Illyrio's Game

[John Suburbs]

I recently posted this on reddit, so this is not a rip-off but a repost. TL:DR: Illyrio is trying to bring down the Iron Bank and, by extension, Braavos.

The question here is what is Illyrio's motivation in all of his machinations? In Dance, he tells Tyrion that his aim is to be Master of Coin. Really? A man as rich and powerful as Illyrio, already a magister in Pentos, wants to spend the rest of his days counting some else's coppers in Westeros? I think not. I see a much more lucrative benefit here for the pox-ridden cheesemonger, and he is using Westeros as the bait.

The history between Braavos and Pentos is not friendly. The two have fought six wars in the last 200 years, four of them won by Braavos and two by Pentos. The cities of Essos are constantly warring against one another, but wars with Braavos are different because it is not a slave city. After the last war, Braavos commanded Pentos to give up slavery, which it has done in theory but not in practice. And that last war must have really stung for Pentos because they had just won a major battle when the Prince of Pentos suddenly negotiated a peace that forbade slavery, as well as the hiring of sellswords, and placed limits on the Pentoshi army. Rumors of bribery swirled about this whole affair. All of this happened in 209, several decades before Illyrio was born.

So now, Pentos finds itself unable to resist Braavosi dominion openly, and yet it cannot count on support from the other slave cities who are constantly warring against one another. What to do? How about destroy them financially?

Like any bank, the IB is in a constant balancing act between debits and credits. It takes deposits from some people and then loans the money to others with interest. As long as a critical mass of depositors doesn't suddenly withdraw their accounts, it can easily pay the interest to its depositors from the usury it charges on the loans, all the while making the bank wealthy and powerful. The worst thing that can happen is a default on their loans, which is why it is so ruthless when it comes to "getting its due."

But I think we are seeing signs that the IB has over-leveraged itself and is about to get hit with a coordinated run on the bank to drive it into insolvency. First, there are the loans to the Iron Throne, which has now stopped paying even the service on that debt, let alone the debt itself. This is obviously a serious matter for the bank considering it has spent more than a year in King's Landing trying to work out a deal, to no avail. It latest move, after the last rebuff by Cersei, was to call in its loans to merchants in the Seven Kingdoms, creating an economic crisis in the realm. In general, it is a bad sign when a bank starts calling in loans, since it means it is more concerned about shoring up its reserves than making a profit. So my guess is that even if the IT's loans themselves aren't driving the IB's reserves to dangerously low levels, it is one of many losses that has the bank managers worried -- perhaps others related to Astapor and Meereen.

Of course, the IB could merely be calling in other loans to weaken the crown's ability to fight Stannis. In Winds, we learn that

Spoiler

the bank has loaned Stannis the funds to hire sellswords on the promise that he will make good on both his loans and the crown's, which is in perfect keeping with the bank's reputation. But this is a dangerous game. If Stannis fails, they are out his loans and the crown could very well declare their loans to the IB null and void since they backed a rebel. After all, Justin Massy is heading back to Braavos with Tycho Nestoris, where he will immediately put out the call for swords, so there shouldn't be any question as to who gave him the money.

Meanwhile, according to Illyrio's plan, fAegon will be the next king, and fAegon owes nothing to the Iron Bank and would have no reason at all to honor the debts of the previous dynasty.

All this is well and good as far as weakening the bank, but since it has such a fearsome reputation, how is Illyrio going to convince anyone that their deposits are in jeopardy? All it takes to create a panic is for one person step forward saying the bank denied his request for a withdrawal. If Illyrio is smart (and he is), he will have a substantial amount on deposit, which he would likely withdraw before he drops the hammer, thus lowering the banks reserves even further. He may very well have convinced leaders in other slave cities to do the same. Then he would need a patsy with a significant amount from another source to do the same, running the bank dry.

Who might this be? My guess is Littlefinger. I suspect that LF has been Illyrio's agent all along. Illyrio was bankrolling LF's initial success at Gulltown and King's Landing, essentially buying the position of Master of Coin who then built up the substantial debts that the crown owes to the IB (and the Lannisters, who would also be hurt by a default -- not that Illyrio would care), all the while embezzling money from the crown to deposit in the very same Iron Bank. LF might even own shares in the bank by now, giving him visibility into the balance sheet to know the perfect time to close his account.

If all goes according to plan, of course, the IB is left penniless, which means Braavos' main source of wealth backing its iron coin is gone, which leads to default and bankruptcies throughout the city, runaway inflation, and a complete inability to trade on the world stage for perhaps a generation. Even if Pentos does not decide to crush Braavos militarily, it no longer has to abide by the peace treaty of 209, and everything, including slavery and the slave trade, goes back to the way they were in the good old days.

This strikes me as a much more sensible goal for Illyrio than becoming fAegon's Master of Coin.

[Davjos]

I think Littlefinger’s succes with his understanding of basic supply and demand, as explained by both Tyrion in ACOK (I think) and demonstrated by his ‘going long’ on the wheat of the Vale, is sufficient to doubt the fact he needed any bankrolling. 

fAegon’s invasion is unlikely to bring more economic trouble to Bravos then just leaving Bobby to bankrupt 1/3 of the ‘known world’ and afterwards that continent in a constant state of war. I don’t see the motivation of disrupting the IB’s financial position matching with his action of waiting 15 years and having Aegon invade Westeros. And Dany’s disruption of the economy of Slaver’s Bay could not be anticipated in any way by Illyrio. 

[argonak]

In ADWD Illyrio tries to join group, but is turned down.  He's very sad as a result.  His connection to fAegon seems to be emotional rather than financial.  I think Illyrio is fAegon's real father, and he gave up his son to this plan in the hope of the boy being king.

[nyser1]

I do not think Baelish works for Illyrio.

Originally I wondered why Master of Coin would work for him. Then I realized: while his endeavors seem to be global, Pentos (and the Free Cities) are his center. I could see him trying to use Westeros (whether through trade deals or explicitly stealing from the crown) to support his empire. Having potential socio-political & military backing of an entire continent does not hurt either.

[Nevets]

I doubt that the IB has enough invested in Westeros to be an existential threat.  And I think that their calling in of loans is a pressure tactic to force the Crown to start paying again.  The same with Stannis.  They are not only bankrolling a rival, but Nestoris's activities at the Wall are obviously intended to get back to Cersei, so that she knows that they are bankrolling him.

While it is possible that they are overextended elsewhere,, I seriously doubt that they would have investments in slavers bay.  Braavos is militantly anti-slavery.  No way is the IB going to touch Slavers Bay.

[John Suburbs]

21 hours ago, Davjos said:

I think Littlefinger’s succes with his understanding of basic supply and demand, as explained by both Tyrion in ACOK (I think) and demonstrated by his ‘going long’ on the wheat of the Vale, is sufficient to doubt the fact he needed any bankrolling. 

 

He's going long with the wheat in the Vale because he knows winter is coming and food will be scarce. His rise from customs agent to chief of customs to Master of Coin took place in summer.

So let's take it from the beginning: LF is awarded a minor customs sinecure in Gulltown. This is where he first distinguishes himself by bringing in more revenue than any other official, and it would have to be significantly more in order to get noticed. The problem with this is that, unless we think that LF can somehow increase the amount of trade that is coming to him and him alone, the only way he can be generating more revenue is by taking more from the ships that he inspects. So he is either taking more than the customary amount, say 10 percent, or he is making a more accurate assessment of the goods being brought in; either way, he is interfering with the comfortable relationship that traders and revenue collectors have established over the years, which would make him a key target at the docks, which are not known to be places of fair play and honest bartering. It would be very easy to make a trouble-maker like young Petyr disappear.

His next step is chief of customs, where he can now implement these "enhanced revenue" practices across the entire port. This would only make Gulltown a less desirable place to do business than, say, Saltpans or King's Landing, which would only reduce the inflow of goods, creating shortages and driving up prices. Ultimately, this is likely to reduce revenue to House Arryn because they are taking a larger slice of a smaller pie, and discontent will have spread among the merchant classes, and their noble patrons, as the increased cost of raw materials drives up the cost of finished goods like dresses, armor and food.

Next, we get to King's Landing, where, as Master of Coin, he now has broad ability to buy, swap, trade and do all kinds of things with the crown's wealth. By this time, he is probably less dependent on Illyrio for support, but even here the idea that he can store up certain goods, wait until the price rises, and then sell is only likely to breed discontent among the merchants and their patrons. If, say, LF wants to make a killing in silk, then he sends his agents to the docks to buy up all the silk there is. That means no silk for dresses, capes, doublets, or even bandages, despite the fact that load after load of silk is being unloaded every day, only to be hauled away by LF's customs inspectors. That is only going to breed resentment against LF and the crown, particularly after LF starts trickling the silk back into the market and demanding sky-high prices for it.

So none of this makes any sense. If this is what has been happening to all manner of goods -- everything from silk to cotton to wool to iron to wheat -- then the last 10 years of Robert's reign would not be known as a time of peace and plenty, but of want and penury, especially if other traders start trying to game this system by hoarding their own goods in hopes of a price spike. And nobody would be talking about LF as an amiable fellow who gets along with everybody. He would be the king's thief who is making life miserable for everyone else.

The only way to have it both ways is that LF is getting bankrolled and then cooking the books to make it seem like he is a financial genius. And it is telling that the financial shite started to hit the fan for the crown soon after he stepped down as MoC.

 

Quote

fAegon’s invasion is unlikely to bring more economic trouble to Bravos then just leaving Bobby to bankrupt 1/3 of the ‘known world’ and afterwards that continent in a constant state of war. I don’t see the motivation of disrupting the IB’s financial position matching with his action of waiting 15 years and having Aegon invade Westeros. And Dany’s disruption of the economy of Slaver’s Bay could not be anticipated in any way by Illyrio. 

Well, he would have to wait until fAegon was old enough to make a viable king. He is playing a long game here, and it will take some time to weaken the crown's financial state anyway. He needs to have the war, though, in order to hide his tracks. If he just let things slide until the crown could not pay its debts, then the weight of blame falls on Littlefinger, not the wars. And even a bankrupt kingdom would still be beholden to that debt, and thus still be counted as an asset by the bank. But an entirely new dynasty that owes nothing to the Iron Bank would not. This would make the loans unrecoverable, which, combined with the bank's suddenly inability to honor its own debts, would throw it into a death spiral. Remember, the goal here is not just to weaken the bank, but to destroy it.

No, Illyrio could not have anticipated Astapor or Meereen. But since they did happen, it likely impacted the IB in some way, probably not directly but in the ability of some borrowers to repay their loans as well.

[John Suburbs]

21 hours ago, argonak said:

In ADWD Illyrio tries to join group, but is turned down.  He's very sad as a result.  His connection to fAegon seems to be emotional rather than financial.  I think Illyrio is fAegon's real father, and he gave up his son to this plan in the hope of the boy being king.

I'm not sure what you're referring to. What group?

Where do you get the idea that he has an emotional tie to fAegon? But even if he does, the end game for Illyrio still would be to destroy the Iron Bank. That is the entity that has been hold Pentos, and Illyrio, down for the past century. If fAegon does turn out to be his son, then it's a double win for Illyrio, even though he could never capitalize on the relationship, since fAegon has to be Rhaegar's son in order to have a legitimate claim to the throne.

[John Suburbs]

18 hours ago, nyser1 said:

I do not think Baelish works for Illyrio.

Originally I wondered why Master of Coin would work for him. Then I realized: while his endeavors seem to be global, Pentos (and the Free Cities) are his center. I could see him trying to use Westeros (whether through trade deals or explicitly stealing from the crown) to support his empire. Having potential socio-political & military backing of an entire continent does not hurt either.

I think he not only has an historical beef with Braavos, but a personal one as well. Remember the ship that carried the plague to Pentos that ended up killing his beloved Serra? It came from Braavos. Was this just an unfortunate accident? Perhaps, but we have no information that Braavos was suffering from an outbreak of plague at the time . . . 

[John Suburbs]

17 hours ago, Nevets said:

I doubt that the IB has enough invested in Westeros to be an existential threat.  And I think that their calling in of loans is a pressure tactic to force the Crown to start paying again.  The same with Stannis.  They are not only bankrolling a rival, but Nestoris's activities at the Wall are obviously intended to get back to Cersei, so that she knows that they are bankrolling him.

While it is possible that they are overextended elsewhere,, I seriously doubt that they would have investments in slavers bay.  Braavos is militantly anti-slavery.  No way is the IB going to touch Slavers Bay.

They are concerned enough that they've sent envoys to work out a deal. I can't imagine that the loans to an entire kingdom are not far more significant than those to a merchant or trader.

Yes, like I said, it probably is a pressure tactic, but this could very well backfire. If merchants and tradesmen in KL cannot repay these loans immediately, then income to the crown suffers even more and the odds of repayment go down even further. Meanwhile, the IB is no longer earning money on those loans, but merely receiving the loan it made originally. And if recalling a loan drives a merchant to bankruptcy, then it is gone for good. At the end of the day, should the IB be then unable to return a depositor's money, then other depositors might not see this as a pressure tactic but proof that the bank has run dry.

At the same time, if Stannis were to lose, the IB has no one else (except maybe Euron?), while Illyrio has fAegon already in Westeros ready to march on the capital. Should Cersei prevail, she now has no reason to honor the debt to the IB because they were plotting to overthrow her.

They wouldn't have direct interest in Slavers Bay, but as Illyrio says, "the world is one great web, and a man dare not touch a single thread lest all the others tremble." Legitimate goods are routinely traded for slaves, which means the money lost on slaves is money that cannot go to other forms of trade, so traders, merchants and other economic interests are suddenly without the means to pay back loans to the Iron Bank.

[argonak]

54 minutes ago, John Suburbs said:

I'm not sure what you're referring to. What group?

Where do you get the idea that he has an emotional tie to fAegon? But even if he does, the end game for Illyrio still would be to destroy the Iron Bank. That is the entity that has been hold Pentos, and Illyrio, down for the past century. If fAegon does turn out to be his son, then it's a double win for Illyrio, even though he could never capitalize on the relationship, since fAegon has to be Rhaegar's son in order to have a legitimate claim to the throne.

Sorry, I left out a word.  Illyrio wanted to join Griff's group, but was told not to, and Tyrion noticed that it seemed to make him very sad. Thats how I remember it from when I read it last.  With all the hints of Illyrio's wife, the clothes for a young boy, I think its most likely that Young Griff is Illyrio's son and probably a blackfyre through his mother.  Not that this is just my theory, I've seen plenty of other people who shared it.

[Lord Varys]

On 9/9/2019 at 6:38 PM, John Suburbs said:

I recently posted this on reddit, so this is not a rip-off but a repost. TL:DR: Illyrio is trying to bring down the Iron Bank and, by extension, Braavos.

The question here is what is Illyrio's motivation in all of his machinations? In Dance, he tells Tyrion that his aim is to be Master of Coin. Really? A man as rich and powerful as Illyrio, already a magister in Pentos, wants to spend the rest of his days counting some else's coppers in Westeros? I think not. I see a much more lucrative benefit here for the pox-ridden cheesemonger, and he is using Westeros as the bait.

The case of Rego Draz definitely shows that a man like Illyrio Mopatis might want to be Master of Coin in King's Landing. The position is both lucrative and, one assumes, interesting for a man who likes challenges.

George really torched the idea that Varys and Illyrio need an ulterior motive to invest themselves in Westerosi affairs when he gave us a dude who did exactly that - and one who basically has a similar shady background as Varys and Illyrio - in FaB.

If Rego Draz didn't need an ulterior motive, neither do Varys or Illyrio.

Your whole speculation about the Iron Bank being responsible for Braavos' wars with Pentos (or them deciding Braavosi politics) is without basis (the bank is a powerful player in Braavos, but it is not ruling the city), that Illyrio cares about Pentos having lost wars with Braavos in the past (we don't even know whether Illyrio is a Pentoshi by birth or has Pentoshi ancestors), and, most importantly, there is no hint whatsoever that the Iron Bank is hurt to a significant degree by the loans to the Iron Throne - much less that they are invested to any degree in the slave trade.

The Iron Bank is the most significant bank in Western Essos - and it is active in all the Free Cities as well as in Westeros - and its modus operandi (replace defaulting debtors with such who are willing to pay) seems to very effectively ensure that it is never going to get in a serious crisis. One way or another the Iron Bank gets its due. They never cut their losses - the cut up their debtors and replace them with new ones. It is likely a bank on a foundation as solid as iron with net assets equal to those of the Lannisters.

[Lluewhyn]

3 hours ago, John Suburbs said:

I'm not sure what you're referring to. What group?

Where do you get the idea that he has an emotional tie to fAegon? But even if he does, the end game for Illyrio still would be to destroy the Iron Bank. That is the entity that has been hold Pentos, and Illyrio, down for the past century. If fAegon does turn out to be his son, then it's a double win for Illyrio, even though he could never capitalize on the relationship, since fAegon has to be Rhaegar's son in order to have a legitimate claim to the throne.

His stake in this is simply that his son becomes King of Westeros by claiming to be Aegon VI, as Argonak has stated above.

1. Tyrion is given fine clothes to wear when staying at his mansion, although they are fitted for a child and haven't been worn in a few years. This is too odd and specific a point to be random.

2. When Tyrion and Illyrio go to visit Young Griff, Illyrio specifically asks about the boy, and brings up the fact that the boy always liked candied ginger. He is also very despondent when he doesn't get to see young "Aegon" himself.

3. When Tyrion asks him about his motivations, Illyrio gives off a glib explanation, which Tyrion sees through and immediately realizes that there's something more than simple money in this for Illyrio.

4. Illyrio pulls out a picture of his late wife, who has Targaryen features.

5. Tyrion points out that the Golden Company is a Blackfyre legacy and has a history of fighting with the Targaryens, Illyrio responds lamely that one dragon is as good as another, and specifically points out that the Blackfyres are dead through the male line, suggesting that it's a woman who had Blackfyre heritage, i.e. Serra.

Illyrio scheming with Varys to plant an imposter in the Seven Kingdoms for his own family legacy seems more satisfying to me than simply doing stuff to screw with the Iron Bank, which is pretty far removed from most of the story.

 

[The Lord of the Crossing]

There is a big mistake here in thinking everything is coordinated.  Illyrio has his game.  The Iron Bank has its own game.  More likely the two are not connected.  Perhaps Illyrio fancy himself the next Rigo Draz.

[John Suburbs]

22 hours ago, Lord Varys said:

The case of Rego Draz definitely shows that a man like Illyrio Mopatis might want to be Master of Coin in King's Landing. The position is both lucrative and, one assumes, interesting for a man who likes challenges.

George really torched the idea that Varys and Illyrio need an ulterior motive to invest themselves in Westerosi affairs when he gave us a dude who did exactly that - and one who basically has a similar shady background as Varys and Illyrio - in FaB.

If Rego Draz didn't need an ulterior motive, neither do Varys or Illyrio.

Your whole speculation about the Iron Bank being responsible for Braavos' wars with Pentos (or them deciding Braavosi politics) is without basis (the bank is a powerful player in Braavos, but it is not ruling the city), that Illyrio cares about Pentos having lost wars with Braavos in the past (we don't even know whether Illyrio is a Pentoshi by birth or has Pentoshi ancestors), and, most importantly, there is no hint whatsoever that the Iron Bank is hurt to a significant degree by the loans to the Iron Throne - much less that they are invested to any degree in the slave trade.

The Iron Bank is the most significant bank in Western Essos - and it is active in all the Free Cities as well as in Westeros - and its modus operandi (replace defaulting debtors with such who are willing to pay) seems to very effectively ensure that it is never going to get in a serious crisis. One way or another the Iron Bank gets its due. They never cut their losses - the cut up their debtors and replace them with new ones. It is likely a bank on a foundation as solid as iron with net assets equal to those of the Lannisters.

It would seem to me that the example of Rego Draz would cause Illyrio to think twice about becoming MoC, not covet the job. And in any event, it shows that it is much easier for a rich Pentoshi to become MoC through charm and influence than setting the realm to war with itself.

I never said the IB was responsible for the wars, just that with the IB defunct it makes it easier for Pentos to resume its traditional way of life.

The IB is clearly hurt by the loans to the Iron Throne, otherwise they wouldn't send an envoy on a two-year mission to resume payments and then call in its productive loans among Westerosi merchants in retaliation. It is not invested in the slave trade directly, but as Illyrio says, it is all one big global web. Slaves are traded for goods and coin, which means merchants who make their livings selling regular wares are not being paid by their slave-trading customers who are now without income, which means their ability to repay their loans to the IB is diminished. It's all a big circle, and since the IB can in no way ensure that its borrowers' income is not in some way connected to the slave trade -- which exists everywhere south and east of Pentos -- disruption of the that trade will impact the IB to a significant degree.

"equal to the Lannisters." That may not be as solid a statement as you might think. Let's see if we get a PoV from whomever becomes the next Lord or Lady of the Rock before we make any definitive statements about the soundness of Lannister finances. Remember, the Lannisters have loaned even more to the throne than the IB.

Don't be fooled by the PR. Even the biggest financial institutions in the world fall when they overextend themselves. Remember Lehman Brothers? Washington Mutual? Bear Sterns? (almost bankrupt, but bought out at the last minute by JPM), Fannie Mae and Freddie Mac? (bailed out by the US fedgov, otherwise would have failed, literally dragging the entire world economy down with them). All of them were titans of the industry and were considered invincible less than a year earlier.

Right now, the IB's only hope for getting its money back from the IT is Stannis. If he goes, they have no one -- unless it turns out that they are backing Euron as well, but he is clearly a madman, so they would have to be very desperate indeed to turn to him as their last hope.

[John Suburbs]

17 hours ago, The Lord of the Crossing said:

There is a big mistake here in thinking everything is coordinated.  Illyrio has his game.  The Iron Bank has its own game.  More likely the two are not connected.  Perhaps Illyrio fancy himself the next Rigo Draz.

Based on what happened to Draz, I would think Illyrio would be very cautious about become MoC in Westeros.

Pentos was winning the last war with Braavos, but its leader agreed to a negotiated peace with terms that only a conquered state would agree to. That has to stick in the craw of many a Pentoshi, and it is not much different from Weimar Germany.

The Game of Thrones is like a game of cyvasse. Everything is coordinated. Movement of one piece affects the power and influence of the other pieces, and a good player knows how to leverage his power to victory.

[John Suburbs]

20 hours ago, Lluewhyn said:

His stake in this is simply that his son becomes King of Westeros by claiming to be Aegon VI, as Argonak has stated above.

1. Tyrion is given fine clothes to wear when staying at his mansion, although they are fitted for a child and haven't been worn in a few years. This is too odd and specific a point to be random.

2. When Tyrion and Illyrio go to visit Young Griff, Illyrio specifically asks about the boy, and brings up the fact that the boy always liked candied ginger. He is also very despondent when he doesn't get to see young "Aegon" himself.

3. When Tyrion asks him about his motivations, Illyrio gives off a glib explanation, which Tyrion sees through and immediately realizes that there's something more than simple money in this for Illyrio.

4. Illyrio pulls out a picture of his late wife, who has Targaryen features.

5. Tyrion points out that the Golden Company is a Blackfyre legacy and has a history of fighting with the Targaryens, Illyrio responds lamely that one dragon is as good as another, and specifically points out that the Blackfyres are dead through the male line, suggesting that it's a woman who had Blackfyre heritage, i.e. Serra.

Illyrio scheming with Varys to plant an imposter in the Seven Kingdoms for his own family legacy seems more satisfying to me than simply doing stuff to screw with the Iron Bank, which is pretty far removed from most of the story.

 

Yep, I get all that, but just because Griff my be his son does not mean Illyrio is not using this opportunity to weaken the state that has been keeping his city, and his own economic interests, down for all these years.

[Frey family reunion]

On 9/10/2019 at 2:32 PM, Lluewhyn said:

Illyrio pulls out a picture of his late wife, who has Targaryen features.

To be fair, Illyrio’s late wife is from a pillow house in Lys.  What she has are features typically found in Lys, especially among those who may have been bred to enhance their beauty.

Quote

The Lyseni are also great breeders of slaves, mating beauty with beauty in hopes of producing ever more refined and lovely courtesans and bedslaves. The blood of Valyria still runs strong in Lys, where even the smallfolk oft boast pale skin, silver-gold hair, and the purple, lilac, and pale blue eyes of the dragonlords of old. The Lysene nobility values purity of blood above all and have produced many famous (and infamous) beauties.

It’s very likely that Serra’s appearance is because she is from a long line of bedslaves bred to enhance their Valyrian features.

All of this makes me wonder if Young Griff may not have any “royal” lineage, whether Targaryen or Blackfyre, but is instead the son of Illyrio’s beloved wife, a former slave.  But because of his very Valyrian features he looks the part.

[Lord Varys]

6 hours ago, John Suburbs said:

It would seem to me that the example of Rego Draz would cause Illyrio to think twice about becoming MoC, not covet the job. And in any event, it shows that it is much easier for a rich Pentoshi to become MoC through charm and influence than setting the realm to war with itself.

The Draz example shows that a Pentoshi of insane wealth can consider it a great career opportunity to serve as Master of Coin to the King on the Iron Throne. That's all we need to conclude that Illyrio Mopatis could be just be another Rego Draz - and Varys, too, of course.

6 hours ago, John Suburbs said:

I never said the IB was responsible for the wars, just that with the IB defunct it makes it easier for Pentos to resume its traditional way of life.

There is no connection established between the Braavosi policy towards Pentos and the Iron Bank.

6 hours ago, John Suburbs said:

The IB is clearly hurt by the loans to the Iron Throne, otherwise they wouldn't send an envoy on a two-year mission to resume payments and then call in its productive loans among Westerosi merchants in retaliation.

So you are saying they should just write off their losses?! That makes no sense. They are the bank who get their due. If you are a debtor you will either pay or they will replace with a debtor who will pay.

The Iron Bank is willing and, apparently, capable to extends massive additional loans to the pretender Stannis Baratheon with the goal to eventually get back all their investments with interests. If they were crippled by Cersei's reluctance to pay the installments then this would have been evident by now. They could grant Stannis additional loans.

You also do not correctly portray the situation between Cersei/Tommen and the Iron Bank. Cersei never said the Iron Throne wouldn't pay the interest or the loans they owe the Iron Bank - she just stopped the regular payments while she was building the new fleet. In fact, we don't even know whether the Iron Throne was yet returning any of the loans or whether the regular payments were just covering the interest the Iron Bank was taking on the loans.

There is no chance the Iron Bank is going to collapse because one debtor - and not exactly the largest of their debtors to our knowledge - refuses to pay a few installments.

6 hours ago, John Suburbs said:

It is not invested in the slave trade directly, but as Illyrio says, it is all one big global web. Slaves are traded for goods and coin, which means merchants who make their livings selling regular wares are not being paid by their slave-trading customers who are now without income, which means their ability to repay their loans to the IB is diminished. It's all a big circle, and since the IB can in no way ensure that its borrowers' income is not in some way connected to the slave trade -- which exists everywhere south and east of Pentos -- disruption of the that trade will impact the IB to a significant degree.

There is no indication the Iron Bank is part of that particular web and it is actually not very reasonably to assume the Braavosi of all people would invest in enterprises which are to various degrees dependent on a functional slave trade.

They certainly would invest in enterprises that take place within the established slavery infrastructure, but chances are very low that the Iron Bank is affected in any way by the events in Slaver's Bay - especially not at that point when the only thing that can have reasonably happened in a couple of months is that people cannot expect new slaves from Slaver's Bay to arrive - those already in bondage and in service in the various Free Cities won't go anywhere. Thus only the businesses (i.e. slave traders themselves) who earn money importing slaves from Slaver's Bay should have financial problems. And those would not people who are granted loans by the Braavosi.

6 hours ago, John Suburbs said:

"equal to the Lannisters." That may not be as solid a statement as you might think. Let's see if we get a PoV from whomever becomes the next Lord or Lady of the Rock before we make any definitive statements about the soundness of Lannister finances. Remember, the Lannisters have loaned even more to the throne than the IB.

George has gone on record stating that the Lannisters are as rich as he has described them in his books so far.

6 hours ago, John Suburbs said:

Don't be fooled by the PR. Even the biggest financial institutions in the world fall when they overextend themselves. Remember Lehman Brothers? Washington Mutual? Bear Sterns? (almost bankrupt, but bought out at the last minute by JPM), Fannie Mae and Freddie Mac? (bailed out by the US fedgov, otherwise would have failed, literally dragging the entire world economy down with them). All of them were titans of the industry and were considered invincible less than a year earlier.

Neither of them were sitting on a shitload of cash they just have to mine out of the their own home. The Lannisters can throw ten million gold dragons out of the window and just go down in the basement and get themselves another ten million.

6 hours ago, John Suburbs said:

Right now, the IB's only hope for getting its money back from the IT is Stannis. If he goes, they have no one -- unless it turns out that they are backing Euron as well, but he is clearly a madman, so they would have to be very desperate indeed to turn to him as their last hope.

The fact that they still can back Stannis is all the evidence we need that they have no financial problems. Instead, they are making a point there. They are showing the world that you better do not cross the Iron Bank. If you do, you will fall even if you are the King or Queen of Westeros.

[John Suburbs]

16 hours ago, Lord Varys said:

The Draz example shows that a Pentoshi of insane wealth can consider it a great career opportunity to serve as Master of Coin to the King on the Iron Throne. That's all we need to conclude that Illyrio Mopatis could be just be another Rego Draz - and Varys, too, of course.

There is no connection established between the Braavosi policy towards Pentos and the Iron Bank.

So you are saying they should just write off their losses?! That makes no sense. They are the bank who get their due. If you are a debtor you will either pay or they will replace with a debtor who will pay.

The Iron Bank is willing and, apparently, capable to extends massive additional loans to the pretender Stannis Baratheon with the goal to eventually get back all their investments with interests. If they were crippled by Cersei's reluctance to pay the installments then this would have been evident by now. They could grant Stannis additional loans.

You also do not correctly portray the situation between Cersei/Tommen and the Iron Bank. Cersei never said the Iron Throne wouldn't pay the interest or the loans they owe the Iron Bank - she just stopped the regular payments while she was building the new fleet. In fact, we don't even know whether the Iron Throne was yet returning any of the loans or whether the regular payments were just covering the interest the Iron Bank was taking on the loans.

There is no chance the Iron Bank is going to collapse because one debtor - and not exactly the largest of their debtors to our knowledge - refuses to pay a few installments.

There is no indication the Iron Bank is part of that particular web and it is actually not very reasonably to assume the Braavosi of all people would invest in enterprises which are to various degrees dependent on a functional slave trade.

They certainly would invest in enterprises that take place within the established slavery infrastructure, but chances are very low that the Iron Bank is affected in any way by the events in Slaver's Bay - especially not at that point when the only thing that can have reasonably happened in a couple of months is that people cannot expect new slaves from Slaver's Bay to arrive - those already in bondage and in service in the various Free Cities won't go anywhere. Thus only the businesses (i.e. slave traders themselves) who earn money importing slaves from Slaver's Bay should have financial problems. And those would not people who are granted loans by the Braavosi.

George has gone on record stating that the Lannisters are as rich as he has described them in his books so far.

Neither of them were sitting on a shitload of cash they just have to mine out of the their own home. The Lannisters can throw ten million gold dragons out of the window and just go down in the basement and get themselves another ten million.

The fact that they still can back Stannis is all the evidence we need that they have no financial problems. Instead, they are making a point there. They are showing the world that you better do not cross the Iron Bank. If you do, you will fall even if you are the King or Queen of Westeros.

But why would he want to be? And why do it by setting fire to the realm rather than just cultivating relationships the way Rego did? And once Rego became MoC and basically restored the crown's finances, what thanks did he get? He was shunned by the nobility, hated by the commoners, both poor and wealthy alike, and finally got his head bashed in by a starving mob who blamed him for bringing the Shivers to the city. Why on earth would any man want to follow in those footsteps?

There doesn't need to be a connection in policies. The bank is the backer of Braavosi wealth. Destroy it and you throw Braavos into turmoil. This is not about revenge against the bank. It is about destroying Braavos' ability to further dominate Pentos.

Even if they don't formally write off their losses, the moment someone tries to cash out their deposits and the bank refuses, there is a run on the bank as everybody tries to get their money out. Regardless of whether the loan to the IB is still considered active or not, there is no more money in the IB vaults and the bank goes into default. That's the way it is with banks, large and small.

Yes, they are willing to extend even more loans to Stannis. And if Stannis succeeds, all is well. They start getting payments for both loans. If Stannis fails, however, then they are out both loans, the IB's and now Stannis' "massive additional loans."

Cersei is not paying anything on the loans, neither principal nor interest:

Quote

"This is more properly a matter for our lord treasurer."

That answer did not please the noble Noho, it would seem. "I have spoken with Lord Gyles six times. He coughs at me and makes excuses, Your Grace, but the gold is not forthcoming."

snip

"King Robert . . ."

" . . . is dead," she said sharply. "The Iron Bank will haves its gold when this rebellion has been put down."

There is no gold going to the Iron Bank, otherwise they would be happy to just collect the interest and let the principal sit for a while. The situation is so serious that they are now strong-arming the merchants to put pressure on the crown, which, as I said, could very easily backfire on them.

But we are not talking about one debtor, are we. The Iron Throne and Stannis are two, plus all the merchants in Westeros, plus whomever goes into default because the cash flowing from the slave trade has been disrupted. This could literally be the very kind of perfect storm that has brought down powerful banks in our own history.

How are the Braavosi supposed to enforce a no-slavery ban on all the traders they loan to? Even if that trader does not touch slavery himself, he may bring cheese from Pentos to King's Landing, luxury goods to Saltpans or White harbor, ore or wood to Volantis and oops, guess what, there is no money to buy wood because the city's chief commodity, slaves, are no longer being bought in Meereen -- or even worse, a slave uprising in Volantis (and Myr, and Lys and Tyrosh) has closed down all the ports. It is simply not possible to isolate the slave trade from all the other kinds of trade. Money travels in circles, and slavery is probably the chief driver of wealth for the entire asioaf economy. The money that slave traders are no longer making in Slaver's Bay is money that is no longer buying other goods that non-slavers have purchased using credit from the Iron Bank. There are no single, particular webs. It is all one big web.

Lol, "as rich as he has described them in his books so far." And when their hold on the Iron Throne is gone and the new dynasty has no reason at all to honor the debts of the old, the Lannisters will be quite a bit poorer then they've been described in the books so far. And again, let's see if we get any POVs from Casterly Rock before we conclude that they have 10 million dragons just lying around doing nothing in the basement.

Money for a few companies of sellswords is peanuts compared to the millions it has given the IT. They probably could have covered that with the miniscule infusion they got from the wildlings. And if they are showering Stannis with massive additional loans as you say, that just further extends their leverage to a man and a cause that could very well be gone in a few months.

 

 

[Lord Varys]

12 minutes ago, John Suburbs said:

But why would he want to be? And why do it by setting fire to the realm rather than just cultivating relationships the way Rego did? And once Rego became MoC and basically restored the crown's finances, what thanks did he get? He was shunned by the nobility, hated by the commoners, both poor and wealthy alike, and finally got his head bashed in by a starving mob who blamed him for bringing the Shivers to the city. Why on earth would any man want to follow in those footsteps?

Nobody said anything about Rego's footsteps - Illyrio and Varys might not even know that Rego Draz existed. The point is that his example shows that up-start cheesemongers have no issues involving themselves in Westerosi politics and/or serving on the Small Council of a Westerosi king. Apparently that kind of thing is or can be very lucrative even for them.

One assumes that the Draz clan greatly increased their fortune precisely because Rego was part of the government of the Seven Kingdoms.

12 minutes ago, John Suburbs said:

There doesn't need to be a connection in policies. The bank is the backer of Braavosi wealth. Destroy it and you throw Braavos into turmoil. This is not about revenge against the bank. It is about destroying Braavos' ability to further dominate Pentos.

But we have no indication that the Iron Bank is necessary for the stability of Braavosi politics. Perhaps the state and its military and navy is not dependent on their loans to the degree you imagine it to be?

12 minutes ago, John Suburbs said:

Even if they don't formally write off their losses, the moment someone tries to cash out their deposits and the bank refuses, there is a run on the bank as everybody tries to get their money out. Regardless of whether the loan to the IB is still considered active or not, there is no more money in the IB vaults and the bank goes into default. That's the way it is with banks, large and small.

And where is the indication that anybody is running on the Iron Bank? There are none. Instead, the bank throws another large loan on a doomed pretender who is likely going to fail. They would not do that if they didn't have money left. Stannis is going to need hard cash to hire sellswords or bribe lords in Westeros.

12 minutes ago, John Suburbs said:

Cersei is not paying anything on the loans, neither principal nor interest.

Yeah, but she is not cancelling the debt. She just stopped paying the installments for the time being, she never said the Iron Throne would not pay at all. Which means the whole thing is not even remotely that big of a deal you desperately try to make it. If it were then the Iron Bank would have to be as poor as to go defunct simply because some installments do not come in at the appointed time. And that's a ridiculous idea. If that were the case then they could not possibly afford to throw new money at Stannis who is in no shape right now - and perhaps for years to come - to pay either interest or principal.

12 minutes ago, John Suburbs said:

There is no gold going to the Iron Bank, otherwise they would be happy to just collect the interest and let the principal sit for a while. The situation is so serious that they are now strong-arming the merchants to put pressure on the crown, which, as I said, could very easily backfire on them.

No, what they are doing is to show the Westerosi that you don't mess with Don Corleone. You cross the Iron Bank at your peril. They are setting an example.

FaB made it clear that not even Jaehaerys I could risk the ire of the Iron Bank of Braavos.

It is also quite clear that the Iron Bank has certain ways to ensure their enemies all die. When pushed the Faceless Men should kill so many pretenders and heirs and claimants until one comes up who values his own life - and the lives of his family - more than the money he owes the Iron Bank.

12 minutes ago, John Suburbs said:

But we are not talking about one debtor, are we. The Iron Throne and Stannis are two, plus all the merchants in Westeros, plus whomever goes into default because the cash flowing from the slave trade has been disrupted. This could literally be the very kind of perfect storm that has brought down powerful banks in our own history.

Or not. At this point there is no indication the Iron Bank cares about any of that. And it is quite clear that all the merchants and traders in Westeros who are pressured by the Braavosi will return the money they owe them.

12 minutes ago, John Suburbs said:

How are the Braavosi supposed to enforce a no-slavery ban on all the traders they loan to? Even if that trader does not touch slavery himself, he may bring cheese from Pentos to King's Landing, luxury goods to Saltpans or White harbor, ore or wood to Volantis and oops, guess what, there is no money to buy wood because the city's chief commodity, slaves, are no longer being bought in Meereen -- or even worse, a slave uprising in Volantis (and Myr, and Lys and Tyrosh) has closed down all the ports. It is simply not possible to isolate the slave trade from all the other kinds of trade. Money travels in circles, and slavery is probably the chief driver of wealth for the entire asioaf economy. The money that slave traders are no longer making in Slaver's Bay is money that is no longer buying other goods that non-slavers have purchased using credit from the Iron Bank. There are no single, particular webs. It is all one big web.

Claims Illyrio Mopatis. The Braavos stance on slavery is crystal clear. Chances are that their main bank does not invest in enterprises that are based on slavery, no matter what you think they would have to do.

12 minutes ago, John Suburbs said:

Lol, "as rich as he has described them in his books so far." And when their hold on the Iron Throne is gone and the new dynasty has no reason at all to honor the debts of the old, the Lannisters will be quite a bit poorer then they've been described in the books so far. And again, let's see if we get any POVs from Casterly Rock before we conclude that they have 10 million dragons just lying around doing nothing in the basement.

They are literally living in a house of gold, as the Asshai'i believe - a huge rock full of gold they just have to get out of the rock. If a Lannister wants to make some money he can just go down in the basement with a pickax.

We don't need any Casterly Rock POVs to know that the Lannisters are as wealthy as they seem to be - Tyrion Lannister, Cersei Lannister (who is the Lady of Casterly Rock since AFfC), Jaime Lannister, and Kevan Lannister are more than enough.

12 minutes ago, John Suburbs said:

Money for a few companies of sellswords is peanuts compared to the millions it has given the IT. They probably could have covered that with the miniscule infusion they got from the wildlings. And if they are showering Stannis with massive additional loans as you say, that just further extends their leverage to a man and a cause that could very well be gone in a few months.

What millions are you talking about? Robert was six million in debt, three owed to the Lannisters, roughly a million to the Faith (which the High Septon forgave in AFfC), and the rest to House Tyrell and, presumably, the Iron Bank.

It might be another million, but perhaps not even as much as that.

And that's just not all that much money.