Dark Depths

[Danzig]

OOC: pretty obvious, but this is sort of secret. It's more of a nice way of letting ya'll know OOCly what I am planning. So evil!

IC:
April 7
The Banker's Society building at 92 Taft Avenue, financial district.

The Intergovernmental Monetary Agency is a fact. How it came to be, whatever satanic force gripped the minds of the delegates who votes for shall forevermore be clouded in obscurity and mystery. Several bankers, the most prominent and wealthy of the world, were gathered in Danzig to celebrate. However, within the dark depths of the human mind, these men and women were already preoccupied with the following. Preperations for the rise of the Intergovernmental Monetary Agency were set in motion months before Danzig even began to mutter about the creation of such a behemonth. The panel members chosen, the committee would be in essence powerless, bureacrats selected on grounds of loyalty to their former employers, not the Council of Nations. Resolution is vague, clouded by a diplomatic fog of cigar smoke and crisp clean thaler bills. Sitting on the dark brown leather couches, in a room where the walls are decorated with paintings by Old Masters, cabinets filled with ancient tomes. The couches were all identical and lined with silk and gold leaf on the wooden ornaments, Donald Twickl, the CEO of Mendelsohn's, the largest bank of Danzig, drew on his cigar, the crowning achievement of the art of cigar making. A Corona styled giant, blowing out smoke while nipping on a glass of port. A glass of port is accompanied by a fresh green apple, thinly sliced to bring the taste of the port to better accents. Twickl looked around, seeing David Faraq, who was destined to become Special Advisor to the Chief Economist at the IMA. On his right hand side were some other bankers and possible candidates for top IMA positions. There were no Wieser individuals around here; the Banker's Society is strictly Danzig citizens only. One of the most exclusive secretive societies in town, its famed for its exclusive membership and the imposing building it resides in.

`Gentlemen, while everything is proceeding ahead as planned, tomorrow our friends in the General Assembly shall post the list of Panel members. Not the committee, let the fools in Augsburg figure that one out.' He took a sip of his port and carefully inspected the ash cone of his cigar. `The problem at hand goes deeper. There are several strong objections from a bunch of delegates. Others who vote no on ideological grounds are not a problem. They cannot see what lies beneath. In the dark depths of the resolution, ha!' Anyways my dear friends, something must be done before the situation spirals out of control. Opposition is infectious if it grows unchecked. What do you think Mr d'Anticosi?'

Ambrosio d'Anticosti was the chairman of the board of investment bank Moffat & Company, a gold and silver bullion bank and investor in precious metals and commodities. It is the largest commodities brokerage firm, in addition to its investment banking division which is considerably smaller, in the world. `Well mister Twickl I'd say that Wiese is indeed the problem child of them all. Franken and Eiffelland are... not important. We can handle their opposition and are important trade partners. Wiese on the other hand, is not. Our business profile is limited, their funds in our fine city are virtually nil according to the latest statistics. We can harm them. We can hit them. Several coordinated speculative attacks, from our branch offices in Levantine States and elsewhere, a ripple effect around the globe. First and foremost, we must undermine confidence in them. Politically it will be a lot easier than financially though. Talemantros is also a prime target to undermine their opposition.'

`Any suggestions how to,' Twickl asked, searching the gathering.

`Yes I do, actually.' People looked around and found a bright man standing in the corner. At first people couldn't remember his name, his position is not well known and isn't a true banker. He owns the City Export-Import Company and does the occasional odd-job for the Danzig Traders Bank. `Ah, señor Valencia, please be seated.' Twickl enthousiastically announced to his fellow bankers. `Your suggestion please.'

`Gentlemen, first I like to say what a joyful moment this is. After years of work, our fruits is being harvest... Wiese is a sovereign nation and keeps to itself. We should tell our delegates in the General Assembly to open up a frontal attack on Wiese and their position. Bring forth the topic of their commitment to the council and hammer on their rejections on and onwards. By the way, Wiese is far too stable to be the target of any sort of financial, speculative attack. Our attention must focus on Talemantros. They border a nice cooperative communist regime called Carentania. Big capitalism loves big socialism because we overlap on several ideas. Our methods only differ from their results. Talemantros is weak, their financial stability is the worlds joke and the punchline is their self-esteem. We can hit Talemantros. When the world realizes their financial worth is as good as a wooden five cent piece, their opposition will be over. Our IMA will rescue Talemantros, the financing is in safe hands with us. Because the IMA is busy being set up, the excuse to use our money as collateral is secure. With Talemantros out of the way, there's only one path left: to glory.'

Twickl and the others were impressed. None of them saw this coming and aides were called in to start investigating the Talemantros scenario. On paper everything looked good and until early morning April 8, analysts and financiers were looking into the possibility of a huge speculative attack on Talemantros. The numbers add up, the information flow is perfect. Quite like a Danzig banker, everything was planned to perfection with utmost precision. The vote ends April 14. Six days left until doomsday for Talemantros financial markets. And to add insult to injury, a sham company, named the Home Loan Equity Corporation will be tasked with buying up chucks of worthless Talemantric assets once done only to dump them again massively when the first dust settles. The attack will commence on April 13 starting in the east and moving with dusk to the west until dawn in the east when markets close.

 

[Vistrasia]

As the meeting was ongoing, David Faraq looked across the lounge, at 55 he was one of the younger guests, but in those 5 and a half decades he had managed to build up an impressive resume. His father led the Danziger branch of the Rosenblum-Almaguer Bank and had maintained that position for some time, growing to become more prominent and in the know with the establishment of Danzig then the Ambassador himself. Faraq's went to boarding school in the Levant, but by the time he was fit for higher education his father had enough connections to get him into any Danziger academic institution.

After an impressive career at Rosenblum-Almaguer, the Levantine Central Bank and AGE financial institutions, Faraq made the jump across the pond to become Assistant Treasurer of the Banque Nationale de Danzig. Despite his obvious qualifications, the main reason for his choice was obvious, to act as an intermediary between the Danziger and Levantine bankers, to ensure the support of the Levantine banks in Barca to the policies of the IMA. After a quick talk with the present bankers from Levantine, he walked into the corridors and started calling long distance to Barca.

His job was simple: get the right individuals within the Levant in on this, trusted figures in the financial world. The most prominent bankers were present anyway, but this was a broader operation. If a nation the size of Talemantros was to fail, this would require a broad effort.

 

[Danzig]

The amendment passed, as expected. The frivolous Danzig re-amendment is likely going to fail to pass in the General Assembly. Bankers and financiers from across the globe are aware of this, but the existence of the IMA is not at risk. At the heart of the amendments is still the IMA remains an independent organisation within the Council of Nations which allows for flexibility. The ignorant delegates of Talemantros removed several clauses but the most important ones remain. However, it was foolish of them to go headfirst with some of the most powerful people who have contributed years of work to this end. Nobody calls it punishment, instead, righting the wrongs of their previous behavior. And someone must pay a price. David Faraq, one of the must trustworthy figures in Danzig with extensive connections in Levantine States was put in charge of an operation that would instigate a heavy speculative attack against Talemantros.

Such actions are common coming from Danzig, mainly from hedge funds and private equity firms who use incredible leverage to build huge positions against particular security - currencies, commodities, stocks, bonds - wait for the tide to turn against it and 'go short'. This strategy is fairly common practice and it has caused damage around the world that preceded a financial crisis. In nine out of ten times Danzig emerged wealthier and more powerful from the crisis they more or less caused leading to the popular belief that Danzig creates a crisis, reaps the benefits, buys depreciated assets for pennies on the dollar and by relaxing credit to start a new boom cycle. One could argue the world would be better off without the Free and Hanseatic City of Danzig. But with banks entwined with others across the world, having set up branches in every major city of the world, interconnected with all big and influential financial institutions, the Danzig ideas of finance and economy are rooted too deep to eradicate. Even if in a freak event Danzig would sink into the ocean the spirit of Danziger Capitalism would stay alive. It would florish, providing its host wealth, power and grandeur while leeching the lifeblood of many a society, money, and turning it over to its host in return for protection. A similar symbiotic relation exists between Eiffelland and Danzig. Danzig enjoys protection from Eiffelland and in return all Eiffelland citizens are free to move to and from Danzig, may set up a business, are treated equally and are tax exempt like Danzig nationals.

Several smaller hedgefunds have been building positions in Talemantric government bonds[*] and gradually driving interest rates up. Talemantros has recently privatized many of its industries and the money earned is eaten by steadily rising interest rates. The difficulties surrounding Carentania are involved and analysts are repeating themselves every day: Talemantros will face a long war, perhaps a stalemate, if either nation decides to confront each other. Tourism in Talemantros is likely to face a backlash and investors may pull out. Everything has a potential negative side effect and the usual silving lining found by Danzig analysts is nowhere to be seen. And the same signals from across the globe are repeated. Branches or subsidiaries from Danzig financial houses have been instructed to move private wealth out of Talemantros and take it elsewhere - anywhere and high net worth individuals are advised against putting money in the riskier Talemantros government bonds. In two weeks time a chain reaction was set in motion to create the perfect storm against Talemantros and their finance sector and the economy as a whole.

[*] Taley if you start BS about this then you can start by explaining to me how you 1) finance your nation and 2) why only your country has an appetite for your own governments debt.