Chapter 291: Retreat
Chapter 281: Retreat
Franz has been very busy lately, the economic crisis is coming, he has to cash out most of the industries in his hands, and all the companies that can go public and make money have to go up and walk up.
Stocks, bonds within the investment, but also to empty all. There is not enough money, how can the bottom?
Where huge sums of money are involved, Franz has personally asked. It is their own money, completely not ask all to hand over to the staff to take care of, who can rest assured ah?
Especially at the critical moment before the outbreak of the economic crisis, any one decision error will bring astronomical losses.
Not only personal assets to deal with, the Habsburg family industry also need to deal with, so many industries are intertwined, make Franz are a little numb.
This is also regarded as a happy trouble, in the dominant Habsburg dynasty in these years, the family industry is also in the dramatic expansion, in many areas have investment.
In normal times this is a good thing, meet the economic crisis is not necessarily, once the decision-making mistakes, the results of these years of hard work, will go up in smoke.
Butterfly effect is powerful, history of this economic crisis is the second half of 1857 from the United States began, now added a rapid industrialization of Austria, who knows what the result will be?
Some time ago the government of Vienna, constantly starting municipal engineering projects to attract capitalists to invest, in essence, this is also a means to delay the outbreak of the economic crisis.
These infrastructure projects started, naturally, to consume part of the industrial capacity, easing the crisis of overcapacity.
Taking advantage of this opportunity, the Vienna government also struck out many industries with meager profits. To put it in a darker light, Franz was also buying time for his own retreat, except that it was also beneficial to the country.
This retreat must also be carried out slowly, looking for a large enough number of receivers, otherwise all of a sudden from the market to pull so much money to leave, will not immediately collapse ah?
Uncertain of when the economic crisis would break out, Franz began to slowly liquidate the industries in his hands from the beginning of 1856, and continued to do so until now.
John Steva reported, “Your Majesty, the last batch of railroad stocks have all been thrown out, for a total cash-out of one million eight hundred thousand Shendian; five cement factories were sold this month, for a total cash-out of seven hundred and eighty thousand Shendian ……
It is expected that within the next two months, we will have emptied our hands of all the industries we were preparing to sell off, and will be able to raise approximately 66.8 million God’s rupees.”
Franz nodded, he was still satisfied with John Steva’s work, since the beginning of 1856, on average, every month, he had to cash in four or five million shillings from the market.
It was to John Steva’s credit that no market turmoil had been caused. About one-tenth of this money was Franz’s personal property, the rest being the family estate.
Enough to see, this era of the European royal family is still very rich, hundreds of years of accumulation is not a joke.
And these funds are only a part of the royal family assets, more or real estate. Including Vienna is a part of the royal family directly under the collar, how can the Habsburg family poor?
Before Franz took power, the Habsburg family mainly rely on land and real estate income to live, liquidity is naturally not much.
Since the Vienna government to implement the land redemption policy, as the royal family naturally want to take the lead, Franz breath released 700,000 hectares of land in remote areas, in exchange for a large amount of cash.
Most of this money has been invested in real estate and manufacturing, and the current part of the cash is the manufacturing industry, which has become a non-performing asset in the environment of overcapacity.
In contrast, real estate is much more stable. Building a house on your own land saves you all the cost of acquiring land. Big cities like Vienna are still rent-only.
There is no property tax anyway, and there is no pressure to hoard real estate. When the price reaches its limit and a taker is found, it’s almost time for the property tax to come out.
It doesn’t seem to matter much, taxes on direct royal domains belong to the royal family, how else would Franz be able to afford a private army?
Including Vienna’s city defense forces, which all belong to the royal private army first, and the Austrian army second. Otherwise Franz could not have taken the military power so easily in the first place without causing a backlash.
Reform is reform, but Franz will not touch the aspects that are favorable to his own rule. If he gave all these rights to the government, who knows if the bureaucrats below him would one day overthrow him?
No matter how powerful a person was, he couldn’t possibly outfight an entire group of bureaucrats, and the best way to do that was to limit their rights right from the start.
“Shrink the silver root from now on, conduct strict evaluations of loan clients, and no longer accept stocks and bonds as collateral.”
Franz didn’t forget about his Royal Bank, which was already one of the biggest banks in Austria, once the economic crisis broke out there was no telling how many bad debts were going to appear.
He raised funds to bottom out, not to fill the holes for the Royal Bank. Now did not reduce a loan, it reduces the risk of one point.
John Steva explained, ”Your Majesty, doing so could easily cause market turmoil, and there is the possibility of a chain reaction.
Currently, our loan vetting standards have always been the strictest amongst our peers, and the chances of having bad debts won’t be too high.
Since two years ago, we have focused on developing the colony loan business, lending to that lucky bunch. As of now, the Royal Bank has issued eight million Shendian loans one after another.
Most of these loan businesses, most of the customers are repaying with gold, and together with the gold acquired from the colonies, the Royal Bank’s gold reserves are currently up to fifty-eight tons, which is enough to deal with any crisis.”
Listening to John Steva’s explanation, Franz suddenly understood why the consortiums did not contract their silver roots before the economic crisis to minimize their losses.
These losses were necessary, and if they contracted their silver roots in advance, they weren’t telling everyone that a crisis was about to break out – run.
The world is never short of smart people, and once the news is leaked in advance, it’s not so easy to retreat.
Crossing novels, the protagonist in the stock market crash before the early warning, the beautiful name is to reduce the loss of the people. Franz laughed when he thought about it, who is going to take over when they all run away?
No one to take over, then it is going to fall to the bottom, and eventually the evaporated wealth will only be more, not less.
In order to confuse the public, almost every day there are experts in the stock market crash predictions, listen to more people will be numb, true or false, who can distinguish?
Franz thought for a moment and said, “Since it’s ready, let’s follow your plan. Ship the gold from the colonies back home as soon as possible, once the economic crisis breaks out, the world is going to be unpeaceful again.”
“Yes, Your Majesty!” John Steva replied
(End of chapter)