Stellaris: Earth Alliance

Chapter 271 Prelude to the Financial Crisis

Portman said he would pay double if he wanted to, and no one thought he would be unable to pay the money.

But after seeing the generosity of the mysterious man, the pirates were really suspicious of this.

Noticing the slightly disdainful look in his eyes, the congressman immediately felt unhappy, "Are you doubting Portman's financial resources?"

"No, of course I don't doubt it. Portman is one of the richest countries in the entire Eastern Galaxy. It's just that I doubt you are willing to part with so much money."

"More, I'm afraid you don't know how much our military expenditure is per year, right? Just this little money..."

The pirate no longer wanted to listen to his nonsense, so he sent a string of numbers to the other party.

After seeing the series of zeros on the screen and the mega-units marked behind them, the congressman's pupils suddenly enlarged, with a look of disbelief on his face.

"Are you sure this is U.S. dollars? And not some country's junk currency?"

"It's US dollars, and the other party delivered real energy coins, which are much more valuable than your US dollars. So now, do you still think you can afford this money? And double it?"

The pirate looked at each other with a smile.

To be honest, he really wanted to believe that Portman could afford the money.

After all, there is still risk in robbing the Portman merchant ship.

If you can get this large sum of money directly, why bother to go door-to-door robbery to complete the KPI?

But the problem is that Portman just can't afford the money.

The congressman's face turned blue and white. One second he was saying that Portman was the richest country in the world, and the next second he was in trouble because he had no money.

You can afford it if you insist on it, but...

Sure enough, when this amount was reported to Congress, they immediately expressed disapproval.

If you want to eat shit, you have to pay double. With this money, you can form an army and chase the predator empire every day.

Negotiations broke down, and Portman officially declared war on the Reaver Empire.

Then the plundering empire ran away with their families.

If you have the ability, come and chase me until the end of time.

But while chasing them, Portman's rear area was also attacked by countless pirates, which was very annoying.

"Who the hell? Paying so much money just to disgust us?!"

One member of Congress was very angry, and apparently the financial backer behind him was also brutally murdered.

This congressman represents the interests of the insurance industry.

Large-scale merchant ships were robbed, which overwhelmed the insurance companies and caused them to lose their fortunes.

The company behind it has sent a death order and must resolve this crisis.

In the final analysis, it was the inaction of the Portman government and the military that caused all of this.

Isn't it true that they operate in compliance with the law and pay taxes on time to create a stable business environment?

It’s a shitty business now.

Who is it?

At the same time, all the congressmen also had such questions in their minds.

Someone who can spend so much money in one breath must be an entire country.

In the entire Eastern Galaxy, there are only a handful of countries that meet the conditions.

But if they are willing to spend so much money on their country, I really can’t think of anyone other than Field.

"If we do not increase protection fees, then our economic activity will suffer a huge blow. If we continue to follow this trend, our economic growth will be negative next year. I think everyone here knows the consequences of negative economic growth, right?"

One of the congressmen said with a serious face.

After hearing what he said, everyone reacted.This matter is not actually a question of how many merchant ships were robbed or how much the economy declined.

These are not important. What is really important is the chain reaction caused by a large number of merchant ships being hijacked and the trade routes being stopped.

Portman is a society of advanced consumption, and the people's savings rate is extremely low.

Rather, the vast majority of people are actually taking out loans for consumption.

This economic model has advantages and disadvantages.

The benefits are clear, with economic growth consistently above double digits, but the downsides are equally catastrophic.

Advanced consumption can also be understood as a credit economy.

It is precisely because everyone has confidence in the future economy and believes that the future economic trend must be rising, then the economy will definitely rise.

And when everyone thinks that the economy is not doing well and they save money and are reluctant to spend it, then the economy will definitely fall.

In fact, it is similar to a stock. When everyone thinks it will rise and keeps buying, then the stock will naturally rise.

And when everyone thinks it will definitely fall, they keep selling.

Even if it does not fall, the entire company is running very well and there are no problems, the stock price will start to plummet.

Now the Portman conglomerate is equivalent to a listed stock.

When everyone is worried about the future economic situation, then Portman's economy must continue to decline.

The decline caused panic, and then another and another.

Portman's financial bubble was already inflated.

A large amount of money is stuck in stocks, and it seems that money is constantly making money, but when it is not sold, the money is just a string of numbers.

Once everyone senses that the economic situation is not good, they start selling bonds and stocks in the stock market in large quantities.

Then the economic bubble that Portman has been blowing for thousands of years will explode immediately.

The simplest example is that a bank owns ten properties, and these properties are very valuable.

Once the bank sells these houses, he can instantly take out tens of millions of dollars.

However, now someone comes to the bank to withdraw money and urgently needs 500 million yuan.

Assuming that the bank's cash deposits have been exhausted, it can only sell the real estate on hand.

However, selling a house does not happen instantly.

The other party urgently needs 500 million yuan to withdraw from your bank, but you can't get it out no matter what.

When others see that you can't even withdraw 500 million, they will all ask for money, and then the bank will disappear.

In the final analysis, it is still a question of trust. When people in the entire country believe in themselves, the country's economy will be better, and that will be better.

Now, with the crazy plundering of pirates, many trade routes in various places have been suspended.

People also stopped spending and saved their money.

This is a big problem.

If money is not used for consumption, the company's products cannot be sold.

If the company's products cannot be sold, the company is likely to go bankrupt due to a broken capital chain.

The bankruptcy of a large number of companies will lead to the unemployment of a large number of workers, and the unemployment of a large number of workers will lead to more people being out of money.

More people without money will lead to more bankruptcies.

A large number of companies have gone bankrupt and cannot repay bank loans, and banks will also go bankrupt as the capital chain breaks down.

Once the bank goes bankrupt, the chain reaction will become even more violent, eventually causing a financial crisis for the entire Portman.

(End of this chapter)