A Weapon Too Terrible To Use


Welcome, operative of the Imperial Exchequer.

If you are reading this document, it is because you either have need to know for, or have independently discovered, the weaponizability of the currency validation system.

To recap: the modern esteyn possesses full verifiability against counterfeiting, since every individual currency unit possesses an embedded cryptographic signature incorporating its denomination and serial code. This applies to both physical currency, in which this signature is embedded in v-tag format, and to money of account; an esteyn-denominated account must record not only the quantity of money contained therein, but the unique cryptographic signatures of each esteyn-unit stored. In either case, such units can be verified as genuine by an authentication exchange conducted across the Imperial Banking & Credit Weave.

We retain the ability to generate new cryptographic signatures and to invalidate old signatures at will. This latter facility is used principally by the Office of the Mint when replacing worn-out, damaged, or lost physical currency, and by the Office of Currency and Values, when adjusting the total money supply (i.e., to draw down the money supply, the OCV invalidates the signatures of selected esteyn-units presently in the general account of the Exchequer).

The realization you may have come to is simply that we do not require possession of a group of esteyn-units in order to invalidate their signatures; we merely require their serial codes. As such, we can invalidate any quantity of esteyn, anywhere in the galaxy “by remote control” – revoking its status as legal tender and a store of value, and rendering it useless in transactions anywhere in the legitimate economy.

This capability has never been used.

It is conceivable that one day we may receive an executive order to weaponize this functionality for use against terrorists, slavers, rogue polities, criminal organizations, or others misusing Imperial currency. It is, naturally, far more flexible than seizure of accounts (possible in Imperial banks or those of close allies only) or transactions (which requires that said transaction clear directly through the Imperial Banking & Credit Weave) inasmuch as it can revoke any esteyn-units, even those instantiated as physical cash. For these reasons, we retain the technical capability.

However, the projected economic effects of exercising this capability would be very severe. Much of the galactic market can be modeled as imperfectly trusting, irrational, and/or panic-prone, and the use of this capability would undoubtedly lead to an immediate external market crash, extending into a medium-to-long term depression. As a matter of policy, the Exchequer considers this a circumstance to be sedulously avoided.

As a final note, while the existence of this capability is not a secret (note the classification level of this document) since it is readily comprehended by anyone who makes a sufficiently adequate study of the relevant public protocol definition documents, the Exchequer chooses not to advertise its existence widely in the sight of economic knowlessmen. As such, you should consider it sensitive data, not for casual public dissemination.


Trope-a-Day: We Will Spend Credits in the Future

We Will Spend Credits in the Future: While somewhat played straight out towards the Rim Free Zone with its ergcred, a currency whose name is never abbreviated at the front, for the most part we will spend exvals in the future.  (See: Global Currency).

This may have something to do with the way that those proposing currencies named “credit” were, somehow, all accidentally lynched by rampaging mobs of accountants who knew exactly where this would end up. Like the trope example says:

“So as you can see, on 10 June we credited 35 credits to your line of credit and debited 7 credits from your debit card. Then we debited 8 credits from your line of credit and credited 14 credits to your debit account.”


Questions: Economy and Habitats

Got some more questions! Jamie asks:

It strikes me as odd that at the technological level the Eldrae work at that they appear to be working under an ideal capitalist system in an era of post scarcity technology. How is wealth determined? What is the currency based on? What kinda of inequality is there if any?

Well, the thing to bear in mind about “post-scarcity” societies is that virtually all of them are actually only “post-material-scarcity” (or “nearly-post-material scarcity”, which is how I’d describe the Core Economic Zone polities and regions in the Eldraeverse.) Some things tend to remain scarce – ideas (especially if we assume that inventors, designers, authors, and so forth like to be paid for their work for reasons over and above what the money can buy them, which as an author, I’m pretty sure of), personal services, availability (only so many people can attend X event), etc., etc.

This is true even if we step out of my universe and examine the ur-post-scarcity example, Iain Banks’s Culture, in which a plot driver running through many of the books is the competition to get into Contact, or Special Circumstances, which by no means takes even all the qualified people who want to get in. In Look to Windward, we also see the case of a live concert timed to match the light from a particular supernova – and thus obviously limited to only that one particular place and time and audience – cause such perceived scarcity that even the people who are very smug about “money is a symptom of poverty” immediately reinvent scarcity economics and trading favors in the quest for tickets.

So that’s why they still need an economic system. (Well, that, and nearly-post-material-scarcity only means that mining, generating, and manufacturing is super-cheap, not free, because it still takes energy and thought to do – thermodynamics, it is a bugger. People may only be paying the equivalent of $20/month, easily covered by the Citizen’s Dividend, for the right to manufacture a giant pile of consumer goods every day, but that trivial cost is still there on the back-end.)

As for capitalism – well, now, I find that something of an unfortunately loaded term in *here*’s politics, so I try not to use it to describe things *there*. Their system is both propertarian – inasmuch as it esteems private property, and makes great use of property rights in various areas – and agorist – making use of free markets (which, given their views on the essential nature of consent, is close to the only ethically permitted option).

When I say “loaded”, of course, one of the things I mean is that people assume that capitalism includes only for-profit corporations (which the Empire’s system doesn’t – as the link above says, CEZ economies have an extensive agalmic component, and usually support healthy gift economies, open source communities, alternative internal economic arrangements (co-operatives, ecodemocracies, etc., etc.), the bounty economy, the street performer protocol (like Kickstarter), etc., with wage-based employment (which is almost nonexistent outside indenture – see here, here, and here). It is, if you will, also a free market in free market types.

…and it stays that way, essentially, ethical issues aside for the moment, because the Empire got to become a wealthy nearly-post-material-scarcity civilization by being organized that way, and the wise man does not kick away the ladder that got him where he is today. Especially if he’s still standing on it.

As for how the currency’s based, there’s a good explanation of that here (look down in the article; the first part covers why it’s Very Much Not Gold). It’s essentially fiat, but a peculiar kind of independent fiat designed to match the currency base accurately to the production capacity of the economy (because inflation is a form of robbing creditors to pay debtors, and deflation is a form of robbing debtors to pay creditors, and that is just not on, no sir).

As far as inequality is concerned, I can do no better than point you at the explanation here: Trope-a-Day: No Poverty.

The other thing that seems odd is that they are very planet focused and mentions of space habitats of all shapes and sizes seems rare. How common are Eldrae habitable worlds? What makes planets more useful than more energy and resource efficient habitats? How have they varied the basic habitat designs?

Um, not sure where you’re getting that from. I seem to recall more than a few mentions of one habitat or another, and canonically about three-fifths of the Imperial population are spacers, only two-fifths living on planets. (By no means all of which are habitable, if by that you mean “shirt-sleeve habitable”; most of the populated planets in the Worlds are partially-terraformed Mars-type worlds, which are actually much easier to deal with than existing garden worlds, habitability-wise.) There’s a certain bias towards garden worlds in the Thirteen Colonies, back in the Imperial Core, because of the preferences of the old subluminal colonization days, but in general, it’s not so; and the list of “habitables” tends to include worlds like Sialhain (Venus-like, colonized in aerostats), and Galine (Titan-like), and so forth.

As for why planets – why not planets? People started out being used to them. Sometimes people like seeing landscapes that someone doesn’t have the architectural plans for, or smelling a few trillion tonnes of aeon-old biomass on the wind. (Or maybe they just like wind, who knows?) Or, y’know, because planets have oceans, and while there are aquatic habitats,  you’re not getting the cetacean uplifts out of the Big Puddles any time soon. It’s not a decision anyone’s making out of questions of efficiency, being nearly-post-material-scarcity, and all; it’s a decision people make because they feel like it, and why not?

As a side note: garden worlds are also extremely useful and valuable because they have ecologies, which are very information-dense. And even in the most crassly commercial sense, an ecology is a giant library-cum-research-program of new biotechnological and nanotechnological tricks to draw from. It’s just good business.

(Outside the Empire and other transsophont cultures, of course, many people live primarily on planets because they’re too Luddite or biochauvinist to modify themselves to live comfortably long-term in microgravity. But, hey, someone’s got to be the meek who inherit the Earth, right?)

Habitat-wise: well, I’m going to keep the details under my hat a bit until we see them in fic, but teaser-wise, what I will say is that while there are some O’Neill cylinders and the like, the majority of them could be classified as modular structures or asteroid beehives, operating in microgravity – and even the cylinders tend to operate under low spin gravity. After all, why live on a faux planet when there are plenty of real planets around? Spacers prefer to live spacer-style among spacer-style architecture, by and large.

Money, What Does It Look Like?

So, this is something that I posted to one of the worldbuilding lists I’m on, for sundry reasons, and so I thought I’d post it here too: if you’ve ever, at various times in the past when I’ve mentioned money, or at least physical money, wondered just what it looks like – well, now you know.


Despite the modern prevalence of virtual, digital currency, the Empire still issues ‘paper’ notes and coins. The current issues are designed to be difficult to counterfeit, to be long-lasting, and to be convenient to carry. This physical currency is produced in three media: coins, bills and certificates (a.k.a. super-bills). For these purposes, the standard unit of currency is the esteyn, divided into twenty-four lumenis, each divided into twelve selenis each (288 selenis to the esteyn). There is also a larger denomination, the arien, equal to six esteyn.

Each esteyn coin, bill, and certificate is imprinted with the legend, “By Our Imperial Word, One Esteyn” (or whatever the denomination happens to be). Most people leave it there, but were you to go to the Exchequer and ask, “Ah, what word exactly?”, what they would tell you is that the guarantee is that what Yesterday’s Esteyn would buy, Today’s Esteyn will buy, and what Today’s Esteyn bought, Tomorrow’s Esteyn will also buy; that is, that it’s a reliable store of value that doesn’t have an accidental or deliberate inflationary or deflationary trend to it.

Each of these possesses a unique digital signature embedded within the medium; a v-tag – designed to only be operable at short range to prevent thieves from using it to detect concentrations of money – can return the unique signature of each currency unit, including its denomination as well as its serial code, when queried, and each unit can also be checked for validity against the Imperial Banking & Credit Weave.


Coins are used for all denominations below and including the arien. These coins are struck from a proprietary coin-metal alloy by the Office of the Mint; this alloy is extremely hard and readily takes tinct, and contains signature trace elements designed to be unique to Imperial coinage. The coins themselves use size and predominant color to indicate denomination, and incorporate the standard currency v-tag and embedded anti-counterfeiting technologies.

Each coin contains a delicate line-work etching of the Imperial Couple (in whose reign the coin was minted; there are usually a dozen variants in circulation at any one time) on the obverse, with their names and titles encircling the portraits in elaborately scrolled cursive text. The value of the coin is given at the base of the portraits in simple figures, and by a series of raised dots in the upper right quadrant.

The reverse of the coin is marked with a number of different designs, depending upon the coin’s denomination, as listed in the table below (primary denominations are tinted); note, of course, that these represent the current mintings and historical coinage may differ. On the milled edge of each coin is inscribed the Imperial motto, “Order, Progress, Liberty”.

Denomination Color Design
= ¼ selenis
= 1/48 lumenis
= 1/1152 esteyn

Brass tinct. An upraised hammer.
= 1/12 lumenis
= 1/288 esteyn

Copper tinct. A single ripe peach.

= 2 selenis
= 1/144 esteyn

Copper tinct. Sword and rifle, crossed.

= 4 selenis
= 1/72 esteyn

Copper tinct. A stylized atom design inside a laboratory flask.

= 6 selenis
= 1/48 esteyn

Copper tinct. An ékaláman (Eliéran wyvern) in flight.
= 12 selenis
= 1/24 esteyn

Silver tinct; gold inlay on the sun. Crescent moon and sun.

= 2 lumenis
= 1/12 esteyn

Silver tinct. A portrait; traditionally that of someone whom the Imperial Couple wish to honor for some act of note. This portrait is frequently changed, often as frequently as four or five times per year, and so double-lumenis of many different issues circulate together.

= 4 lumenis
= 1/6 esteyn

Silver tinct. A harp and quill.

= 6 lumenis
= 1/4 esteyn

Silver tinct. A pattern of interlocking cogs, ringed by lightning.

= 12 lumenis
= ½ esteyn

Silver tinct. The Borromean rings, traditional Imperial symbol of order, progress, and liberty.
= 288 selenis
= 24 lumenis
= 1/6 arien

Gold tinct. The fundamental unit of Imperial currency, the esteyn bears the Imperial Star alone.
= 120 lumenis
= 6 esteyn
White-gold / platinum tinct. The “constellation” formed by the stars of the original Thirteen Colonies along with the eldrae homestars.



Imperial bills, used for denominations of one arien (also minted as coinage) and greater, are constructed of a special plastic silk laminate that remains clean and has a very long use life. Bills are almost impossible to tear, won’t burn, and incorporate a large number of anti-counterfeiting technologies because of their unique method of manufacture. Plastic silk fibers are combined under high temperature and pressure and extruded as a rectangular bundle of great length. The differently-colored fibers form the pattern of the bill, not printed on but actually made a part of the structure of the bill. The bundle is then sliced to paper thickness, and a unique 14-character code and v-tag microtransponder is added for uniqueness. Bills are issued in denominations of six, twelve, twenty-four, seventy-two, 144, 864, 1728, and 20,736 esteyn.

The bills have been standardized at 2½ x 6 inches. They can be bulky in large enough quantities; a thousand bills stand two inches high and weigh one pound. Value is denoted by background tint color, face printing, and tactile impressions. Each bill has a portrait of the Imperial Couple in the left two-thirds of the obverse, the remainder of the space being taken up by the promise of value from the Exchequer and associated signatures, including the Imperial word. The design of the reverse varies, as indicated by the following table:

Denomination Color Design
Es. 6 / Arien

White Gilea Cheraelar, founder of the Invisible Exchequer and major figure in early Imperial banking, stands outside Worth House holding a merchant’s scale.
Es. 12

Blue The skyline of Calmiríë, centered on the Imperial Palace, with cranes on the wing above it.
Es. 24

Green A portrait of Sung Iliastren, the Father of Science, working in his alchemical lab.
Es. 72

Red Stane Vitremarvis, inventor of the Stannic cogitator, working at the console of one of the original “brass brains”.
Es. 144

Purple Calria Adae-ith-Adae and Airin Muetry-ith-Mirari, first sophs to land on the moon Seléne, standing at the base of the ladder of Silverfall Four.
Es. 864

Gold-yellow Symbolic representation of the process of nucleonic fusion that goes on in stars.
Es. 1728

Gold-yellow A portrait of Imogen Andracanth, inventor of the traversable wormhole, with a stargate in the background, through which a starship is currently making transit.
Es. 20,736

Gold-yellow A portrait of the economist Períne Cyprium-ith-Elethandrion, superimposed upon a fully-loaded Tyrnííché-class megafreighter.



Certificates resemble bills of denominations higher than 20,736 esteyn, but are a standard 4 x 8 inches, with extensive anti-counterfeiting technologies embedded in them. They are rarely circulated and are used primarily for bank to bank transfers, along with letters of credit, bearer bonds, and other negotiable instruments.

Trope-a-Day: Fictional Currency

Fictional Currency: First, see Global Currency for the most widespread of these: the Imperial esteyn, the Accord exval, the Rim Free Zone’s ergcred, the universal-if-useless gAu, gAg and gPt, the information-currency finality, and so forth.

Then there are the Empire’s internal currency (for all practical purposes, sets of denominations of the esteyn, but they were independent currencies once): the Cestian bright, the Selenarian imperator, the Veranthyr oakworth, the Cimonië kal, the mechanician-scrip cog, the Melchar pyracie, and so forth.

And the independent currencies of all the various polities of the Worlds and beyond: the Voniensan hourly (which is not, they insist, not a currency), the tennoa reiutil, the codramaju biopoint, the Magen croluyn… and many others as yet undefined.

Trope-a-Day: Global Currency

Global Currency: Played straight, twice, and arguably more often.

The first of them is the Empire’s esteyn, acceptable everywhere in it and existing in the interests of internal free trade.  It’s a quasi-fiat currency, managed by the Imperial Board of Money and Values to avoid either inflationary or deflationary tendencies to provide a reliable store of exchange-value.  It’s acceptable anywhere the Imperial writ runs, in quanta from the micro-esteyn to the mega-esteyn, and is denominated in a truly remarkable range of values as well as its official ones, inasmuch as to simplify the transition, most of the local currencies which formerly existed were redefined as new denominations of the esteyn.

(The management is done on the basis of an energy/cycle index, these days, modified for secular productivity changes due to innovation.  It used to be done on the basis of a rather broader basket of commodities, likewise modified, but the advances in nanofacturing and automation technology have thinned it quite considerably, in consequence.  Also, while technically it’s done by the IBMV, in practice, in the modern era, most of the day-to-day work is done by a massively-distributed AI which extends itself all through everywhere there is an economy and keeps track of those statistics which it needs to know to make things work.)

The second is the Accord exval, an interstellar exchange currency between and supported by the signatories to the Accord on Trade, and managed by the Conclave and the Galactic Trade Association on their behalf – or rather by their tame AI – to be valued at the real-time floating average value of the currencies of each of the members.  (This makes it rather more volatile than the esteyn, both because many members prefer to hide or play silly-bugger games with their actual economic numbers, and because enough of its members are AI-phobic enough that the GTA’s AI is nowhere near as intelligent or self-directing as the Empire’s Fiscal Prime.  Some people evidently find it hard to turn control over to a machine that’s smarter than they are.)  The exval is not, for the most part, a real currency – it’s money of account and exchange currency, used to optimize cross-polity electronic currency transfers and make it easier to track the real values of foreign-held assets – and to let working spacers and tourists know what the actual prices of things are as they spend (most polities that receive any amount of tourism, and just about all the starports/startowns, dual-label goods in local money and Accord exvals; which one gets the round number and which one floats tends to vary by location).

There are a number of other currencies of general acceptability; the venerable gAu, gAg, and gPt can be traded anywhere, although you need so damn much of them given modern mining technology and its effect on the value of the underlying metals, it’s hardly worth bothering anywhere off Hicksworld.  The energy (usually antimatter) backed, fully convertible, ergcred is sometimes seen, especially out towards the Rim Free Zone.  A few of the higher-infotech societies out there occasionally talk up the virtues of the finality – and use it between themselves – backed by irreversible computational operations, but have trouble selling it to people of less infogeekery.

Fantastic Measurement Systems: Some Notes

Copied and pasted from the G+ comment thread on this trope-a-day, as I deem it worth repeating for other interested parties:

Jasper Janssen:

I assume there is lots of vocal arguing about why don’t you simply adopt a straight duodecimal system, get with the program man, it isn’t 5145 any more!

Actually… no, not really.

This all ties back to one of the fundamental psychological differences between Homo sapiens and Eldrae alathis . Namely, that our brains are literally hard-wired to generate error signals when we see other human-shaped things disagreeing with us. We’re programmed right down at the meat level to tell other people that They’re Doing It Wrong, or to suffer mental stress when other people Tell Us That We’re Doing It Wrong.

The eldrae don’t have that innately, and while they have a scientific understanding that some minds can be wired that way, they don’t really grok the urge.

The powers-of-12 system was invented by the Fellowship of Natural Philosophy (the largest and oldest of the scientific branches) because it was useful for the sort of things they do. But it never occurred to them that they ought to go out and tell everyone else that they were doing it wrong. Sure, they published it for anyone who wanted to use it to use, but that’s about as far as it went.

And even if they had , the Edifacient Sodality of Bakers and Pastrywrights (say), would just have come back to them with, “Okay, so, show me how this will lead to better pie?” As far as they’re concerned, they’ve got a perfectly cromulent system of units already, optimized over literally hundreds if not thousands of years for the purpose of helping them turn assorted ingredients into delicious pastry. They’re smart, rational people; they’ll listen to practical arguments for adopting it, but they don’t feel any urge to change just for the sake of it, because they’re Doing It Wrong, or because there’s a One Right Way to do it, and were you to make that argument to them, they’d still be waiting for your point after you were done.

(As a not unrelated psychological quirk, they find the parallel existence of multiple ways of doing things natural in a way that we don’t. Even the most rabid individualist running on human hardware has to silence or otherwise deal with that little nagging inner voice that wants to conform with the group. We define ourselves, as humans, largely by reference to other people.

They… really don’t. The dominant inner voices an eldrae is listening to concern themselves with devotion to ideals – which they call estxijir – and to their brilliant, shining, unattainably perfect Platonic ideal of themselves – and that one’s valxijir. Notions, on the other hand, like conformity or relative status games don’t form part of their psychology, and even social identity per se barely gets a look in. Those are concepts both alien and, for that matter, deeply creepifying.

All of which alien minds are alien foo is background to say that the competitive-standards, This Is The Way Of Progress, All Right-Thinking People silent arguments for, say, metrication bounce right off people who see measurement systems only as tools to be used to help them immanentize their awesome, when relevant and best for the task at hand, and not as signifiers of anything at all.)

So, practical arguments (“Makes better pastry! For Great Excellence!”) work. (And, indeed, there are branches which advocate various systems for various things on those grounds.)

Coordination / specific consistency arguments work – everyone understands why the Spaceflight Initiative declares that everyone contracted onto one of their projects will compute trajectories, etc., in the powers-of-12 system and otherwise use Lorith-Llyn Engineering Units.

And some de facto standards exist – when Llyn Standard Manufacturing, ICC, declares that they’re calibrating all their components in Lorith-Llyn Engineering Units, the majority follows suit because it’s just common sense to be compatible with the 800-pound gorilla in the field.

But absent something like that, no traction is there to be had.

Jasper Janssen:

I did say duodecimal, not decimal — nothing wrong with factors of twelve per se. What bothers me about the outlined system is the spurious factor of 2 you introduce by using a 24 there. That makes calculations needlessly difficult when they have to cross that boundary, which is particularly annoying if you have a (monetary) system that goes from macro to micro with all nice and regular duodecimal factors and that one factor of 2 in there.

And conceptually, it also makes it not a power of twelve system, which itches my brain.

Oh, just the money , right. I thought you were talking about weights and measures systems in general (which, aside from the strict powers-of-12 system used for scientific purposes, includes all manner of irregular factors around the same base units).

Well, that started out that way for much the same reason that many non-decimal currencies here did – when setting up the esteyn way, way, way, way, way back in history, it turned out that 1/144th of it was an inconveniently large penny-equivalent unit. 1/288th, on the other hand, was just right , and in practice, since most people just had to worry about the selenis being 1/24th of a lumenis most of the time (an esteyn being a big chunk’o’money), that’s why the difference is where it is.

(There’s also a factor of 6 further up – 6 esteyn = 1 arien – but an arien is almost purely money-of-account used under certain specialized circumstances, like guineas, so.)

Why didn’t they duodecimalize it later?  Well, three reasons:

(a) The size factor of the penny-equivalent unit still applied. Es. 1/144 was too large. Es 1/1728 was way too small. And just as in the weights-and-measures systems that are focused on non-scientific functions, people want to use units scaled to be optimal for their common usage.

It’s not optimal from the point of view of centralizing standardization, etc., or mathematical purism, but – since the people who run the monetary system are the people who have money-focused estxijir and they think it’s optimal from the point of view of how people actually use their cashy money – fitness for purpose kicks both of those in the face and does it its way;

(b) I’m actually pretty sure the “easy calculation” aspect never came up in their context, simply because their society – for a variety of reasons too lengthy to go into in this comment: genetic, demographic, economic, religious – achieved widespread literacy and numeracy both somewhere around the early Bronze Age – so by the time people might have been mooting the idea of duodecimalization, it simply wouldn’t have occurred to anyone that handling these irregular factors wasn’t already about as don’t-consciously-think-about-it mathematically trivial as it could get;

and (c), it being a free society and all, anyone who found it useful (some accountants, the Guild of Numbers, difference engine Stannic cogitator programmers, etc.) was perfectly at liberty to write currency amounts as a single number of esteyn with a duodecimal point in it if they wanted to. And thus, they did.

And as per (b) above, people generally considered it intuitively obvious that something priced as four-and-ten cost Es. 0.46.

Trope-a-Day: Fantastic Measurement System

Fantastic Measurement System: Well, yes.  Both for money (the esteyn, to match base-12 Imperial mathematics, uses the 288-system: 12 selenis to the lumenis, 24 lumenis to the esteyn, and also goes down so far as to include special units for micropayments and up so far as to include units convenient for major bank transfers – particularly important since there’s not a standardized international clearing mechanism, making correspondent banks, letters of credit and currency transfers matters of some importance);

And for everything else.  The time measurement system has already been mentioned (see Alternative Calendar), but of course, there’s also the Imperial System (sic) of general measurement, notable for basing its core units on the Planck units, and permitting them to be scaled up and down using the equivalent of SI prefixes, or their base-12 equivalents, for scientific purposes, but also including traditional units (after the fashion of the traditional US or Imperial systems) based off the same core units for convenience in non-scientific situations, including a variety of craft- or task-based units which bake sensible basic assumptions, safety margins, etc. right into the measurement system.

If this sounds complicated, it is; their point of view on that amounts to, essentially, “cope”.

Trope-a-Day: Energy Economy

Energy Economy: While the esteyn is not a pure energy currency (it remains, in our terms, a fiat currency using indices to carefully balance the money supply against the productivity of the economy), in the modern era, given the ready availability of nanofacs, energy forms a major part of these indices (the major indices used are the prices of energy, computational cycles, volume, and standardized feedstock mass; the former two usually predominate).

See here for more.

Imperial Currency

So, some thoughts to answer a comment I received a while back on a Trope-a-Day:

Hmm, so the Libertarian Spess Elves have a fiat currency. That’s interesting to learn and I’m curious to find out some more about how that came about down the line.

Well, first, it’s not like commodity currencies didn’t exist – the Imperial Charter is very specific in that while it requires the Empire to provide a currency, it doesn’t prevent anyone else who wants to from doing the same thing – including the classic precious metal currencies, the gAugAg, andgPt (grain gold, grain silver, grain platinum). But… well, look, as of 2009, 165,000 tonnes of gold had been mined in the whole of human history. Their numbers were similar in the late pre-space era.

So when asteroid miners started going out and rendering down space rocks and dumping gold, silver, and platinum-group metals onto the market in kiloton lots, even after their overheads – which were substantial – the effect on the price of precious metals was… salutary. On the downside.

And when Atalant Materials, ICC, invented the automated smeltership and upped the ante to megaton lots, the second crash pretty much put an end to the preciousness of precious metals. Gold became worth about as much as iron used to, and since it’s still pretty and unreactive, is used for an astonishing range of relatively cheap applications, like casings and cloth, which is why the Empire looks so… shiny. (As for iron, it’s so much of a glut on the market that it’s essentially just-haul-the-damn-stuff-away free. There are gigatonnes of it floating around in far orbit stockpiles as a byproduct of extracting more interesting metals.)

The gAu, gAg, and gPt are still around, but worth practically nothing in real money; and those people who didn’t divest them quickly enough when the space-mining revolution came around learned a really harsh lesson in not keeping up with the markets. The effects, incidentally, of applying this de facto hyperinflation across the entire economy, had they been using the gAu as the sole currency, are left as an exercise for the appalled reader.

Now, of course, this isn’t one of the incidents that led up to them using a fiat currency, it’s just one of the most graphic examples why they should. But the actual reasons were pretty similar. The years between the overthrow of the korásan in the Old Empires region and the founding of the Empire were not, shall we say, known for their political and commercial stability, and commodity prices were correspondingly bouncy; and Alphas I knew perfectly well that by founding the Empire, and then by its remorseless dedication to progress, dammit, progress above most, he wasn’t planning to invite stability in to stay all that quickly.

So, he went looking at the functions of currency and what makes it work, and then set out to create an artificial currency that fulfilled the necessary criteria to work as a medium of exchange and store of value, and in particular, what a commodity couldn’t give people: namely, a constant value/purchasing power.

What it says on each esteyn coin, bill, and certificate is “By Our Imperial Word, One Esteyn” (or whatever the denomination happens to be). Most people leave it there, but were you to go to the Exchequer and ask, “Ah, what word exactly?”, what they would tell you is that the guarantee is that what Yesterday’s Esteyn would buy, Today’s Esteyn will buy, and what Today’s Esteyn bought, Tomorrow’s Esteyn will also buy; that is, that it’s a reliable store of value that doesn’t have an accidental or deliberate inflationary or deflationary trend to it.

The reality is, of course, a little more complicated. In theory, the way this works is that the Exchequer, or to be more specific, the Imperial Board of Money and Values, controls the money supply, and what they do is carefully adjust the money supply to match what the currency’s really backed by, which is to say, the productive capacity of the Imperial economy (or, rather, the esteyn-denominated economy, but that’s very close in practical terms). When production expands, prices of their carefully selected broad basket of commodities fall, and they mint enough money to keep the purchasing power of the esteyn constant, distributing this seigniorage – in modern times, where this is practicable – evenly through the entire economy in proportion to how much money various holders already have, in order to avoid distorting the market by having it all appear in one place. Should production contract, prices rise, and they requisition an appropriate amount of the government’s revenue and make it disappear.

In practice, of course, this is substantially more difficult because of technological innovation, new resource discoveries, etc., etc., ad nauseam, so it requires considerable juggling of the basket to ensure that such adjustments as they make to the money supply reflect secular productivity changes across the entire economy, and not one commodity, say, going way off the average because of, well, resource discoveries like the above space-mining example, or technological innovation in manufacturing (which should be reflected in price changes, because it’s not merely a consequence of an artificial supply constraint), or some such. And ultimately, of course, the basket ending up as a primarily energy/cycle index when nanofacturing, automation, and such, made the manufacturing cost of pretty much all material goods – “post-scarcity commodity goods” – fall right off the bottom of the chart.

But over the millennia, they’ve got pretty good at it.

Now, you may well ask, why isn’t this abused in much the same way that fiat currencies generally are in our timeline?

Well, firstly, there’s much less institutional power there. There’s no actual central bank, for one thing. The IBMV can create and destroy currency to adjust the money supply, and another part of the Exchequer does operate an interbank clearing system, but they don’t operate as a lender of last resort (there is no lender of last resort), no-one sets any sort of interest rates except for individual lenders at their own discretion, and so on and so forth.

Secondly, their governmental system is distinctly minarchical and largely immune to political pressures, and much more importantly, much more harshly designed to weed out idiots than any system on Earth has managed to be. Plus, given the local lifespans, people are used to thinking in time horizons of centuries or longer, which makes quick-fix interventions a lot less attractive.

And lastly, when Alphas I set the IBMV up, he deliberately designed it as a self-perpetuating oligarchy of – making use of the obsessive tendencies of his race – the kind of people who genuinely love money. Not making money, you understand, nor spending money, nor yet having money… but money. The principle that money stands for. And as such, universally despise the notion of using monetary policy to screw around with the economy, abhor anything that might devalue the instantiation of the principle they believe really hard in, and if ordered to do anything that might go against the Proper Way of Things, monetarily speaking, by anyone from the Senate through the Imperial Couple to the Golden God Itself, would order the Exchequer Guard to take up positions around Worth House and tell them to “come and bloody get it”.

And no-one’s dumb enough to even provoke that offer, much less take it up.