be laughing,” Caleb predicted. “And their friends will be hurt.”
“We should investigate.” Frieda looked up, interested. “How far can this possibly go?”
Emily considered it, carefully. She’d read about financial bubbles, but most of the details had slipped her mind. Even a relatively low-tech society could have a sudden upswing in share prices, followed by an equally rapid crash when the shareholders realized their mistake and tried to withdraw their money before it was too late. What would happen if investors realized Vesperian couldn’t repay them?
It would be bad, she thought, numbly.
“I don’t know,” she said, finally. “It would depend on too many factors.”
She forced herself to think.
How much did Vesperian actually own? His mansion…did he own it? If he was renting the building, there was no way he could sell it to recoup his losses and repay his investors. The railway and its rolling stock? Or…what else did he have?
She didn’t know. But she did know was that the only people who came out ahead in a pyramid scheme were the ones right at the very top.
“Don’t invest,” she said.
Frieda laughed.
“Good advice,” Caleb said. “I just hope my sisters listened.”
He paused. “I hope Casper listened,” he added, after a moment. “He was certainly old enough to make his own decisions.”
“I don’t think he would have had enough money to make a difference.” Emily took another bite of her burger, enjoying the taste. “Did Master Grave give him an allowance?”
“I don’t know,” Caleb said. He grinned. “Did Sergeant Miles give you an allowance?”
Emily shook her head. It had never occurred to her to ask for one. She’d taken enough cash with her to meet all her personal needs, given that the army supplied the sorcerers and their apprentices with food, bedding and everything else they needed. And she’d never been one to gamble. It wasn’t as if the other apprentices had invited her to any high-stakes games.
“He could have asked our parents for an advance on his inheritance,” Caleb mused. “But I don’t think they would have agreed.”
“Probably not,” Emily said. “How would that have worked?”
“Poorly,” Caleb said. “He was the Heir, after all.”
Emily met his eyes. “What did your mother say to you?”
“Nothing I can talk about here.” He shot Frieda a glance. “But we do have to talk.”
“I’m sure I can trust you to behave,” Frieda said. She glanced from Emily to Caleb, then looked at her watch. “There’s a train due in thirty minutes. I could wander off afterwards, leaving you two alone.”
“Thank you,” Emily said. She knew Frieda meant well, but her constant supervision was annoying. “We won’t do anything stupid.”
“Vesperian must be getting desperate,” Caleb mused, as he finished his burger. “I would have expected him to send you a formal invitation to dinner, not have one of his flunkies accost you outside a bank. It smacks of something put together on the spur of the moment, rather than a carefully thought out plan.”
Emily nodded. She hadn’t thought about it like that, but Caleb was right. By any reasonable standard, Vesperian should have wined and dined her before requesting a loan…and, perhaps, put together a better case. It sounded more like he’d taken advantage of an unexpected opportunity rather than planning everything down to the last detail.
Frieda had a different thought. “Did he really expect you to write him a bank draft at once?”
“Maybe.” Emily had met enough aristocrats to know they didn’t bother to pay much attention to money. A baron might run short of ready cash, but his lands and properties would eventually refill his wallet. And if he needed the money quickly, he could just squeeze the tenants until they pleaded for mercy. “Or perhaps he thought the mere promise of the money would be enough to save his bacon.”
She finished her burger and rose, carefully concealing a tip under the plate. The waitress would scoop it up before anyone else arrived. “Let’s go,” she said. “I want to see the railway.”
Chapter Ten
“IT’S GROWN,” CALEB SAID, AS THEY entered the station. “It was much smaller, the last time I visited.
”
Emily nodded. Beneficence Station was larger than she’d expected, a combination of platforms, sheds for rolling stock, and roving salesmen trying to sell everything from shares in the railway to food and drink. Uniformed conductors walked everywhere, supervised by a fat man in a top hat and black waistcoat. Emily was disappointed to realize that people couldn’t get onto the platforms themselves without a proper ticket, although she understood the problem. There were too many spectators for it to be safe.
She looked from side to side, shaking her head in amusement. Vesperian had covered almost everything with his giant ‘V,’ save for a handful of advertisements and a giant portrait of himself. Almost all of the advertisements were for guildmasters, urging guildsmen to vote for free trade candidates. Emily wondered, absently, if Vesperian had banned any other candidates from advertising in his station. She rather suspected he had. Someone more inclined to raise trade barriers would not find favor with him.
Frieda nudged her. “Here it comes!”
Emily smiled at the note of excitement in Frieda’s voice – and the crowd’s intake of breath – as the steam engine slowly came into view. Steam billowed up from the south, growing closer and closer until the locomotive itself appeared, half-hidden in a cloud of smoke. The whistle blew as the train roared past and headed into the station, pulling four large carriages to the platform. Emily had to admit that steam technology had improved over the last couple of years. Earth had taken decades to make the same leap.
But they didn’t have my half-remembered diagrams to point them in the right direction, she thought, as the train came to a halt. They had to progress by trial and error.
The whistle blew, again. She tilted her head, watching as the doors were opened from the inside and the crowd poured out. Most of them looked like merchants, but a number were clearly peasants from Cockatrice. The idea of going on a holiday, even a mere two hundred miles from home, would have been alien to them, once upon a time. Now…she wondered, absently, just how many of them would never go home. There was always work for willing hands in the big city.
“It’s impressive,” Caleb said. “And there’s no magic in it at all.”
Emily shrugged. Some of Paren’s early designs had included a spell to keep the boiler from bursting, if the steam ran right out of control. She had no idea what Vesperian – or his designers – had included. A handful of simple runes might make the difference between success and failure. She heard a grinding sound and turned to watch, just in time to see the engine moving away from the coaches. Unless she missed her guess, there would be a set of points – further into the station – that would allow the driver to turn the engine around and move it around the coaches. The engine practically vanished in another whoosh of steam as the driver moved it away, quickly. Seconds later, another engine appeared on the far side and was quickly hooked up to the coaches. It looked as though there were quite a few engines in the sheds.
“It is impressive,” she agreed. There was so much energy in the station that it was easy to believe Vesperian’s Track could reach all the way to the Iron Hills. Young men lined up in front of a recruitment office, clearly hoping they’d win one of the coveted driver positions. There were even a couple of young women! “But can it make money?”
They walked through the station, allowing her a chance to look around. Prices were relatively low, something that puzzled her until she realized that most of the first investment had already been sunk into the infrastructure. Besides, low costs would encourage more travelers. Large placards talked about how the track’s expansion would bring a new era of economic development to Beneficence, a boom that would never stop. Emily knew that was a lie, even if all the political and financial barriers suddenly vanished. There were limits to how far the boom could go.
Here and there, she spotted people who looked…concerned. They hid it well, but their faces were pale and they spoke in low voices. Others muttered angrily, seemingly unconcerned about listening ears. She picked up enough to know that matters weren’t as settled as Vesperian had suggested, although she wasn’t sure of the details. There were costs and cost overruns and unanticipated side effects…
She heard the engine puffing out of the station behind her. She didn’t look back.
“You could probably get a tour,” Frieda said. She jabbed a finger towards another line of youngsters. “They’re getting a tour.”
Emily shook her head. “I don’t think we’d be told anything useful.” Her name could probably get them a private tour, if Vesperian still thought she might loan him money. “I’d be astonished if they talked about any problems.”
A young woman materialized in front of her, carrying a large manuscript book. “I’m selling notes,” she said, giving Caleb a sweet smile. Emily felt her hackles rise in irritation. “We’re offering sixteen for twelve, repayment due in two years.”
“Two years,” Frieda said. She smirked. “And what happens then?”
The woman’s mask dropped, just for a second. She looked younger, probably no older than Frieda herself. Emily felt a stab of pity, despite her earlier annoyance. Unless she missed her guess, the woman was only paid in commissions. Vesperian – intentionally or otherwise – had created a pyramid scheme.
“Don’t listen to her,” someone snarled. Emily turned to see an older man, carrying a bottle of beer in one hand. “I can’t get a decent price on iron because of that…that…”
He waved a hand at Vesperian’s portrait, beaming benevolently down on the assembled crowds. Emily gritted her teeth, unsure what to do. More and more people were turning towards them, some heckling and catcalling the older man while others seemed inclined to support him. And then two burly private guardsmen pushed their way through the crowd, grabbed the older man and marched him off to the entrance. Emily allowed herself a moment of relief as the crowd started to disperse, then followed the guards.
“Come on,” she hissed. “I want to talk to him.”
The guards pushed the older man out of the entrance, then stood there until he started to head down the street. Emily made her way past them, followed by Caleb and Frieda. The older man turned to look at her, his gaze flickering over her face without a hint of recognition, then started to look away.
“I need to ask you some questions,” she said. “Can we talk?”
“Maybe.” The man grunted and looked down at the bottle in his hand. “You’re too pretty to be a whore and too forward to be a wife. You must be a magician.”
His eyes landed on Caleb. “And you’re the general’s son. What do you want?”
“To talk,” Emily said. She glanced at Caleb. He didn’t look pleased, either at being recognized or the man’s comment to Emily. “Please.”
“Polite, too.” He walked over to a bench and sat down. “Anything for the general’s son.”
“Thank you,” Caleb said, tartly. “And you are?”
“Jack,” the man said. “I was a soldier, once upon a time. Your father was my commander. He actually knew what he was doing, unlike the weak-chinned blue blood they landed us with afterwards.”
Emily cleared her throat. “When you said you couldn’t get any iron,” she asked, “what did you mean?”
“I meant I couldn’t get any iron,” Jack said. “Or wood. You can’t get the wood, you know.”
He snorted, rudely. “The army performed a remarkable spell and turned me into a blacksmith. I’ve been a blacksmith ever since. I used to make swords and horseshoes and everything else the troops needed. And then I came here and started my own business. Not that I ever got much money out of horseshoes!”
“No horses here,” Frieda said.
“Not many.” Jack agreed. He glared towards the station. “I found a wife, had a couple of little ones, things looked good. And then that man--” he spat “--started building his railway and soaking up all the iron. And just about everything else! Every blacksmith in the city is running out of iron because that man is driving prices up and up and up and u
p…”
He looked down at his bottle. “It’s happening everywhere,” he added, softly. “Fishermen can’t get the supplies they need because the railway is consuming everything. My customers are going away because I can’t give them what they want. And when I complained, they had the nerve to suggest that I should go work on the railway. That man destroyed my life, and they want me to work for him!”
“I’m sorry,” Emily said, quietly.
“It wasn’t your fault, missy.” Jack jabbed a finger towards the station. “It’s that man’s fault!”
He laughed, bitterly. “They keep promising that the railway will take us to a land of milk and honey,” he added. “Where iron will be so cheap that everyone can have a suit of armor…hah! They’ve got one line. How are they going to finish it when they can’t get the iron to complete the next set? Or make those moving kettles? Or…”
Emily nodded. Jack had a point. If Vesperian was driving prices up – and he was, because all the sellers knew he needed their wares – what was it doing to everyone else? What other effects would it have?
Her blood ran cold as she considered the problem. What if most of the fishing boats were unable to fish? The city might run out of food.
They could go back to wooden boats, she mused. But if the price of wood is also being driven up…
“I can’t meet my obligations,” Jack said, breaking into her reverie. He shook his head. “I’ll be taking my family out of the city in a week or so, I think. Better to go to Cockatrice or Swanhaven than see my little girls turned into slaves. I’ll strip the forge bare, sell what I can and go.”
“My father would help,” Caleb said, awkwardly. “He…”
“Might feel obliged to report me instead,” Jack said. He laughed, humorlessly. “My wife came here to get away from some nobleman who was sniffing around her. Brute thought he was being all noble and such when he didn’t just force her into his bed. But now we’re going back in that direction. There’s a baroness in the castle now. At least she won’t be chasing my daughters.”
Fists of Justice (Schooled in Magic Book 12) Page 10