Member Worlds and Imperial Credits

[rancke]

The major point raised in this topic about local worlds not being able to print their own currencies is, I think, the key issue in why worlds would create their own. I don't personally like the added complexity, and so I personally rule that almost all worlds tend to accept the Imperial credit directly as legal tender.

The two are not mutually exclusive. A world can accept Imperial currency and still print its own. Indeed, in my first post in this thread, I said that I think acceptance of Imperial currency is one of the boilerplate clauses of membership treaties.

Also, IMO, after many centuries of existence, most planet's currency exchange rate with the Imperial credit doesn't change much except in cases of local wars or political upheavals. This tends to mean that as far as the GM (namely me) is concerned, I do not worry about creating price differences on every world due to currency issues (maybe for Amber and Red Zones).

Ignoring the issue completely except for local color? Works for me.

As I stated, I read it differently than you. The direct implication is that it is discussing colonization. By exactly what party within the Imperium, it doesn't say, but whether the Imperial government itself, or independent parties within it, they would have still had the Imperial credit.

No it is not the direct implication. It discusses scout activity, exploration and contact (building bases would be in support of the other activities) That means it discusses the kind of things the IISS was supposed to do, so it's pretty likely that much of the described activity was performed by the IISS.

I never had that issue. (I only possess a handful of Traveller's Digest issues, like two or three)

Well, now I've told you. If you doubt my word, there are no doubt others who can tell you that the quote is accurate.

I am not clear what you mean, here. The other megacorporations wouldn't have been involved, so stating that the others wouldn't have been stolen appears non-sequitur to me.

Zhunastu Industries didn't belong to Cleon I. It belonged to the shareholders, including an unspecified number of Cleon's relatives.

Because I think that Cleon I organized it so that his assets were the Imperial Family's assets.

And I think he didn't. That's not evidence, that's opinion.

When Cleon II abdicated, he left behind control/ownership of Imperial Family assets to his successor, as originally intended. He may have retained non-voting shares and other financial incentives after abdication, but control/ownership of Imperial Family assets passed to the successor to the Imperial Family position, the new Emperor (Artemsus).

Absolutely no evidence for this notion. And doing so would steal the other shareholders' part of the corporation from them.

Reading again the description of Cleon II's abdication and life after also reinforces my opinion. He would not have taken the control/ownership of those corporate assets with him.

He would not have taken over as CEO, no, but he wouldn't have been CEO before his abdication either. He would have taken the ownership of the corporation with him, because it belonged to the Zhunastus and he didn't abdicate being a Zhunastu.

Cleon the Mad would have only obtained theoretical control in 244, and he was killed in 245.

Again, no evidence for that, but it doesn't affect the particular point you're leading up to here. Cleon the Mad would not have started killing off his managers until after he became emperor. So he only had less than 24 months to do so. (Except that any orders he may have given for dealing with matters in the provinces would be carried out even after his death).

I always had the name changing away from Zhunastu Industries (no idea where I got the "Heavy" from, my apologies) so that the Third Imperium could move forward and memories of what Zhunastu Industries did along the way to empire could be more rapidly forgotten.

Yes, that part is not a problem (Except for being contrary to canon; Milieu 0 makes it clear that Zhunastu Industries and the other companies in the Zhunastu Conglomerate continued to exist in the form and under the names they'd had before the Imperium was established. Well, they did get Imperial charters, so they stuck 'LIC's after their names). But what happened to the company?

The first statement says that ZI could not be sunk. The second says it's not around anymore.

It was an attempt to anticipate a quibble. The Civil War is the one other time where Imperial control might slip enough to founder an Imperially-owned megacorporation.

Just because something isn't discussed doesn't mean it doesn't exist. It just means there is no canon information about it.

In many cases that is true. In this case, where we have an exhaustive list of all Imperial megacorporations in the Classic Era, it is absolute proof (not just strong evidence) that no such megacorporation exists in the Classic Era.

The very idea the the emperor of the Third Imperium doesn't have gigantic corporate assets in direct ownership through the position of emperor just seems unlikely to me.

The Imperial family has a massive portfolio. It just doesn't have a family megacorporation.

One year of late-model madness is hardly sufficient.

On what evidence do you base your estimate on how long an emperor needs to kill off large numbers of people? Caligula began his major killings in 39 (I can't find a day mentioned) and was assassinated on January 24th of 41. He did begin executing people without full trials in 38. More time than Cleon the Mad had, true, but how can you possibly know that 9 or 10 months of full-blown madness wouldn't be enough? I certainly don't believe it takes more than a few seconds to order someone's death. Do you?

[Non-canon: In one of my games I put in an off-hand reference to the Holiday Massacre without elaborating on it. My idea was that Cleon started out well enough, and build up his madness as he went along. His first major display of insanity was to invite a large number of his secret enemies (as he believed them to be) for a feast on Holiday 245 and seat them in one hall and then have them all killed while he feasted with his sycophants in another hall.

From then on I think things went from bad to worse until he was finally assassinated late in 245.]

Everyone around him could see he was an issue, and if they were plotting against his life, they were foot-dragging against his orders soon enough.

When did they start plotting against him? Assasinations tend to benefit from speed. Caligula was allowed to muck about for two years or more before he was assasinated.

That was what Cleon I did with the worlds of the Imperium, give them away to his supporters. I doubt he gave away the primary source of his wealth, his own company, to anyone else. I strongly doubt it.

Cleon I didn't give any worlds away to anyone, since they were not his to give away and he was trying to coax the owners to join up. And of course Cleon I didn't give away ZI. That's why his shares would have belonged to his son personally. Why wouldn't he? It's not as if it's at all likely that he'd anticipate his unborn son abdicating, is it?

And all this doesn't address the total mystery of why Cleon I would organize ownership of his family business in a way that would make it easier for a non-Zhunastu to take over the throne.


Hans

 

[Dragoner]

LKW was the line-editor, knows as much as anyone about the OTU except Marc, and he approved the text of GURPS: Far Trader, which flatly states that there is no central bank of the Imperium and why.

I did mention that their opinions were not minor ones as far as I am concerned.

You can not have a currency without a central bank, it is basic economics, whoever said what, it is wrong, no matter what their opinion, either that or it's being read wrong. The Second Imperium didn't fall because of the banking issue, it was just the harbinger of it's fall. GURPS is largely meaningless to me and if what you said is true, it speaks poorly of the material.

Also, IMO, after many centuries of existence, most planet's currency exchange rate with the Imperial credit doesn't change much except in cases of local wars or political upheavals. This tends to mean that as far as the GM (namely me) is concerned, I do not worry about creating price differences on every world due to currency issues (maybe for Amber and Red Zones).

In reality, it would be in constant flux, but it would be too complex to figure given the paucity of data. However people want to play it is fine, it is just not realistic at all.

 

[rancke]

You can not have a currency without a central bank, it is basic economics, whoever said what, it is wrong, no matter what their opinion, either that or it's being read wrong.

"Unlike the first two Imperiums and most planetary economies, the Third Imperium has no central bank. No one in the Imperial Bureaucracy sets interest rates, acts as lender of last resort to failing banks, supervises check clearing or tries to reduce the impact of recessions. [...]

The Third Imperium has replaced the central bank structure with a monetary board. [...] Their task is to carefully control the long-term growth of the money supply so as to mirror the long-term growth of the economy. Too much growth in the money supply creates inflation; too little creates deflation.

[...] Forecasts are made for each sector in the Imperium every ten years and a suitable level of monetary expansion for that sector authorized. Each sector branch of the Imperial Treasury must then issue the appropriate amount of additional currency per year until the next review is completed.

The "new money" is generally handed over to the sector duke for official use, on the logic that the sector authorities are most likely to use the windfall in the public interest. Given the Imperium's very low economic growth rate, the amount is small compared to the sector-wide budget of the Imperial government. This system provides for a simple and transparent monetary policy that is largely immune to political pressures." [FT:7]
​

Far Trader was written by a professional economist. He may be wrong, I don't know enough about economics to say, but it can hardly be basic (i.e. irrefutable) economics that he is.

Or perhaps it is basic (i.e. simple) economics but not advanced economics.

Didn't I read somewhere about American dollars being minted by multiple banks rather than one central bank back in the early days? Or am I misremembering that?


Hans

 

[rancke]

I've brushed up on the text in Far Trader, and I must admit that it is strongly implied that individual member worlds do not issue their own currencies. So strongly implied that the only thing missing is a direct statement to that effect.

I find that much more difficult to believe than the absence of a central bank.

So taken with the canonical rules for exchange rates between the local credits of different worlds, I'm inclined to consider this a canon conflict and go with the (IMO) likeliest version of having member worlds being allowed to issue their own currencies if they feel the need.

But I conceed that there is strong evidence for the contrary view.


Hans

 

[Dragoner]

"Unlike the first two Imperiums and most planetary economies, the Third Imperium has no central bank. No one in the Imperial Bureaucracy sets interest rates, acts as lender of last resort to failing banks, supervises check clearing or tries to reduce the impact of recessions. [...]

The Third Imperium has replaced the central bank structure with a monetary board. [...] Their task is to carefully control the long-term growth of the money supply so as to mirror the long-term growth of the economy. Too much growth in the money supply creates inflation; too little creates deflation.

[...] Forecasts are made for each sector in the Imperium every ten years and a suitable level of monetary expansion for that sector authorized. Each sector branch of the Imperial Treasury must then issue the appropriate amount of additional currency per year until the next review is completed.

The "new money" is generally handed over to the sector duke for official use, on the logic that the sector authorities are most likely to use the windfall in the public interest. Given the Imperium's very low economic growth rate, the amount is small compared to the sector-wide budget of the Imperial government. This system provides for a simple and transparent monetary policy that is largely immune to political pressures." [FT:7]
​

Far Trader was written by a professional economist. He may be wrong, I don't know enough about economics to say, but it can hardly be basic (i.e. irrefutable) economics that he is.

Or perhaps it is basic (i.e. simple) economics but not advanced economics.

Didn't I read somewhere about American dollars being minted by multiple banks rather than one central bank back in the early days? Or am I misremembering that?


Hans

You can't have an advanced economy without a central bank, economist or not, he is wrong. It is just not believable, you wouldn't have control over your monetary policy, at best he just being political and snarky, saying there is a central bank, just not named as such. He is contradictory to in his statements, without control over the M1, M2, etc., you wouldn't be able to adequately stave off inflation or expand to prevent deflation; his statements are nonsense.

The US still has multiple mints.

 

[rancke]

You can't have an advanced economy without a central bank, economist or not, he is wrong. It is just not believable, you wouldn't have control over your monetary policy, at best he just being political and snarky, saying there is a central bank, just not named as such. He is contradictory to in his statements, without control over the M1, M2, etc., you wouldn't be able to adequately stave off inflation or expand to prevent deflation; his statements are nonsense.

I'm not sure what you mean by an advanced economy. Jim's statements sound perfectly reasonable to me, but perhaps they do not describe an advanced economy. Perhaps the Imperium doesn't have an advanced economy. The monetary policy is to keep the supply of money steady compared to the size of the overall economy and otherwise interfere as little as possible. That may not be advanced, but who's to say it isn't sufficiently advanced? Jim's assumptions seem to be that the overall economy of the Imperium increases slowly and steadily, with recessions being purely local occurrences. What is unbelievable about that? Why would an economy based on 11,000 worlds be as vulnerable to recessions and booms as one based on part of a single world? That sounds far more unbelievable to me.


Hans

 

[Dragoner]

I'm not sure what you mean by an advanced economy. Jim's statements sound perfectly reasonable to me, but perhaps they do not describe an advanced economy. Perhaps the Imperium doesn't have an advanced economy. The monetary policy is to keep the supply of money steady compared to the size of the overall economy and otherwise interfere as little as possible. That may not be advanced, but who's to say it isn't sufficiently advanced? Jim's assumptions seem to be that the overall economy of the Imperium increases slowly and steadily, with recessions being purely local occurrences. What is unbelievable about that? Why would an economy based on 11,000 worlds be as vulnerable to recessions and booms as one based on part of a single world? That sounds far more unbelievable to me.


Hans

Of course the Imperium has an advanced economy; and if worlds started economically collapsing, it would have a domino effect and the entire Imperium would collapse.

It's not science fiction, economics is real; which Marc has said two salient facts: 1) The Imperium is based on commerce and 2) follow reality. Trying to reinvent the wheel, making contradictory statements (like not setting interest rates which is the primary tool by which the monetary supply is regulated), it makes a mockery of Traveller, like Santa Claus is the war hero of the Ithklur.

 

[rancke]

Of course the Imperium has an advanced economy; and if worlds started economically collapsing, it would have a domino effect and the entire Imperium would collapse.

Explaining why this is a given would be a lot more convincing than Proof by Assertation.

It's not science fiction, economics is real; which Marc has said two salient facts: 1) The Imperium is based on commerce and 2) follow reality.

You haven't provided any evidence that Jim McLean isn't following reality.

Trying to reinvent the wheel, making contradictory statements (like not setting interest rates which is the primary tool by which the monetary supply is regulated), it makes a mockery of Traveller, like Santa Claus is the war hero of the Ithklur.

It's not a contradictory statement when Jim expressly explains how the monetary supply is managed without the use of interest rates.

It seems to me that you're not actually reasoning that it wouldn't work but rather taking it as an article of faith that it wouldn't work. And since there is little reason to expect anything useful by arguing faith, I suggest that we just agree to disagree.


Hans

 

[Dragoner]

Explaining why this is a given would be a lot more convincing than Proof by Assertation.

How about Empiricism? Look at the current situation in your own back yard with the PIIG's.

You haven't provided any evidence that Jim McLean isn't following reality.

Because his statements where he contradicts himself isn't enough.

It's not a contradictory statement when Jim expressly explains how the monetary supply is managed without the use of interest rates.

It's nonsense, like saying: "here fix this engine, without using wrenches." Ridiculousness, it is an insult to Traveller player's intelligence. Nobody would do it that way.

It seems to me that you're not actually reasoning that it wouldn't work but rather taking it as an article of faith that it wouldn't work. And since there is little reason to expect anything useful by arguing faith, I suggest that we just agree to disagree.

No, I have had university level economics courses as well as up until 2008 about $40,000 in the stock market, you better believe I have a high level of interest in how the market works. By your evident lack of education, you are the one that is operating on faith, that is what you are saying. It is funny you said how you like things to make sense in the other thread, then you believe in this fluff.

 

[rancke]

How about Empiricism? Look at the current situation in your own back yard with the PIIG's.

As I already asked you once, what is your evidence that an economy backed by 11,000 worlds will work just as the economy of my back yard? I would think that the odds are that it will be far more stable.

Because his statements where he contradicts himself isn't enough.

But you haven't shown that he contradicts himself, merely asserted it. Don't say it's obvious, because such an assertation is worthless and quite clearly untrue. It isn't obvious to me and evidently it isn't obvious to all economists either.

It's nonsense, like saying: "here fix this engine, without using wrenches." Ridiculousness, it is an insult to Traveller player's intelligence. Nobody would do it that way.

Proof by Assertation again. Still no more convincing than the previous times.

No, I have had university level economics courses as well as up until 2008 about $40,000 in the stock market, you better believe I have a high level of interest in how the market works.

I wouldn't dream of questioning your expertise in how the stock market you invest in works. I merely question your belief that the Imperium MUST work the same way.

By your evident lack of education, you are the one that is operating on faith, that is what you are saying.

That's true as far as it goes. Apparently either professional ecomomist Jim McLean is wrong or you are. Since I can't say from my own knowledge which one it is, I have to go with the one that makes the most sense to me. So far you haven't provided ANY evidence to support your view, only bombastic pronouncements, so you're not making any sense at all yet. That tilts the balance completely over in Jim's favor. So currently I have a lot more faith in Jim than in you. Feel free to change that by providing some reasoned arguments any time you can.

It is funny you said how you like things to make sense in the other thread, then you believe in this fluff.

It does make sense. It may be wrong, I can't say, but it definitely makes sense to this layman.


Hans

 

[Peter Schutze]

my universe has usually glossed over the currency issue because Ive always seen the players accounts being kinda like my paypal account works .... it resolves any exchange rate details automatically so they can just think in CrImp

For the imperium as a whole I figure there are multiple overlapping "currencies" that are effectively ignored by system hoppers.

Officially you may have to work in the local currency but the CrImp is the yardstick kinda like the US$ is now or the british pound stirling used to be so it is readily accepted anywhere not under interdiction or the TL3 guy on a lonely farmstead miles from the nearest little village.

 

[rancke]

My vote is 'none of the above': All Imperial member worlds IMTU use the credit and many also use their own currencies.


Hans

 

[McPerth]

I voted most of the worlds have their own currency, and I'd add most of the counties on balkanized worlds also have it. IMTU, the only worlds that don't have it are those under direct Imperial control (e.g. Depots, as described in MT: Rebellion Sourcebook) or those too small (in population, not world size) to be ableto print and back it.

That does not mind the players have to exchange their money at every port call, as ImpCr is accepted in most places near startowns (but they may need it if they venture far from the starport). Usually this does not to be represented, as the added complexity largely overcomes any liking for more realism the players have. Usually you (as a referee) may just rule that the ImpCr is accepted unless is to your best interest not to.

Not to have your own currency is to give up your economic policy independency, and that is one of the reasons I believe most worlds (or countries in balkanized worlds) capable to do it issue its own currency.

Another thing to keep in mind (mostly for planets/countries just able to issue it) is the income source the same money may be (at least it is, as well as stamps, in real world) as collectibles. This income may be negligible on a large economy, but is not so in small ones.

Another thing I believe abut money in TU (at east in MTU) is that cash is used quite often by travellers, as a way not to outrun its own credit, and so it's quite more common (at least among players) that is usually accepted.

 

[kafka47]

Having lived through Yugoslavia's hyperinflation in the 1980s...I always use the Imperial Credit as we used the Deutschmark - all prices were denominated in Dms but used Dinars for everyday use. Now, if you really need something done currency could include services in kind. And, the Dm would just be the yardstick.

Similarly on an Interstellar basis most worlds use the Imperial Credit and surrender their autonomy to Imperial financial interests much as Eastern Europe (trading Russian tanks for German banks) in exchange for stability of domestic economies. However, if they need to inflate the economy the can raise local bonds to be paid in Credits or in the short term local scrip. But, in reality, it is the resource base of the world that determines how competitive a world is...but Traveller is very utopian in the sense that it believes the more technological innovation you get the less necessary competition actually is and creating a leisure class. Now, this might hold true in theory but in practice, it is that most of the Hi In TL F worlds have living on the backs of lesser developed worlds who provide markets and some of the component manufacturing for those Hi Tech worlds. Thus, sometimes, if the Hi In TL F world is in isolation and surrounded by lower tech worlds then those lower tech worlds are forced into using their own currency so that their industries may compete against each other to gain entry to the TL F worlds markets. Classic Hobson's Imperialism.

 

[RainOfSteel]

This was, originally, just one post. However, it became several pages in length and was just ridiculous. I split it up.

You can not have a currency without a central bank, it is basic economics,

The USA certainly had a currency long before it had a central bank. The Secret Service, a branch of the US Treasury, spent many decades pursuing counterfeiters before the Federal Reserve Bank was established (and also before it was assigned to protect the President; getting its department moved over to Homeland Security only after 9/11).

Nations on Earth have had currencies going back into antiquity without ever having a central bank.

A central bank is, flatly, not a requirement for a nation to have a currency.

[...] it is just not realistic at all.

More or less realistic than the Imperium's millennia-long economic and population growth rate of less than 1%? In 1,100 years, the Imperium has only gone up two tech levels; that seems a bit strange. The Imperium has 340 worlds with class A starports with a Population of 0, 1, 2, or 3; not very realistic IMO.

[...] it speaks poorly of the material.

GURPS Traveller material is some of the best-written of all Traveller versions.


---------------------

I've brushed up on the text in Far Trader, and I must admit that it is strongly implied that individual member worlds do not issue their own currencies. So strongly implied that the only thing missing is a direct statement to that effect.

GT:FT p.8

When peace and prosperity reign, the value of the credit rises relative to planetary currencies [...] when war, strife or economic crisis strikes, the value of the credit falls as the risks of trade increase [...]

---------------------

You can't have an advanced economy without a central bank,

You just moved the goalpost of your previous statement. First, you can't have a currency without a central bank, which is wrong, then you can't have an advanced economy without a central bank.

The Imperium does have a Monetary Policy Board and the Ministry of Commerce and they have various regulatory functions; both without being a central bank. I can't reproduce the entire text of GT:FT for you, here.

It is just not believable, you wouldn't have control over your monetary policy,

See GT:FT for information on the Monetary Policy Board.

He is contradictory to in his statements,

Please cite the contradictory statements so I may review them.

 

[RainOfSteel]

Of course the Imperium has an advanced economy;

Except you haven't defined what you consider to be an advanced ecconomy.

and if worlds started economically collapsing, it would have a domino effect and the entire Imperium would collapse.

Worlds? How many? Two? Two worlds collapse would not cause the entire Imperium to collapse. Ten? A hundred? Even a hundred wouldn't do more than wipe out a domain.

which Marc has said two salient facts: 1) The Imperium is based on commerce

Actual calculations show that the total value of trade in the Imperium is miniscule in comparison to the value of the economies of the combined high-pop high-tech worlds. The other worlds total economy is insignificant.

Marc also said that there were 11,000 worlds in the Imperium. The actual number is just over 9,000. Are you going to contradict me on this one? Have you ever bothered to count them? I have.

In the Sunbane UWP data, there 169 worlds with Size 3 or less, Atmosphere 3 or less, and Populations 9 or A, many with TL-0 (equaling every being dead for not being able to breath or have respirators, or have respirator or pressurization technology; and no, they aren't going to be able to import breathing support for entire populations of billions or tens of billions). A later version of the UWPs changes the TL on a number of those worlds to F. If I ever get around to updating that later UWP set with the necessary information to run my economics calculations on it, that will only substantially boost the Imperium's total GDP and therefore its already immense tax base; high-pop high-tech worlds are the chief engines of economic power.

and 2) follow reality.

Except, just what is reality? Have you really gone through the UWPs of just the Imperial sectors? Tiny vacuum rockball worlds with tens of billions exist within a jump of standard size, atmosphere, and hydrographics worlds with low or zero populations. Starport A on multiple population zero worlds (not even enough people present to man the Starport).

One thing I know about economics is that ten different economists still somehow manage to produce different projections about what will happen in the future, and none of them will be exactly right (or they would be wealthy beyond the imaginations of even Bill Gates, Warren Buffet, and Bernie Madoff).

Trying to reinvent the wheel, making contradictory statements (like not setting interest rates which is the primary tool by which the monetary supply is regulated), it makes a mockery of Traveller, like Santa Claus is the war hero of the Ithklur.

 

[RainOfSteel]

Because his statements where he contradicts himself isn't enough.

I await your citations of contradictory statements in GT:FT.

It's nonsense, like saying: "here fix this engine, without using wrenches." Ridiculousness, it is an insult to Traveller player's intelligence. Nobody would do it that way.

You have yet to provide any information that would indicate that this is the state of affairs. A doctoral-level individual has made statements which you have not indicted as being incorrect other than to state "it's wrong". You stating "it's wrong" without backing up your statements with something more than "it's wrong" doesn't go anywhere.

No, I have had university level economics

Your statement that you have taken "some university courses" is insufficient for me. I'll need you to provide actual discussions.

By your evident lack of education,

Now you're attempting to attack Hans rather than support your position.

 

[RainOfSteel]

[...] All Imperial member worlds IMTU use the credit and many also use their own currencies.

That is choice number four. Choices two through five do not exclude the existence of the Imperial credit. They only discuss what each world is doing internally.

 

[McPerth]

By your evident lack of education...

I know I'm not the one to fix what you wrote, but perhaps you meant here by your evident lack of knowledge about the matter. This is quite different, as not knowing about a subject doesn't mean lack of education. If so, even those who win Nobel Prizes could surely be labeled as lack of education.

My own knowledge about economics is probably not better than Hans', and sure worse than yours, and I don't believe I lack education, just my education has been centered on other matters.

 

[morfydd]

For MTU each wrld has its own currency and the Imperium has its own currancy ..all Imperial starports accept Imperial Credits and there is an exhcange vendor in ach starport to swap back and forth from the local currency ..

Some subsectors/sectors have their own currency as well ..and of course you need to change over from Imp Creds to Other polical credits/currency when leaving imperial space ..