Black Label Union(5)
Ricardo suddenly had a question.
Rockefeller was also a money-hungry person.
Was he not interested in investing in trading ships?
"It seems like you could hit the jackpot if you do it right. Will you not invest in trading ships at all?"
Rockefeller faintly smiled and answered his question.
"I won't deny that trading ship investments can be a great way to make money here. The return on investment is quite high. However, trading ship investments are a sort of gamble. You could become wealthy in an instant, but on the other hand, you could also lose everything in a moment."
A ship could be wrecked in the middle of its journey, or the captain could run away.
Unlucky encounters with pirates were also possible.
Various reasons could lead to a trading ship not returning with its cargo, which would result in a failed investment.
"I, for one, prefer a surefire way to make money over such ambiguous gambling."
Rockefeller emphasized his point by raising his index finger.
"I would be willing to grow a profit that has even a 1% confirmed return. However, I do not favor risky ventures like trading ship investments."
Rockefeller mentioned his previous statement to avoid any misunderstandings.
"Well, it might be worth a try if I have a good intuition. But for some reason, my intuition is quiet here."
He continued with a smile.
Seeing his smile, Ricardo asked with slightly narrowed eyes.
"You don't seem to like gambling as much as I thought. I thought you would enjoy it since you supported the Second Prince."
"The Second Prince's case is an exception. It's also a gamble, but I had a good feeling about it."
"A good feeling..."
It was a convenient excuse.
The pretext of intuition.
Rockefeller spoke to Ricardo, who seemed displeased.
"Personally, I don't really favor gambling. Of course, there may be times when gambling is necessary. If it's an unavoidable gamble, I'll give it a try, but if I can avoid it, why would I gamble?"
"I agree with that."
"I prefer certainty over gambling. I would rather lend money to those who come to borrow from us, like earlier, and earn a stable interest income."
Rockefeller truly wanted to pursue a smaller but more certain profit.
"If the loan business goes well, you can earn a substantial income. It's a much more stable business than trading ship investments. Even if we set the loan interest rate lower than the current 6%, people desperate for money will swarm in like bees. Then we can enjoy the profits."
Ricardo expressed doubt about the profit difference between loan interest and trading ship investments.
"Still... wouldn't the profit from trading ship gambling be much greater than the profit from the interest rate difference?"
As he spoke, Ricardo thought of something.
If trading ship investments were worth considering, and their financial strength was not bad, wouldn't it be possible to diversify investments to pursue high profits, as Rockefeller had mentioned?
"Didn't you say earlier that trading ship investments might be okay if you can reduce risk through diversification?"
"That's right. That's an assumption, and it seems likely."
"Then wouldn't it be worth trying?"
However, Rockefeller shook his head.
"There may be some certainty, but it's not absolute. I only thought about it, but I can't be sure it will really happen. Who can guarantee that?"
"That's true. We can't be sure. The ships we invest in could all return, or..."
In the off chance.
If such a thing existed, what he said could indeed be possible.
"Or they might not return at all."
"That's right. If you're lucky, all the ships you invest in could return. But they might not return at all. It depends entirely on luck."
"You really don't like gambling."
At that, Rockefeller retorted.
"Is there a need to like it? We can just focus on making surefire profits."
Rockefeller explained further for a simple understanding.
"Let's assume an easy case. We set the loan interest rate at 5%, and the deposit interest rate at 1%. Then a fixed profit of 4% is generated. To put it more simply, if someone deposits 100 dalants and another person borrows those 100 dalants, we will earn a fixed profit of 4 dalants every month."
"4 dalants... that's smaller than I thought."
At Ricardo's remark, Rockefeller laughed deeply.
"That's why we need to scale up. We won't just be doing business with 100 dalants, right? If we increase the scale to 10,000 dalants, 4% of that, or 400 dalants, will be confirmed as our monthly income."
Ricardo chose to listen quietly to Rockefeller's words.
"If we further increase the scale and the amount of deposits and loans reaches 1 million dalants, we will earn a whopping 40,000 dalants per month just by putting up a store sign."
"40,000 dalants... that's definitely a lot."
"That's right. That's why we need to scale up. The larger the scale, the better for us."
Rockefeller began to speak again to give another example.
"Now, let's consider trading ship investments. I don't know much about it, but I know that the investment cost for one trading ship is about a few thousand dalants. This varies depending on the size of the ship, so let's assume an average of 2,000 dalants, with an investment period of 1 year. And let's simply calculate the huge profits based on a 400% return excluding construction costs."
Rockefeller, who had been speaking at length, took a short breath before continuing.
"In this case, if we assume an investment of 2,000 dalants, the expected monthly profit is around 666 dalants. If you fully consider the risk of the ship not returning, the expected profit will be much lower. However, I won't deny that it's still a high-profit business. Honestly, there's nothing else like it."
"If only it succeeds."
"Yes, that's right. If only it succeeds. But there's a stark difference between such a business and the loan business I'm running. Do you know what that is?"
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