Pamphlet-writing is fun. Here's a 2-sided printable free pamphlet for Magical Industrial Revolution. It summarizes the compressed Joint-Stock procedures from the previous post. Clearly, the best way to get your players to participate in a ludicrous, convoluted, and math-based minigame is to make a pamphlet about it.
|Link to Pamphlet|
While you're here, why not read about financial instruments that I'm not even including in my game? One of my players - my actual, real-life players - read my previous post and said, "Wizards won't want to claim they own that even if they can."
Bonds are a debt instrument.* Bonds are
another device for obtaining money. They are debt that can be sold and
traded like a share. Instead of paying a dividend based on profits, they
offer a fixed return per year. They are therefore less enticing to some
investors, but may be favoured by risk-adverse, deep-pocketed, or
widely spread investors.
*The Walther PPK is a Bond instrument, and Bond is a blunt instrument.
Bonds have a fixed Par Value, Maturity Date, and Interest Rate. When the bond's Maturity Date arrives, the company agrees to buy it back from whoever holds it at the Par Value. The Interest Rate of a bond is set when it is created, and must be lucrative enough to attract investment. If a company winds up, bondholders are paid before shareholders.
typically have maturity dates well into the future. 10, 20, or 30 year
bonds are most common. The buyer must be confident the company will
exist when the bond matures. The Hawkwright Frame Co. Ltd. will probably
exist. Blast-O-Pow-Der Ltd. might
not exist next week if the smoke coming from their workshop is any
indication. Small or financially shaky companies have to offer higher
interest rates. The Bank of the Realm sells government debt bonds with
2% interest; companies might have to offer 10% or 20% to make it worth
[Par value of a Bond] = [Capital Required] / [#of Bonds][Tempting Interest]
Say you wish to raise 1,000gp. You offer 1,000 bonds at an interest of 10%. The Par Value is therefore 10gp. Each Season, until the bond matures, you will need to pay 100gp in interest, and when the bonds mature buy back the whole lot for 1,000gp.
The long maturity of bonds makes them unsuitable for Magical Industrial Revolution,
where the time scale is compressed and businesses regularly explode. Stock-jobbery, bubbles, and
convoluted financial schemes can come and go in a single year, or even a
single week, but bonds with long maturity dates aren't interesting
(from a game design point of view) if the entire setting might not exist in ~8
years. However, as they enable plenty of real-world financial chicanery,
I thought I ought to mention them.
The Bond Money Printer
You buy bonds with a yield of X. You go to the bank and use those bonds as collateral to get a loan with a nice low interest rate of Y. The bank is happy to offer you this rate because it means they're getting a slice of the bond without exposure to the same level of risk.
the loan to by more bonds with a yield of X. You go to the bank and,
with your newly increased collateral, get a loan of with interest rate
Y. And you keep doing this until the bank won't lend you money anymore,
or until you get giddy and have to have a lie-down.
As long as
X (the interest on bonds you own) is greater than Y (the interest on
your loans), you're good. You're getting money for free. And bonds are
stable. If you were smart, you bought extremely stable bonds, or even
government debt (the most stable of them all, if you can get a low
enough interest rate on a loan). But if, for whatever reason, X is no
longer greater than Y, then you are in real trouble.
This is (allegedly) one of the factors in the 2022 UK Pension Crisis.
This scheme is nowhere near as profitable as some of the ones discussed in the previous post, but it is free money.
is a special kind of trade that relies on a price mismatch in two
different markets. It's a bit complicated, but here's the simple (i.e.
If you buy iron bars in London, trade them for
sea lion pelts in Seattle, then sell those pelts in Shanghai for tea,
you're doing trade, and while you might make a colossal profit on each
step, you also have to sail around the world, pay your crew, and accept a
lot of risk. Everyone involved trades something they have for something
they want. This, in theory, justifies the profit.
With arbitrage, you buy something and simultaneously (or
as close to simultaneously as possible, given market conditions) sell
it for a higher price. It's less risky (but can still fail) and
generally exploits information only, not distance, risk, or
inconvenience. You see that A wants to buy a stock at one price, and you
know B wants to sell the stock at a lower price, so you run over, buy
from B, sell to A, and collect the profit. Once people notice you're
doing this, prices tend to converge. Why would they pay you when they
can pay each other?
I normally wouldn't include this
Shark-level concept, but arbitrage lies at the core of many schemes that
turn out to be scams. The original Ponzi scheme promised returns based on stamp coupon arbitrage. Defunct cryptocurrency exchange FTX's unusually high returns were attributed to cunning risk-free international arbitrage. It's a way of making money that requires secrecy and cunning while generating (in theory) enormous profits.
- If someone offers unusually high returns (20%, 30%, etc.), be extremely skeptical.
- If they tell you they can offer such a high return because of arbitrage, put one hand on your wallet and back away slowly.
- If they say it's risk-free arbitrage, laugh derisively while holding onto your wallet.
- If they tell you their arbitrage method (what they're trading and where) sprint away while hooting like a gibbon.
Corporate Shadowfiles (and Corporate Download)
Corporate Shadowfiles is somewhere between an epistolary novel and a Socratic dialogue. It’s presented as a series of timestamped forum posts, where different runners offer their perspective on corporate finance, politics, and the world in general. It's not exactly immediately gameable content, but it's a good worldbuilding method, and it has some nice layout tricks like an indented navigation bar and a different visual style for each corporate background.
It also has something to say about the world of Shadowrun and, by extension, the world of 1993 (or possibly the world of the late '80s, but it's close enough). It's insightful.
The book's replacement, 1999's Corporate Download is much less interesting. It's all metaplot. Corporate Shadowfiles spent around 113 pages on business concepts, leaving just 32 stylized pages for metaplot and fluff. Corporate Download deals with business in a vague and genre-reliant way in just 14 pages, then spends over 110 pages on metaplot and setting trivia that characterized the late '90s/early 2000s sourcebooks for all systems. Corporate Shadowfiles was written and designed by one author, the late Nigel D. Findley, and bears the signs of intention and craft. Corporate Download was written by 8+ authors, each taking on a chapter, with the expected result: a dreary forgettable paid-by-the-word mess.