Cash is king.

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steve98052
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Cash is king.

Postby steve98052 » Tue Oct 01, 2013 8:40 am

In the process of researching my first-ever message* on this forum, in hopes of finding it already addressed, I came across a number of discussions about currency. A recurring topic was the question, "How does one transport money between worlds?"

The predominant answer, per canon, is "cash!" The fact that all communications in Traveller are limited to the speed of jump limits propagation of bank balances between worlds in different systems. If my bank balance existed as data in my bank's computers, I could (theoretically) pick a spot where the x-boat route takes two jumps to travel between systems that can be reached in a single jump (such as a kink in the x-boat route). Then I could make a withdrawal from a branch in one system right after the x-boat's departure for the day, get in a ship, travel to the jump point, make the jump two x-boat steps ahead, travel to that system's bank branch, and arrive ahead of the x-boat notification that I had already withdrawn money in the previous system, and withdraw the same money again.

Obviously, that's a scam that would put the law -- or at least the bank's enforcers -- on my trail. But if I think I can outrun the law, or think it's worth getting busted to have some fun until I get caught, I might be tempted.

What stops this? Maybe it's rare enough that it falls into the category of acceptable loss. Maybe banks limit withdrawals to people until they've been on a world long enough for their financial records to be certain to have caught up with them.

Limiting transactions until records have time to catch up can be defined out to any given range, but it's an increasingly large inconvenience to honest customer to do it over increasing distances.

One could substitute credit limits for actual hard limits, but that constrains the very sort of person a bank would most want as a customer: the super-rich.

The ultimate solution is cash, both by the reasoning above and by canon. Maybe that's why Imperial cash is produced in such large denominations; 1 MCr in 10k notes is only 5 mm thick.

---

When one reaches a system, an exchange of cash for modern money is likely. On a world of adequate tech level, one could drop enough cash into a local bank for one's stay on a world, open an account with all the electronic spending we have in the modern world, and have handy access to local currency if it's not the Imperial Credit. (On a low-tech world, cash is still cash.) When one leaves, one can close out the remaining balance in the account, minus any fees that might apply to conversion to local currencies.

Short story: cash is king.

* "Credits, currency, canon" viewtopic.php?f=89&t=56821
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AdrianH
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Re: Cash is king.

Postby AdrianH » Tue Oct 01, 2013 11:39 am

steve98052 wrote:IThe fact that all communications in Traveller are limited to the speed of jump limits propagation of bank balances between worlds in different systems. If my bank balance existed as data in my bank's computers, I could (theoretically) pick a spot where the x-boat route takes two jumps to travel between systems that can be reached in a single jump (such as a kink in the x-boat route). Then I could make a withdrawal from a branch in one system right after the x-boat's departure for the day, get in a ship, travel to the jump point, make the jump two x-boat steps ahead, travel to that system's bank branch, and arrive ahead of the x-boat notification that I had already withdrawn money in the previous system, and withdraw the same money again.
I don't see the problem. You withdraw Cr1000 here and the bank here notes that your account is minus Cr1000. You jump ahead of the x-boat, withdraw Cr1000 there, and the bank there notes that your account is minus Cr1000. The x-boat arrives, the bank there receives the update and notes that your account is minus Cr2000 in total. In due time another x-boat makes the return trip and the bank here receives an update, noting that your account is minus Cr2000.

Of course, the reason the x-boat has to make two jumps is probably that the distance is too great for one jump. The "scam" requires a ship with a longer range jump drive, which means you've probably got a better scam working. :twisted:

For analogy, imagine the far past rather than the far future. Banks don't communicate electronically, they communicate by mail which travels by stagecoach. So I withdraw £100 from a bank in Edinburgh, get on a fast horse, ride to Glasgow before the stagecoach can get there, and withdraw £100 there. Both banks know I'm down £100, meanwhile there's £200 in my pocket. The letter from Edinburgh to Glasgow arrives, and in due time so does the letter from Glasgow to Edinburgh, and both banks now know my account is minus £200 total. Then there's just the question of how I acquired the fast horse in the first place. :D
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Re: Cash is king.

Postby simonh » Tue Oct 01, 2013 11:52 am

The problem of banking and credit given long travel times and large distances is not exactly a new one. It's essentially been a solved in various ways for thousands of years.

It really comes down to relationships and collateral. Not just anyone will be able to go to a distant bank branch to which they're never yet been and withdraw however much money they like. For most citizens their credit will only be good within a narrowly determined region, mostly just one system. For those who need more flexibility than that, arrangements can be made for looser credit, but over a larger area but it will be secured on assets such as property, businesses or guarantees from relations and business partners. For traders, the collateral may be the ship which while mobile, is a lot more traceable than individuals.

Access to funds or resources over longer distances can be managed using letters of credit, essentially taking the same role as cash but with contractual strings attached, again such as collateral requirements, guarantees and obligations.

The Templars are a good example. They acted as bankers for pilgrims and crusaders who would lodge contracts with their local chapter back home, signing over property as collateral, take letters of credit to the Levant and then cash them in as needed.

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Re: Cash is king.

Postby Boneguard » Tue Oct 01, 2013 12:44 pm

Another option is a highly encypted credstick with all your other Id (like in Shadowrun).

Essentially Everyone when opening an account get's a credstick that indicate how much you have.
- You want to get money, insert credstick into ATM and it will give you money while automatically reducing your balance on your stick -useful for low teck world where only spaceport has ATM.
- You want to transfer funds between 2 person, link the 2 stick together and you have instant transfer of funds.
- You want to deposite money, go to the ATM, put the money in, and it will add to your credstick.

Sure it could, in theory be hacked, and some are, but for the most part if the encrypting you good enough, most could not do it without leaving trace of tempering thus freezing the account.
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Re: Cash is king.

Postby F33D » Tue Oct 01, 2013 2:52 pm

simonh wrote:The problem of banking and credit given long travel times and large distances is not exactly a new one. It's essentially been a solved in various ways for thousands of years.<snip>
THIS. Well said.

And to add. Those Letters of Credit would probably be done via something like Public/Private key pair system that varies by type of transaction and date. Almost impossible to forge...
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Re: Cash is king.

Postby phavoc » Tue Oct 01, 2013 3:49 pm

Like today, large-scale cash transfers are nearly unheard of. Assuming you had an account in the Imperial Banking system, you will be providing ID that essentially marks you throughout the Imperium. Your citizens ID positively identifies who you are, and losing it and replacing it is a big pain.

The amount of money you could withdraw from a bank would hardly pay for the costs of transport. First you'd need a fast jump-capable ship. And that is going to cost tens of millions of credits. Next you would need to already have vast sums of cash in the system, and you'd have to allow time for the credit amounts to transfer. And a great deal of patience to set all of this up.

I believe that most banking is tied to your ID card, and you carry around the balance of your accounts on it. Cash would be used outside of starports and low-tech planets, but I would suspect nearly all transactions would involve credit payments instead of physical cash. If you look at how our society has been moving more and more to electronic transactions over the last few decades, I would suspect that this trend would only tend to increase - especially when it would involve shipping physical currency from system to system.

Not to say that this would NOT happen, I just think the amount of time and expense to set up this kind of con would render it cost-ineffective due to the high setup costs for the relatively low payback. An Imperial bank is not going to have 100million CR setting around in the vault just waiting to be withdrawn. And keep in mind in order to beat the X-boats you'll have to go off the beaten path, and those planets on the periphery will most likely have banking rules in place to discourage activities like this.

Say you set up your account on Regina and deposited 100million CR. And then you waited a few months for your account balance to propagate through the X-boat network. And then you decided to do your scam and withdraw 100million CR (in cash) from Regina. Then you get in your jump 6 ship and head towards Heya (also in the same sub-sector). With your jump 6 ship you should beat the X-boat, but the bank on Heya has a limit on cash withdrawls, say 25% ever 30 days over a specific amount. You might be able to keep ahead of the X-boat network for a while, but it would quickly catch up and bypass you because each time you did the scam, you have to maneuver and land on the planet (or station), make the withdrawl to get the physical cash, and then maneuver and jump out again.

I just don't see this type of scam working. It will have been tried and tried before, and the banking systems would have come up with ways to defeat this.
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Re: Cash is king.

Postby CosmicGamer » Tue Oct 01, 2013 5:56 pm

steve98052 wrote:The predominant answer, per canon, is "cash!"
I think one reason for this (besides a lack of financial expertise by the author) is the concept of free spirited adventurers who don't know where the next job or cargo will take them. Adventurers could possible arrive at a low tech world with a low class port and maybe there are no banking facilities even if issues of synchronizing accounts and credit did have solutions.
steve98052 wrote:Maybe banks limit withdrawals to people until they've been on a world long enough for their financial records to be certain to have caught up with them.
The traveler (non adventurer) who has no idea where they are going until less than 24 hours before they depart would be quite rare. People vacationing, traveling on business, and so on, could plan in advance and arrange for their finances to be taken care of before or near the time of their expected arrival.

Here is a snippet from IMTU document in case there is something that might be of use to you.
Economy
The Imperium protects and encourages trade between systems. This includes supporting a financial system for conducting trade easily and quickly.

There are multiple ways of conducting monetary transactions within the Imperial supported financial system as well as the numerous ways that worlds conduct business and ways things are handled outside of the Imperium.

Imperial Star Ports of a certain class or higher and all Scout and Navy bases have a branch of the Imperial Bank that will perform most transactions. Many space ports on Imperial worlds will have a branch of the Imperial Bank.

Local financial systems can take just about any form but most Imperial worlds will support the Imperial financial system to some degree. Sometimes it is just a bank in the capital that will exchange CRImps and local currency. Sometimes banks and businesses support all the common forms of Imperial cash and credit.

The smart card or credit stick
There are some devices that require obtaining authorization for each transaction (like a modern credit card or on line banking). There are other devices that are just a means of identifying the appropriate account from which funds will be provided (like old credit cards and checks). There are also smart devices loaded with a set amount and all transactions and the current balance are maintained on the device. This last group of smart devices are detailed here.

Devices can have numerous varieties.

A device could be loaded with actual funds (bought like a visa prepaid card).
A device could be loaded with a set amount of authorized credit.

Security
For security, some devices are only capable of a limited number of transaction. For security, devices usually have an expiration. For security, some devices not only electronically track transactions, but are physically marked or punched to indicate transactions. For security, some smart cards and credit sticks only have the ability to subtract funds and no amount of software hacking can add funds since the hardware is incapable of doing so.

While some devices are extremely reliable, nothing is tamper proof. Obviously, doing so is a crime.

Some versions of these devices are only provided by Imperial banks. Other devices can be loaded/created by certain high level authorized representatives, like TAS or trusted local financial institutions. There are some devices which can be acquired from a local merchant or even a ships Steward for paying crew.

Some cards are bearer versions - anyone possessing the card can use it. Most cards have some form of security from a simple pin to biometric authentication.

Usage
Even on a low tech world, some businesses may have a machine of the appropriate TL for conducting business using these cards. However it's more common for a traveler to use the most secure version of a smart card or credit stick and stop at the Imperial bank at the star port to obtain a version of the local financial medium.

Some cards are for Imperial bank use only but held by the account holder or a representative or even sent via courier. Businesses can't take them, they can only be used at another Imperial bank. This is usually for the transfer of large values when the normal means for financial institutions to convey information is not conducive to expedient transactions.

Once funds or credit is on a device, it's like cash in your hands. Some people do forgo using these devices and opt to use Imperial credits. If you lose the device recovery options can vary, based on the type of device, from as simple as requesting a new one, to long delays as the different bank branches all synchronize transaction logs and account information, to "You lost it? Sorry, not my problem".

Merchants, crew, and other seasoned travelers usually don't put all their eggs in one basket. They tend to have multiple credit devices with varying amounts, cash, and local financial instruments used by the worlds they frequent often.

It's a good idea for a merchant to know where they are going and to plan for their financial needs before they depart.

Pretty much all the ways we are doing things now are still possible in the future.

Note that though I use the term "card" or “stick” it can take many forms.
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Re: Cash is king.

Postby dragoner » Tue Oct 01, 2013 8:23 pm

"Money is a sign of poverty"

IMTU, The Core worlds, pre-virus are the beginning of a post scarcity economy, so money is just a facilitator for trade, esp on the fringes of the Imperium. Could you rip off a bank? Sure, but there is also a thriving bounty hunter industry to track you down.
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Re: Cash is king.

Postby Epicenter » Fri Oct 04, 2013 10:05 am

steve98052 wrote:But if I think I can outrun the law, or think it's worth getting busted to have some fun until I get caught, I might be tempted.

"Captain Kidd, if you've figured out a way to make piracy pay off, you must be bright enough to make ten times the money on the stock market." - Larry Niven


To play games like that, you'd have to have access to a fast ship; the overwhelming majority of ships the OTU are Jump-1, some at Jump-2. Xboats are Jump-4. You'd have to find, or more likely own a Jump-4 (or higher) ship yourself. I'm sure there's routes in the Imperial xboat network where you could "outrun" the xboat using a Jump-2 ship, but they're not common iirc.

I'd think by the time you owned a such a fast ship "stealing" some thousands, or honestly even tens of thousands of credits from some bank and moving on wouldn't even be worth the trouble for you.
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Re: Cash is king.

Postby F33D » Fri Oct 04, 2013 1:39 pm

CosmicGamer wrote:I think one reason for this (besides a lack of financial expertise by the author) is the concept of free spirited adventurers who don't know where the next job or cargo will take them. Adventurers could possible arrive at a low tech world with a low class port and maybe there are no banking facilities even if issues of synchronizing accounts and credit did have solutions.

The traveler (non adventurer) who has no idea where they are going until less than 24 hours before they depart would be quite rare. People vacationing, traveling on business, and so on, could plan in advance and arrange for their finances to be taken care of before or near the time of their expected arrival.
Yes, I think this explains the cash usage on an interstellar level.
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Re: Cash is king.

Postby AdrianH » Fri Oct 04, 2013 1:52 pm

CosmicGamer wrote:
steve98052 wrote:The predominant answer, per canon, is "cash!"
I think one reason for this (besides a lack of financial expertise by the author) is the concept of free spirited adventurers who don't know where the next job or cargo will take them. Adventurers could possible arrive at a low tech world with a low class port and maybe there are no banking facilities even if issues of synchronizing accounts and credit did have solutions.
For such occasions, the adventurer would probably be better to take some widely acceptable precious metal or gems, or some sort of trade goods. Otherwise, if that low tech world doesn't accept Imperial credits, e.g. if it's not in the Imperium, the adventurers are liable to find themselves in the same position as Obi-Wan and Qui-Gonn in Episode I. (Who could have solved their problems as well as improving the next two films by selling Jar Jar as a slave, a pet or meat. :twisted:)
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Re: Cash is king.

Postby F33D » Fri Oct 04, 2013 2:50 pm

AdrianH wrote:For such occasions, the adventurer would probably be better to take some widely acceptable precious metal or gems, or some sort of trade goods. Otherwise, if that low tech world doesn't accept Imperial credits, e.g. if it's not in the Imperium, the adventurers are liable to find themselves in the same position as Obi-Wan and Qui-Gonn in Episode I. (Who could have solved their problems as well as improving the next two films by selling Jar Jar as a slave, a pet or meat. :twisted:)
Not really given the economic power of the Imperium. There would be currency changers at whatever starport facility existed.
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Re: Cash is king.

Postby steve98052 » Sat Oct 05, 2013 11:10 pm

I took a look at a map to find where one might be able to pull off a double-withdrawal scam. If one had a large sum on deposit in a multi-system bank, and withdrew it at Dinomn (Spinward Marches 1912) right before boarding low passage on a Jump-2 ship to Extolay (Spinward Marches 1711), and withdrew it again there, one would end up with a double withdrawal three xboat jumps away, or about two weeks ahead -- and only one Jump-2 away from the nearest non-Imperial world, Tionale (Spinward Marches 1511). If the thief were able to reserve another low passage from Extolay to Tionale ahead of time, and had enough seed money to make two low passages worth the risk, he'd be on his way.

Of course, at that point he'd be a wanted criminal pretty much anywhere the bank in question had contacts. How much money does one have to score in a scam to make it worth being a wanted criminal? That is up to the criminal to decide -- but even a criminal who is smart enough to figure out the scam might not have a rational sense of how much money it's worth to be on a bank's wanted list.

--

I don't see stored-value cards (or "credit sticks") as a particularly satisfactory solution. Imperial currency is supposedly forgery-proof, at least within the range of technology one can find in the Imperium and immediate vicinity. It's pretty much universal throughout the Imperium. It's available in a wide range of values, from a quarter-Credit to 10k Credits. Given that a Credit was defined as about US$1 in 1977 (US$3.86 today), that's a range of US$0.96 or GB£0.60 or €0.71 for the quarter-Credit coin to US$38600 or GB£24000 or €28400 for the 10k Credit note. That's a lot of convenience, and doesn't require an assortment of specialized stored-value card readers. About the only place where Imperial Credits aren't entirely useful is very small-value transactions on poor worlds; for that, one would probably change some of one's credits into local sub-Credit coins.

--

For very large transactions, letters of credit work fine. People generally don't spend millions on short notice, so waiting for a transfer to pass through the xboat system works fine. Even so, cash would work even for huge transactions. If one wanted to pay MCr 100 for a starship straight off the lot, that's only 5 kg (9 pounds) of money, or a stack 50 cm (20 inches) thick, which fits in a small suitcase or backpack. (Just don't let the local mob know you're carrying that much, of course.)
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Re: Cash is king.

Postby F33D » Sat Oct 05, 2013 11:45 pm

steve98052 wrote:I took a look at a map to find where one might be able to pull off a double-withdrawal scam. If one had a large sum on deposit in a multi-system bank, and withdrew it at Dinomn (Spinward Marches 1912) right before boarding low passage on a Jump-2 ship to Extolay (Spinward Marches 1711), and withdrew it again there, one would end up with a double withdrawal three xboat jumps away, or about two weeks ahead
You forgot. J-2 Couriers cover the J-2 routes. Same operation as X-boats (one jumps in and radios its messages to the awaiting Type-S, etc.) You wouldn't really outrun the data.
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Re: Cash is king.

Postby steve98052 » Sun Oct 06, 2013 2:25 am

F33D wrote:You forgot. J-2 Couriers cover the J-2 routes. Same operation as X-boats (one jumps in and radios its messages to the awaiting Type-S, etc.) You wouldn't really outrun the data.
Fair point. Depending on the scheduling of the Jump-2 couriers, it may still be possible to beat the message. If the couriers run infrequently enough that it's possible to make it from the bank at Dinomn to the departure ship and the jump distance, then from jump arrival distance to the bank at Extolay, then back to the next departure ship, one could pull it off with careful timing. But if the lag there isn't all that long, it would make sense for banks to just refuse to release more than a token amount of cash from an account until they have been in a system long enough for the data to catch up. Sensible travelers would know that, and bring enough cash to cover them until their bank balances caught up with them -- another point driving the use of cash.
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Re: Cash is king.

Postby dragoner » Sun Oct 06, 2013 3:55 pm

Epicenter wrote:I'd think by the time you owned a such a fast ship "stealing" some thousands, or honestly even tens of thousands of credits from some bank and moving on wouldn't even be worth the trouble for you.
This. Then by that point, it wouldn't be worth it just for the fact you would have to keep moving, if you stopped, they would catch you. Not counting that the bank would be handing out MCr's without any hoops to jump through; banks do this now all the time: holds on checks, limits on cash withdrawals, etc. . I can see cred sticks very much in use: convenience over having to carry cash, and security in that if it is stolen, it can't be used without the original holder's biometrics or something.
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Re: Cash is king.

Postby Condottiere » Sun Oct 06, 2013 4:18 pm

You probably do need a LoC for outsystem accounts.

Forging a convincing one will probably be successful, but will ensure that a large bounty will be placed on your head, probably by the supposed issuer as well, just to set an example.
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Re: Cash is king.

Postby F33D » Sun Oct 06, 2013 4:35 pm

steve98052 wrote: But if the lag there isn't all that long, it would make sense for banks to just refuse to release more than a token amount of cash from an account until they have been in a system long enough for the data to catch up. Sensible travelers would know that, and bring enough cash to cover them until their bank balances caught up with them -- another point driving the use of cash.
All you have to ask is, "What would YOU do if it was your money you were handing out?" Banks would know of all the "holes" in the info courier routes and would act accordingly. In short, if a Tramp Captain could think of it, the banks long ago closed that "loophole"...
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Re: Cash is king.

Postby dragoner » Sun Oct 06, 2013 6:42 pm

Condottiere wrote:You probably do need a LoC for outsystem accounts.

Forging a convincing one will probably be successful, but will ensure that a large bounty will be placed on your head, probably by the supposed issuer as well, just to set an example.
There are a ton of good hooks for adventures, forging documents is good, or rolling your Soc modifier on the reaction table when talking to a banker, adding in any admin (let's go with soc 5 & admin 1, canceling each other out) -

from evildm:

Banker's reaction (2d6): 4, 3 = 7

7: non-committal.

Oh well, what now?
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Re: Cash is king.

Postby Lord High Munchkin » Mon Oct 07, 2013 3:09 am

You might find that there are daily/weekly/monthly limits on personal cash withdrawals. Not to mention a couple of days/weeks/months notice period for very large sums, even via bank draughts.
The desire for a "definitive, ultimate answer" is, in fact, classified by modern psychiatric medicine as a mental illness.

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