The iron bank will go bankrupt

[Shi Qiang]

On 12/11/2018 at 7:01 PM, The Transporter said:

Many of the depositors were slave owners.  Many of these will die when the slaves rebel in Volantis.  The Iron Bank will just transfer these to its own accounts.  

Yes they would.

[aryagonnakill#2]

I think many people forget how small the debt the Iron Throne owes the Iron Bank is, because the abomination embellished it.  In the books, the crown starts of 6 million in debt.  3 million of that is to the Lannisters, and a million is to the church.  That leaves 2 million in debt, spread around between rich westerosi lords, Tyroshi bankers, Penthosi merchants, and the Iron bank.  Really we should not consider the debt larger than 500,000 gold dragons.  

It also would not have increased during the war, other than to accrue interest since payments were not being made.  Since KL was blockaded until the war was basically over, there was no way for the crown to be borrowing money, this is why Joffrey was never able to raise an army from the crownlands.  They couldn't feed/pay for it.

In terms of paying off the debt, whoever wins in the end, if not a Lannister, will surely cancel the debt owed to them in light of their repeated treason.  Reducing the overall debt by 3/5ths, since Cersei already got the faith to remove their portion.  This will make the remaining portion, including the Iron banks, easy to pay.

[Jon_Stargaryen]

On 12/10/2018 at 4:47 PM, Sigella said:

Slavery isnt an economic system though. Forced labour mightbe, but itsanother thing anyway.

Plus, of all the banks in Essos the Iron Bank is the one least likely to be involved in the slave trade.

Also societeis dont crumble due to slavery being abolished but rather the opposite. 

I don't think the OP was saying that slavery is an economic system, but that the collapse in the slave trade will lead to a collapse in the economy surrounding slaver's bay, seeing as all of their labor is done through means of free labor.

On that note, we only get information regarding the world of ASoIaF from the viewpoints of the POV character of the moment.

We know that the Iron Bank will fund the people with the best prospects of winning the throne and getting them their money. If the people on the throne don't pony up the cash, they will fund the people trying to replace them, which is how Stannis got their endorsement.

The pattern of thought in this is that Aegon - who doesn't have dragons - would likely rather pay the Iron Bank, rather than have them backing one of his numerous enemies - the Baratheon(s), Lannisters and possibly the Tyrells.

In this case, he'll likely snub the Lannisters and Tyrells, who are owed far more than the Iron Bank - of the six million, the Lannisters own three million, one million is owned by the faith, and the Tyrells, the Iron Bank and others SHARE the last two million and change - and make concessions to the Faith.

Now, to address the question of bankruptcy, the Iron Bank doesn't even have the largest share of the debt owed to the crown, which is odd considering that they are a fear banking institution. This leads me to believe that the Iron Bank is backing Stannis out of principle at this point, given that the Lannister faction is snubbing them on a sizable loan, and their reputation is the only reason that they always have their due.

If you allow someone to stiff you on their tab - if you allow someone to steal from you - others might follow suit.

[Sigella]

12 hours ago, Jon_Stargaryen said:

I don't think the OP was saying that slavery is an economic system, but that the collapse in the slave trade will lead to a collapse in the economy surrounding slaver's bay, seeing as all of their labor is done through means of free labor.

On that note, we only get information regarding the world of ASoIaF from the viewpoints of the POV character of the moment.

We know that the Iron Bank will fund the people with the best prospects of winning the throne and getting them their money. If the people on the throne don't pony up the cash, they will fund the people trying to replace them, which is how Stannis got their endorsement.

The pattern of thought in this is that Aegon - who doesn't have dragons - would likely rather pay the Iron Bank, rather than have them backing one of his numerous enemies - the Baratheon(s), Lannisters and possibly the Tyrells.

In this case, he'll likely snub the Lannisters and Tyrells, who are owed far more than the Iron Bank - of the six million, the Lannisters own three million, one million is owned by the faith, and the Tyrells, the Iron Bank and others SHARE the last two million and change - and make concessions to the Faith.

Now, to address the question of bankruptcy, the Iron Bank doesn't even have the largest share of the debt owed to the crown, which is odd considering that they are a fear banking institution. This leads me to believe that the Iron Bank is backing Stannis out of principle at this point, given that the Lannister faction is snubbing them on a sizable loan, and their reputation is the only reason that they always have their due.

If you allow someone to stiff you on their tab - if you allow someone to steal from you - others might follow suit.

 

On 12/16/2018 at 12:41 AM, Sigella said:

Yes, there are lots of positives to economy. Slaves are products but freedmen are consumers, imagine all the stuff all the the freedman will suddenly have to pay for and all he will now produce on the books and put it all together there would be a dramatic rise to everyones coffers. Same like countries where women and men both work - they have a ridiculously big economic advantage just because housewives don't do anything "on the books" either.

 

[Legitimate_Bastard]

Bankruptcy of the IB? I don't see that happening.

Too big to fail. IB would get a GM style bailout from Braavos before that happened. I doubt an institution of such magnitude would put all their eggs in one basket.

[nyser1]

They don't seem like the kind of folks to sit on their hands while people default on their payments. They will certainly have a few new faces in assets at the very least...

[Rose of Red Lake]

The historical banks you bring up is definitely something to consider. But I think Westeros is in far worse shape if the bank fails. How will they rebuild? 

That's why I think it's more likely that the bank is a check on power and a plot device to swing the throne to Jon. Thus far he's the first person to have met a representative from them in his storyline. 

[HexMachina]

5 hours ago, Rose of Red Lake said:

The historical banks you bring up is definitely something to consider. But I think Westeros is in far worse shape if the bank fails. How will they rebuild? 

That's why I think it's more likely that the bank is a check on power and a plot device to swing the throne to Jon. Thus far he's the first person to have met a representative from them in his storyline. 

Cersei also met an IB rep

[Sigella]

12 hours ago, Rose of Red Lake said:

The historical banks you bring up is definitely something to consider. But I think Westeros is in far worse shape if the bank fails. How will they rebuild? 

That's why I think it's more likely that the bank is a check on power and a plot device to swing the throne to Jon. Thus far he's the first person to have met a representative from them in his storyline. 

Yes its gonna make some real difference considering all the gardening its gotten. I think the IB would prefer a claimant that isn't powerful (or bullheaded) enough to say "I'm not paying the Userpers debts" or "The Iron Bank will have its due after the war is done" so that speaks in Jon's favour.

I'm real curious how this will play out  

7 hours ago, HelenaExMachina said:

Cersei also met an IB rep

And Asha. Maybe Davos or is that just an abomination thing?

Spoilers Winds of Winter excerpts:

Spoiler

Theon and Arya (kind of) too.

 

[The Fattest Leech]

In addition to Cersei having interacted with an IB rep, it is suspected that Wyman Manderly also has. And I think there is a line somewhere (also a Cersei chapter?) that says that the IB is traveling across Westeros to collect all of their individual debts?

A Dance with Dragons - Davos II

The merman of House Manderly was everywhere in evidence, flying from the towers of the New Castle, above the Seal Gate, and along the city walls. At Eastwatch, the northmen insisted that White Harbor would never abandon its allegiance to Winterfell, but Davos saw no sign of the direwolf of Stark. There are no lions either. Lord Wyman cannot have declared for Tommen yet, or he would have raised his standard.

The dockside wharves were swarming. A clutter of small boats were tied up along the fish market, off-loading their catches. He saw three river runners too, long lean boats built tough to brave the swift currents and rocky shoots of the White Knife. It was the seagoing vessels that interested him most, however; a pair of carracks as drab and tattered as the Merry Midwife, the trading galley Storm Dancer, the cogs Brave Magister and Horn of Plenty, a galleas from Braavos marked by her purple hull and sails …

… and there beyond, the warship.

[Rose of Red Lake]

10 hours ago, HelenaExMachina said:

Cersei also met an IB rep

LoL that's right. She dismissed him so fast I completely spaced on that interaction.

 

[lomiller]

An interesting thing about banks is that most of the money they lend ends up back in the bank (or at least a bank) the even though the debt still exists. 

 

Something similar likely happened here.  Most of the money lent by the Iron Bank probably ended up in Braavos via trade, and the Braavosi most likely deposited it in the Iron Bank, invested it in the Iron Bank, or used it to pay back loans with the Iron Bank.