Magic Effect

Councilor Udina sighed. Less than two months, and there was already problems with the species of Ungula, problems that aparrently called for Ambassador Sparkle to call for a Council representative to help intervene. Approaching the embassy door, he knocked and waited.

"Come in!" came Twilight's reply, casually as though greeting a neighbor who swung by, not the tone of a politician trying to work out a crisis.

Udina walked in, and was struck by some serious disconnect. Ambassador Sparkle was sitting naked, again, at her oak desk, drinking from a silver, jewel encrusted chalice while going over stacks of parchment with a quill and ink. She was in the process of transcribing the data from the papers in front of her into her computer's holographic interface. It looked like a cross between a fantasy movie and a typical business day. It would probably make a good sitcom. "Ambassador Sparkle, you said there was a serious issue?"

"Yes, unfortunately." Twilight said, frowning. "It seems to be a serious economic trade issue, and I just can't figure out how it happened. But the bottom line is, all of our trade attempts have fallen flat on their face in one direction, namely us trading to you, and taken off like a rocket the other way. And from what I can tell, it has to do with economic pricing."

"Oh?" Udina said, taking a chair. "That is unusual. Usually the problem goes the other way, with the new civilization producing goods cheaper by comparison and almost ruining itself economically buying into new markets."

"We're almost getting economically ruined too." Twilight said, shaking her head. "Money going out, not in. And to make matters worse, space travel is new to us, so shipping materials via spaceship is a massive undertaking and investment. And a large number of shipped goods are perishables, a good number of which have already expired. A lot of countries involved in this have had to issues bailouts and reimbursement to a lot of businesses already. In fact, somehow, the Diamond Dogs are the only group not only turning a profit, but they are making a fortune somehow. They just aren't taking it back to Ungula, but investing it off world."

Udina nodded, this was a problem. Trade deficiency like this wouldn't just be a long term problem on the galactic scale. It seemed to be so on the political scale of Ungula, making the rather less than impressive nation of the Diamond Dogs suddenly the top player in galactic politics amount that little group. Equestria was facing a political and financial crisis for having come out here. Not very good PR for their ruling caste. "So, any idea how they are doing it?"

Twilight shook her head, looking rather disappointed. "Nothing. I've been going over their trade cargo manifests, and unless they are smuggling something, I just don't see how they are making such a killing. But then it becomes I have no idea what they could be smuggling from home that the galactic community would be interested in and that they could be getting consistently past our customs agents and yours. Even if C-Sec didn't know the significance of something, unlisted cargo is unlisted cargo, you know?"

Udina nodded, frowning. "Hmm, well the usual things smuggled would be drugs, art, historical artifacts, and undeclared regular goods."

Twilight sighed. "Ungula doesn't exactly have a thriving drug trade, too many biologies to cater to and no government tolerance. There is no ban on selling art, so if anyone wanted in on the 'exotic new art' it is available through legal means. Unless its a historically significant piece of art, but none of those have gone missing...that I have heard of anyway." Massaging her forehead, she continued "Admittedly what little artwork some pony though to add to their cargo list was basically all they managed to sell, showing there is a market, but he had difficulty selling it at a fair price, having to make only a small profit of the pieces sold. It didn't make up for his food stock going unsold and spoiling. Poor fellow nearly lost his farm just getting out here."

"He nearly lost his corporation?" Udina asked, stunned. If coming to the Citadel was that much of an economic disaster, it was very possible Ungula would pull out economically entirely.

"No, his farm." Twilight responded, looking confused. "You know, farming? Been in his family for generations?"

"So...this was an individual small farm, and not an agricultural conglomerate?" Udina asked, not understanding why the princess was getting so concerned about a single farmer.

"Agricultural...hold on a second." Twilight turned to her computer, accessing the search function and calling something up. Reading through rapidly, her mouth formed a small 'oh' of understanding. "We don't have those on our world. Agriculture is still a family run business, not a corporation."

Now Udina understood why she was so nervous about one farmer. There wasn't some corporate entity that didn't care if an individual farm did well as long as on the whole they profited, there were instead thousands of farms each looking at how the royalty treated them. If a farm collapsed because of the fact that they listened to the idea of attempting to trade with the Citidel and the royal family did nothing to help said farmer, you suddenly had a lot of angry farmers on your hands...or hooves as the case may be. In addition, bailing out a small scale business and getting to the root of the problem now was a very sound PR and long term economic move. Twilight was more skilled at politics than Udina had thought. "Alright then, what do you think might be the problem?"

Slumping back, Twilight let out a groan of frustration. "I am not certain but I have three theories. The first is tht our food and medicines are unappealing to the Citadel races, and as such we need to focus on other areas. But that doesn't explain the low profit art sales. Option number two is speciesism, in which case time and familiarity will correct the problem, but then how are the Diamond Dogs doing so well? My final thought is that we made some mistake in the exchange rate between the bit and the credit, but that makes no sense either. Before we ever joined up here, those Volus worked with us for a whole week to get the exchange rate and economic market comparisons set up."

"A week?" Udina asked. "Really? That sort of work takes years. You aren't still working with the Volus on this?"

Twilight rolled her eyes. "They said there was no need. Our coins work on material value base. Essentially, a bit is worth just as much as the gold it is made of. Rediculously easy to convert. Fifty credits to the bit."

"Hmmm, so they say. But it could still be off. Let's try an exercise. I point out something and you tell me how much it costs in bits, see if we can't hit a snag." Udina sugested. "I doubt they managed to get it down that fast."

"Okay sure. Even if it doesn't work it sounds like a fun little distraction from the crisis." Twilight said, sounding entirely too happy for the situation.

Udina sighed. He just had to remember the ambassador was insane. "Alright then, that goblet you are drinking about of?"

"A hundred and fifty bits." Twilight said, taking a sip. "Before you ask, yes the gems are natural, and it's genuine silver."

Udina nodded. "That does answer that." Considering the size of the natural gems, the cup was easily worth over five thousand credits, probably closer to seven thousand, though that might just be market difference between gem types...a possible exploit the diamond dogs might be useing. "How about your crown, without factoring in cultural or historical significance?"

Looking up at her shelf where the headpiece rested, Twilight blinked. "Huh, never though to have it appraised after my friend made it for me. Um, fifty to seventy bits, somewhere in there maybe? Throw in culture and history, and it's probably the fifth most valuable crown in Equestria, and probably on the top twenty list for the whole planet."

"Alright, let's try something cheaper. Hmm, all that parchment on your desk," Udina said, "how much would that cost blank, fresh, and new?"

"About ten bits for the whole ream." Twilight responded casually.

Udina's jaw dropped. "Ten bi-that quill you're useing, that ink, how much?"

Twilight seemed confused at where this was going. "Um, quills are usually sold two for one, and a full bottle of ink costs about three bits."

Udina could feel his stomache sink as he considered his next question. Considering a farmer had such trouble, "How much for an apple?"

"A bit an apple, that's been the standard for a few years." Twilight said. "Unfortunatly, with the current economic issues we may be seeing a slight price hike, as much as three bits for two apples, or even as much as five for three...Councilor are you alright? You don't look so well."

*****************

"I can't believe such a serious error occurred!" Tevos shouted in the closed session. "How could something so obvious be missed so easily?"

"The volus were being lazy." Sparatus responded. "They learned that the bit was a material value coinage, and used the galactic standard rate for it. They will be called to task for this."

"I would hope so." Vallen remarked. "Not taking into account the need to figure out the economic value of gold on the local world? Sloppy."

"Indeed." Udina said. "From what me and the ambassador were able to figure out, a large number of "valuable minerals" are junk on her world. They give twenty carat gems as tips for bellhops, and it seems their carat is several times larger than ours on top of that. The diamond dogs were able to figure this out, being very well versed in mineral trade. They were bulk shipping "low value material" off world and then selling it for what was, economically speaking, a massively inflated rate that was still undercutting the competition."

Tevos sighed. "Which they then used to start serious investments into various mining operations throughout Citadel space. Especially the ones that are providing bulk materials that would sell better for them back in Equestria than out here."

"They're trading beads for gold both ways." Udina summed up. Seeing the other Councilor's blank looks, he waved it off. "Human expression. Basically, exploiting ignorance for lopsided trade."

"Still," Tevos said, "who would have thought we'd meet a species that valued apples more than gold?"

Udina smirked and dryly noted "Twilight seems just as confused the other way. As she put it, you can eat an apple and use the seeds to grow more trees for either food or lumber. Gold just looks pretty."

"Valuing utility primarily." Sparatus said, giving a turian smile. "Maybe the ponies aren't so bad after all."

"Maybe," Udina muttered, "but this is going to be a nightmare of an economic integration."

"I'm sure the volus can handle it." Tevos said. "After all, they can't afford to screw up again."

"Indeed," Sparatus said, sounding quite grim and angry, "they can not."