Economics: A Primer

As you may know, not all currencies are created equal. Depending on what a currency is backed by, and what others are willing to accept on the currency exchange market, a currency's value can fluctuate wildly. Governments and particularly powerful corporations may offer currency backed in good faith by their financial strength, for example. Corporations can issue currency in the form of stock, where units of stock are effectively worth their current value on the stock market.

Most of the world's money is cred, electronic currency. Cred is tracked by the interlocked accounting computers of the world's banks, rising and falling by the millisecond as economies change amongst countries, corporations, and persons of wealth and power. Legitimate citizens can access their funds through their ID cards or nice, traceable bank accounts that keep track of every cent as it moves from person to business to bank. Coded accounts, crows(escrows), reloadable gift cards, and similar ploys let folks move cred without sustaining the irritation of legal identities.

A tiny trickle of money is fold, folding money, hardcopy cash, real bills and coins. The firstworld governments keep trying to switch to a cashless society, and even the most tightly controlled ones find that they can't do it.Too many important people need money that can't be traced through the Net. No netrunner ever backtracked to its source a plastic sack stuffed with small bills.

In the firstworld, about 95% of the money supply is electronic cred. A well-behaved corporate lackey who never visits the poor side of town can go his whole life long and never see a scrap of fold. That other 5%, however - trillions of ecus - flows through the gutters of the streets and in the quietest offices of the spacescrapers, oiling the secret machinery that makes society run.

In the lastworld, fold is much more common. There are still places where the folks wouldn't know a credcard if you fed it to them! People can use cred in most lastworld cities, and even in some of the bigger towns. But out in the boonies, you use the local fold or you start talking barter.

For those who wheel and deal in the same circles as the corporations, knowing a bit about international commerce is important. The first thing you need to be aware of is that there are two major types of currency - hard currencies backed by strong firstworld economies or major international corporate players, and the soft currencies used by everyone else on the planet. While soft currencies aren't always bad, they often change value from day to day, usually for the worse, so accept them at your own risk. Hard currencies, on the other hand, stay relatively stable and even occasionally increase in value; when possible, you want to be paid in hard currency.

To maintain some semblance of sanity, GURPS measures all transactions in $, regardless of the actual currency being used. For those times when the actual currency matters, $1 is considered equivalent to one ECU, or Economic Currency Unit. This value is what is used in world economics and is pegged on a value based on global supply and production, general status of wealth, etc.

However, there are real ecus - the international trading currency of the three firstworld trading communities. In the Americas, it's the neodollar. This is the main economic indicator in the Americas. Driven by the growing economic friction between the U.S. and the rest of the hemisphere, the Chilentinan peso shows signs of becoming the basis of a purely South American ecu. This would have a drastic effect on trade balances and international debt for both continents. The American powers are very cautious about radically altering their financial structure, for fear of disturbing economic stability.

The United European ecu is the eurotaler. While originally based on the Euro launched by the European Union, nationalist movements in key countries have reintroduced national currencies; as a result, certain larger nations retain local money as well as the Eurotaler, while smaller nations have shifted entirely over. Eurotalers are eagerly accepted everywhere in Europe, and it is the favored hard currency in northern Africa and the Middle East.

The weakest ecu still used is the nuyen, the ecu supported by the joint economies of Russia and Japan. The economies of the CIS and large portions of the Pacific Rim are tied to the nuyen.

Ecus are nominally at par. That is,one ecu equals $1.00, whether it is a nuyen, a neodollar or a eurotaler. However, even ecus can vary from this ideal value.

Most nations accept at least one of these currencies in addition to their own, although there may be 'currency exchange fees' dealt out to foreigners on holiday (make a Merchant roll; 2d-2 - the amount succeeded by or plus the amount failed by; outright refusal to exchange on a critical failure). Any of these currencies used in general is referred to as ecus.

The financial situation in the world is always anything but steady. Those operating in foreign waters should never be completely comfortable about the safety of their bankrolls. The key to playing games with themoney supply is fluctuation between one currency (the one the person has) and another (the one he needs to get what he wants).

Unless characters try to make a killing by trading in currencies, this usually involves measuring the stability of money compared to the“ideal” ecu. Whenever an adventurer takes money in or pays it out,the GM can check to see if the state of the world's economy helps or hurts him.

The score that controls this is called flux.

Flux measures the degree by which a currency can vary from its face value. Hard currency has a very low rate of flux; when it does fluctuate, it often increases in value. Soft currency, on the other hand, has a very high rate of flux, and it often decreases in value.

Flux is measured by two ratings: a flux number and a letter, the flux class. Higher flux numbers are considered good - thatis, currencies with a high number are more stable. Flux classes are rated A through E. An A or B indicates stable or “hard” currency. Anything C, D, or E indicates unstable or “soft” currency. Class E currency in particular is extremely unstable, subject to wild inflation - “trash cash”, in street jargon.

The flux number and flux class come into play whenever large amounts of money changes hands. Anytime an operator is involved in a significant financial transaction, the GM can require the player to make a flux roll.

The Conversion Factor (CF) for a currency measures how much of that currency it takes to equal $1.

To convert a figure in ecus into another currency, multiply the figure in ecus by the CF for the currency. For example, the Swiss franc has a CF of 2.1. $1 equals 2.1 Swiss francs. An item that costs $100 costs 210 Swiss francs.

To convert a figure in a particular currency into ecus, divide it by the CF. For example, if a fancy personal computer crafted by the techno-gnomes of Lucerne costs 3,200 Swiss francs, and the CF for Switzerland is 2.1, it costs 3,200 divided by 2.1, or $1,524.

As mentioned above, the three ECU currencies, the neodollar, eurotaler and nuyen, all have a CF of 1.00. But not all ecus are created equal, and they have different rates of flux. We'll get to flux in a minute.

Conversion Factors aren't essential. They are included for background color. In game terms, all that matters is the real value of the transaction in ecus. But when a fixer has to lug a barrel of Serbian balkis (1,200 balkis = $1) to a meet in Krusevac, it makes life a little more interesting.

So now that you know a bit more about the value of money, here's a list of countries and major corporations and their effective conversion rate and flux rate. Flux rate will be explained more in a moment, but in short, the higher the number (and the closer to A the letter), the 'stronger' the currency is overall, and the more likely it is to appreciate in value over time (or at least not lose value.)

Flux classes and numbers are assigned using the following criteria.

A: Ecus. Strongest firstworld economies. Major corporate superpowers.

B: Average firstworld economies. Large international corporations.

C: Weak firstworld economies. Strongest lastworld economies. Moderate international corporations.

D: Average lastworld economies. Small international corporations.

E: Weak lastworld economies. Single-country corporations.

16: Very stable currency (dynamic economy, strong balance of trade).

14: Stable currency (growth economy,good balance of trade).

12: Unstable currency (stagnant economy, poor balance of trade).

10: Inflationary currency (economic down-turn, recession).

8 : Trash currency (depressed economy).

Whenever an individual is being paid, or when he buys something, the GM should roll 3d against the flux number for the currency he is using. For example, if a character is paying in U.S. dollars, the roll is against 16, the flux number for that currency. Treat the flux number like a skill for purposes of calculating critical successes or failures. If the roll simply succeeds, then money changes hands at face value. Any other result changes the amount of money involved. The exact amount depends on the currency's flux class.

On a critical success, stable currency is subject to positive flux. The player character gets a percentage of cash in his favor. If someone pays him, he gets more money than usual. If he spends money, then the price of whatever he buys is reduced.

Unstable currency, with a flux class of C or worse, doesn't benefit from positive flux. If the roll fails, that's negative flux, and the exchange rate gets worse for this transaction. The exact percentage depends on the number of points by which the roll failed. If the person is receiving money, the amount is reduced by the percentage. If he is paying someone else, his cost goes up by the same percentage. On a critical failure, add 1d-1 to the margin of failure. That is, if a critical failure misses the flux number by 4, roll ld-1 and add the result to 4 to measure the actual effect of the negative flux. For example, the player rolls an 18 against a currency with a flux value of 16C. This normally would reduce the money's value by 2 x 3%, or 6% (see Flux Class chart, below). But since 18 is a critical failure, he rolls ld-1, adds the result to the 2 points by which the first roll missed, and multiplies that by 3% for a total of up to 21%. Currency transactions can be a royal pain.

A: Positive flux: (2d-2)x5%. Negative flux: 1% per point by which the roll was missed.

B: Positive flux: (1d-l)x5%. Negative flux: 2% per point.

C: Positive flux: Has no effect. Negative flux: 3% per point.

D: Positive flux: Has no effect. Negative flux: 5% per point.

E: Positive flux: Has no effect. Negative flux: 7% per point.

So, you're haggling over a deal and the flux roll comes up lousy. What can you do about it? After all, if the world monetary exchanges are as fickle as we've just described,you couldmaybe go out for a cup of coffee, come back in half an hour, and get a whole new deal,right?

Nice try.

There are two situations to consider here. In the first, and simplest, case, the operator has already agreed to the deal. Backing out is, at the least, going to give him a street rep as a weasel (either temporarily or as an out-and-out Reputation disadvantage). If he pulls it on the wrong people, he may just get killed. If he has agreed to take payment in Turkish liras, he can't change his mind when the lira takes a nosedive, and demand East African kenyattas instead. In general, this happens when the person is getting paid. The flux rolls are made when his employer pays him, whether it is a regular salary from the Jobs Table, or a one-time transaction after some irregular piece of skullduggery for a corporation's “Competitive Research” office. Of course, once he's paid, he's free to sit on the payment and wait for a better exchange rate to roll around, as long as he doesn't have any bills to pay or groceries to buy in the meantime.

When the citizen is paying someone else for goods or services and finds himself on the short end of bad flux, he has more options. He can “walk around the block,” that is, hold off closing the deal, waiting for a more favorable exchange rate.The length of time he'll have to wait before making a new roll depends on the flux class of the currency he's dealing in.

A: 24hours.

B: 2 days.

C: 4 days.

D: 1 week.

E: 2 weeks.

Some purchases are time-sensitive. If you are buying bullets in the middle of a firefight, that's certainly a seller's market. Pay the man, for heaven's sake!

If the deal involved any fancy searching to finda buyer or seller - for example, if a netrunner is negotiating to buy black-market hightech to upgrade his cyberdeck - then walking aroundtheblockmeans that the source of the merchandise will dispose of it elsewhere. The buyer will have to locate a new source of the material.

A person can also play musical money,offering a different currency to avoid a loss due to negative flux.

For example, Heavy Ajax is paying off two mercenaries for a bit of professional violence earlier in the week. The price agreed on was $1,000, in any reasonably hard currency (flux class A or B). Ajax taps into a crow that carries its balance in Israeli shekels, which have a flux of 14B. The dice roll is 17, which is a critical failure. Ajax is loath to fork over extra cash to these wired-up street ops, so he dips into his slush fund, a packet of neodollars stashed in a Seattle variable fund. Neodollars are rated 16A, top-of-the-line in terms of credit. This time, Ajax rolls a 12 and forks over 1,000 neodollars. This may be ill-advised, of course. Neodollars are as hard as currency gets, whereas shekels are less stable; but cashflow is cashflow.

A prudent adventurer or financier will maintain his funds in several accounts, spread over a sampling of several dependable currencies.

Kurse (pronounced “koor-suh”), in Russian, German and a couple of other languages, means “currency exchange rate.” In street lingo, it's pronounced the same as “curse.” If a GM wants to keep players anxious about their savings, this is a sadistically useful tool.

The GM can make a flux roll for any currencies he wants at the beginning of a playing session. Any flux results are in force for the rest of the session. To be really nasty, he can carry flux over from one adventure to the next. Say he rolls against Canadian dollars one evening, and the dollar plunges 3%. Next week, he rolls and gets negative flux on the dollar again, dropping it another 6%. The dollar is now down 9%!

When carrying over negative flux this way, a positive flux roll restores the currency to its face value. That is, it cancels all long-term negative flux in play as the currency restabilizes.

And to top it off, players can still roll for flux on individual transactions as well, using the kurse as the basic rate. Say the dollar is down 9%. If a player gets another 3% of negative flux on a transaction, he is down 12% for that sale.

Another nasty thing to do with the kurse is devaluing currency. Normally, adventurers don't actually suffer reductions in their total savings when hit with negative flux. It only applies to the amount of money they gain or lose on a given transaction. Even when carrying around negative flux, it doesn't affect their bank balance, just the purchasing power of their money. Not so with devaluation!

On a kurse roll of 18, the GM can decide to devalue the currency, using any negative flux. Team members then have to reduce their holdings in that currency by the amount of negative flux. They can't hold on to the money and wait for times to get better.

Devaluing a currency cancels out any negative flux that has built up against it. For example, at the beginning of a session,the GM rolls for the kurse on Nepalese rupees. Previous kurse rolls have already put 6% negative flux against the dollar. He rolls an 18, and knocks the poor, abused rupee down by an additional 14%, for a total of 20%. He also announces that the Nepalese government is adjusting the free-floating value of its existing currency; this is most unfortunate for those who were recently paid by Nepalese corporate interests, as they must adjust the value of their assets downward by 20%. If a citizen had $10,000 in dollars in the bank, his account is reduced to $8,000.

As a rule, trivial transactions, less than $100, should not require flux rolls. However, the GM may decide to call for a flux roll for small purchases once in a while, just to keep players from getting entirely comfortable. Nothing like having a smartcab update its prices in real time, after all, or note that a local Wal-Mart's prices on their favorite soft drink have gone up.

As a general rule, anyone paying in “fold,” real hardcopy cash, can skip flux rolls. That applies to money printed by a government, scrip certificates from a major corporation, or any kind of non-electronic currency. However, if a character converts fold into cred (deposits hardcopy currency for transfer to an electronic account), he should check the flux at that time.

A person's willingness to pay debts in more stable currencies,and to accept less stable currencies as partial payment to himself, can be a critical factor in negotiations about payment.

In areas of high black market traffic and heavy money laundering, most payment for criminal or hard-to-get goods or services is a mix of hard and soft currencies. Standard payments are divided into four equal blocks. One block will be in class-B currency, two will be class-C currency, and the fourth will be class-D currency.

Each block can be negotiated once and once only. The appropriate skills are Merchant (for any situation) or Streetwise (for criminal goods or services). Fast-Talk may be suitable, if the deal has to go down in a hurry, and the player can convince the GM that he has a plausible line.

Roll a Quick Contest between buyer and seller (the person to be paid) for each block to be negotiated.

The seller can try to upgrade the flux class of a block, but this may reduce his effective skill for the Quick Contest.

If the seller wins, he gets his way. If the buyer wins, he may either downgrade the block one flux class, or reduce its real value by 10%.

For example, Vin Slade needs to hire a netrunner. He offers $10,000 to Jumping Jack: $2,500 in class-B deutschmark, $5,000 in class-C Algerian dinars, and $2,500 in class-D Quebecois francs. (Vin is the buyer; Jack is the seller.)

Jack tries to get Vin to improve the offer. They roll a Quick Contest over the deutschmark block. Jack is at -2 on his skill roll, since he is trying to get Vin to upgrade to eurotalers, a class-A currency. Vin wins and Jack is beaten down to taking $2,250 in marks.

Jack switches to an argument over the Quebecois money. He wants to be paid in fold. Jack wins this Quick Contest.

Jack tries negotiating on the$5,000 in Algerian currency, rolling once for the whole five grand, to upgrade it to Swedish krona, a class-B currency. Jack wins.

At this point, all four blocks have been negotiated. So the final deal is $2,500 in Quebecois francs, paid in fold, the rest in electronic cred: $5,000 in krona, $2,250 in deutschmarks.

If this is too complicated for your tastes, a standard Merchant contest can be rolled. The winner gets to raise or lower the overall price by 10% or raise all the blocks one class: one class-A, two class-B, one class-C.

Cred, or electronic currency, can be stored in the Net in several different forms. Each has advantages and disadvantages.

Legitimate citizens - folks with established identities and credcards to prove who they are - use personal, or bank, accounts. The money in a personal account belongs to you, and only you can authorize a withdrawal, using proper ID to verify that the order is legal. If you lose your ID, it can't be used to loot your bank account unless the thief has the necessary resources to overcome the safety checks that verify identity. If your money is stolen from a personal account in spite of these checks, and you can prove that it was stolen, the bank has to refund the loss, under the law in every technologically-developed country on Earth.

So what's so bad about personal accounts? Well, if you don't have a legal identity, you can't use one. Those with the Zeroed advantage can't have a personal account unless they tie it to a Temporary Identity. And any funds allocated to a Temporary Identity are confiscated when the fake ID is discovered. Tax records are automatically registered when money is deposited to a personal account.

In many cases, taxes are automatically deducted from deposits when the income is subject to tax: payment from employment, investment income, payment for freelance work, royalties, etc.

Any transaction paid with cred from a personal account can be traced back to that account, and so to the identity of the account's owner. A Trace program can do this. Keep in mind that programs like this may be illegal for private individuals, but not for banks (and the corporations that own them( or government agencies.

These are reloadable cards that work just like normal credcards, with the only exception being that the card is backed by a bank instead of by an individual, after being loaded with funds via fold at a registered vendor, or cred from an existing personal account. They are essentially the lower-class version of escrow accounts. While private accounts do maintain a record of their activities, it is limited to the information used to acquire the private account - and since many of these cards can be picked up at a store and purchased for $5, then loaded with fold without ever using a personal account or ID, these cards can allow one to operate under the radar for small transactions. However, there are limits: first, the maximum a card can hold is $500, and second, there is a 1% fee on every deposit made, so it's by no means an appropriate solution for major commercial transactions.

These cards are used to hold highly localized forms of currency, such as the amount of money on a laundry card, casino card, or arcade card. They sometimes hold other values; a casino token card might also track perks earned this session, while an arcade card might track tickets earned towards prizes, for example. Usually these are only useful within a single business or business chain, and have a specific purpose in mind (and a specific interface to connect to them), making it more difficult to forge access without the proper hardware.

Blind accounts are not registered to a given individual, but are the equivalent of the numbered accounts offered by the Swiss for centuries. Anyone with the proper code can access the account.

Separate codes are used for deposits and withdrawals. One can safely give deposit codes to other people, to make payments directly into the account. Withdrawal codes are kept very secret. Blind accounts are available in any country with a Control Rating of 3 or less (although the Swiss are still at the top). If a Trace program is fed the deposit code for a blind account, it can trace all monies paid into it back to their source. A Trace program that is given the withdrawal code can trace all withdrawals to their recipients. Remember, though, that banks do not want their transactions traced, and their systems will be loaded with nasty defensive software. And if the software isn't enough,they can always send a hit man out to find the hacker.

Blind accounts charge a 1% service fee on all deposits.

A crow, short for “escrow account,” is similar to a blind account. However, a crow is established with a one-time deposit. It cannot be added to. All records indicating the source of these funds are erased from the Net. The bank that maintains the crow backs it with its own funds.

A crow only has a withdrawal code. It is possible to trace withdrawals from it, but not the original deposit.

Locked crows are even more secure, in one sense,though vulnerable in another. A locked crow is keyed to one,and only one, highly complex passcode algorithm that is stored in a special credcard, a “crowcard.” The crowcard is a dedicated microcomputer running a unique Complexity 2 identity-control program. The withdrawal code is programmed into a resin-sealed, destruct-coded chip onboard the credcard. The card's ID program corresponds to a chip-based program installed in the bank's computer.

The recognition of withdrawal orders is handled by these chips working in tandem through the Net. This redundant, hardware-based security makes it virtually impossible to fake the withdrawal code for a locked crow. You must have the card to get the money.

Locked crows are like fold in this regard. If you lose the crowcard, or it's destroyed, that's it. You lose the money.If someone steals it, he owns the money. A Trace program can only trace withdrawals from a locked crow if it has access to the crowcard that controls it, so that it can identify itself to the bank's computer properly.

There is a service fee of 5% of the amount deposited when a crow is created. In addition, the crowcard costs $200.

For an extra $2,000, a crowcard can be keyed to an individual's thumbprint. This makes the money effectively robber-proof, but also makes it nontransferable, except through withdrawal.