Foreign Direct Investments
That evening, Will and Elizabeth attended Emperor Jacques-Louis' welcome ball.
Will and Elizabeth were seated at the same table as the emperor, King Roland, Queen, Rosalind, Queen Mother Ashley Marie, Duke Francis, and Duchess Charlotte.
The table conversation was mostly filled with small talk until the emperor asked Will a question.
"Earl, I heard you were a Grandmaster Spellsword Knight, is this true?" Emperor Jacques-Louis inquired
"Indeed, it's true," Will replied.
"How formidable you must be," Emperor Jacques-Louis congratulated him.
"Our kingdom has four grandmasters, including Earl vont Ballard, and one sage. We are quite fortunate to have so many," King Roland said proudly.
"You are fortunate indeed to have sage. I've been to kingdoms without a single grandmaster. Where is your sage, I would like to meet him," said Emperor Jacques-Louis who was impressed.
King Roland looked toward, Will to answer.
"Your imperial majesty, I regret to inform you my master is not here," answered Will
"Your master! You mean to tell me the sage is your master. How scary to have a sage and grandmaster so united. Surely, your majesty must give them great deference!" the emperor said knowingly.
"Naturally, every kingdom must revere its elites," the king acknowledged.
"Sages and grandmasters are what we need to win this war! The more power we have the better our chances of winning," Emperor Jacques-Louis said excitedly.
"Marquis vont Smith, assures me our army shall be ready within a month," King Roland said proudly.
"Wonderful news. When I met with Emperor Kaiser, he had several positive things to say about your kingdom, and now I know why," the emperor said half true.
Everyone at the table knew Emperor Kaiser would have gone to war against Fermion if his expansionist policy hadn't ceased.
"I'm happy to hear, Emperor Kaiser thinks so highly of us," said King Roland.
Turning to face Will, Emperor Jacques-Louis replied, "Emperor Kaiser said something else to me. He said I should seek your help to rebuild my empire after the war. Moreover, Duke von Mueller told me the same thing."
Will's green eyes shimmered a heavenly gold just for a second.
"I'd be interested to hear more," Will said, his eyes filled with avarice.
…
Five days later, Emperor Jacques-Louis sat in an armchair in Will's office.
"Have you enjoyed your stay in Gadreel?" Will asked.
"I have, but why did you put off discussion until I toured your city?" asked Emperor Jacques-Louis.
"Because my city represents me, who I am, my beliefs, and what I value. If we win this war, and I do mean if. You'll rebuild your empire based on your beliefs and values," Will explained.
"Ah, I see your point," the emperor said sipping on a glass of old reserved whisky.
"Now tell me your vision," Will asked getting out his pen and notepad.
"I've seen several cities on my travels, non-similar, each varied in their cultural way. Rhaziesian culture is like its geography, a regional patchwork. But overall, I would say, my culture was formal and aesthetic. We value liberty and the God Pontus," Emperor Jacques-Louis finished.
"It sounds like a wonderful culture," Will agreed after putting down his pen.
"It was, I miss my homeland," Emperor Jacques-Louis said thoughtfully.
"I'm going to assume you are not familiar with the process you're asking to undertake. Let me be honest, it shall be difficult and at times, you may hate or even despise me.
To rebuild your empire, you'll need three types of funds: loans, bonds, and investments.
I know you've already spoken to the King Roland about loans and bonds, as he's used them quite a few times.
By now, I'm sure you have a rudimentary to intermediate understanding of how Fermion has used both successfully, and why they are attractive to municipalities and sovereignties," Will paused.
"Yes, King Roland gave me very detailed explanations on both," said Emperor Jacques-Louis, but he failed to mention King Roland also warned him about Will.
No sovereign or sovereignty wants to be too indebted to one person, especially when a grandmaster.
"Good, then I'll focus on investments for the first part. Investors often seek profits from a long-term stake in foreign operations.
Foreign investors can have myriad motivations for seeking to earn profits in another country. But they have fundamentally two core choices when deciding how to deploy their capital.
They can make a portfolio investment, buying stocks or bonds, say, often with the idea of making a short-term speculative financial gain without becoming actively engaged in the day-to-day running of the enterprise in which they invest.
Or they can choose the long-haul, hands-on approach—investing in a business to gain control or exert significant influence over management.
As a new sovereignty, the most important component is the lasting impact," Will explained.
"And what do you call this strategy?" asked Emperor Jacques-Louis.
"Foreign Direct Investment. You need investors to sell you loans, buy bonds, and invest in your businesses," Will emphasized.
"I understand. What don't I understand is why everyone is waiting to hear our contract agreement?" questioned Emperor Jacques-Louis.
"There are several factors which influence a person's decision to engage in foreign direct investment, including risk analysis.
There's a lot of uncertainty in the market, and I for one am also undecided whether to invest in your future empire. There's too much long-term risk to know whether it's a smart investment to back you or not," Will replied honestly.
"How can I convince you?" Emperor Jacques-Louis asked confidently.
"Let's imagine 5 years, 10 years, or 20 years from now that we've defeated the demons. The Third Great Schism ends in mankind's victory.
Have you thought about the staggering cost it shall take to rebuild your empire? You don't know if your citizens shall return?
Have you thought about the tax rate, including tariffs? Shall you enact trade barriers? What industries besides agriculture, shall you develop? And most importantly how do you plan to pay your investors back?" Will finished.
"I don't have the answers. You're the first person to help me," Emperor Jacques-Louis began crying.
All the pressure he had built up was finally released. His tearing eyes overflowed. His helplessness finally reached his limit and streams of tears rolled down his face and pooled on Will's desk.
Will waited awhile giving the young emperor time to gather himself.
"Let me ask you, do you know where your advisers are? Will asked.
The emperor quickly explained what happened to his empire after the World Economic Forum.
"Yes, that is quite the story. A divided kingdom cannot stand against any foreign threat, much less an invasion of demons," Will agreed.
"So, you have no one except your manservant and crew. Neither of which have been paid in months? I'll see to it my clerk Elliot pays your sailors their backpay," Will promised.
"You don't have to do that," Emperor Jacques-Louis said waving off the favor.
"Consider it a grant. Besides I'll make millions more of our deal," Will said nonchalantly.
"You've decided to help me then?" the young emperor asked excitedly.
"I have, but not without some major stipulation. As I said, you represent a major liability. As long as we agree on those stipulations, the rest is a matter of details," Will said.
On Earth, Will invested in foreign companies with the idea of producing components that become part of a bigger product. For example, an automaker may invest in a plant to build transmissions that are shipped to a final assembly plant in another country.
This direct investment accounted for much of Will's foreign investment in developing countries. Now he would be investing in a fallen empire and an inexperienced monarch.
When he was on Earth, he was friends with Joseph Stiglitz, who had much more experience advising developing countries on economic policy.
Although, they disagreed on economic philosophy, globalization, and most other things they were cordial.
Even though they disagreed, Joseph was still a Nobel prize winner, a prolific writer, and served as the Chief Economist of the World Bank. And Will held the man in great esteem.
Even now, Will wished he could consult the man about rebuilding the Rhaziesian Empire.
"Well, if we're going to work together, please call me Jacques," the emperor said stretching out his hand for Will to shake.
"Well Jacques, my stipulations deal with austerity measures. If I invest in you, I need to know where every coin goes. If you accept my agreements, know there are going to be expenses I will decline.
You may think this cruel, but my shareholders are going to want to see profits from this deal and I cannot afford for you to make bad spending decisions.
My other stipulations have to do with your advisers. Understand, I cannot just give money without making sure you have well-reasoned advisers around you," Will explained.
"I can abide by those stipulations," Jacques replied.
"That's my worry. I'm not sure you understand how drastic my stipulations are. Instead of accepting right away, you should take time and consider the pros and cons carefully.
Because once the contracts are signed, I'll fundamentally own the Rhaziesian Empire until you can pay me back. And failure to pay your loan or devalue my investment, gives me the authority to repossess your empire until you pay what is owed," explained Will seriously.
"Is there no negotiation or leeway?" Jacques asked.
"Only after your empire's been established for a year. Based on the contract, each year your empire is established the more stipulations drop off, until year 10 when the last stipulation expires," Will described the contract intricacies.
"You're right I'll need to think on his," Jacques said greeting you to leave. He needed to weigh his decision. The idea this contract would potentially give Will, a foreigner, power and political influence over his fledging empire.
"Your imperial majesty," please let me know what you decide.
…
After the emperor left, Will sat in his office looking over the encyclopedic report on the Rhaziesian Empire.
In the entire report, one sentence caught his eye. He had re-read this sentence nearly 20 times.
The sentence read, "the Rhaziesian Empire desert is barren, but what hides within are beautiful oasis and black liquid spouts."
Will was almost sure, there was a massive oil reserve in the Rhaziesian desert.
That was the reason his eyes lit up with aversive when Jacques asked for his help. Will had already made plans to seize the oil field if mankind came out victorious.
The only advantages associated with investing in a foreign country—were the abundant or unique natural resources, low labor costs, and the developing of a new market to trade goods.