The Duchy's Financial Predicament

"Alright, old man, stop spinning me. It's making me dizzy. Let's settle the bill first to see if it's enough."

Count Lagos glared at the disrespectful Pelei and sat back down at his desk.

Pelei immediately took out the paper and pen that were placed aside and started calculating.

"Look, this time we need military funds to rebuild the 1st, 3rd and 4th Legions. The cost of rebuilding one legion plus half a year's maintenance costs would be gold. This is after the Cavalry units have been reduced. The total cost for the three legions is gold."

As a result, the 5th and Sixth Legion were severely damaged again. Even if we calculate the losses at half, they would still have to pay gold!

That means just replenishing the troops requires gold.

Count Lagos shook his head and added.

"It's not enough. The Sixth Legion lost a large amount of equipment and supplies, as well as a Cavalry battalion. Replenishing the troops and rebuilding the Cavalry will require gold. In addition, the Fifth Legion suffered heavy losses, which will also require gold."

Pelei rolled his eyes after hearing this. "Okay, then add more. That way, we can replenish the troops with just one type of gold."

I remember that this time, the special military expenses of gold were collected from the independent nobles, plus this year's annuity, which together brought the total amount of gold that the duchy could collect in one go.

After deducting the annuities paid to the Court Noble, there was probably gold left over – that is, gold.

"Not that much. Something just happened in Cornwall County in the south, so they probably can't afford it either. Mora has already waived the special military budget for Cornwall County."

The special military budget is currently only in gold, and the annuity is also not that much. The northern nobles and Count Lloyd combined have reduced the annuity by gold. We only have gold in total this year.

The 1st, 3rd, and 4th Legions have been rebuilt and all the money has been spent. The military expenses for the Fifth Legion have been allocated, and there is still gold left in the national treasury.

"Yes, Mora also diverted nearly all the gold to renovate the palace and make purchases, leaving only gold."

Viscount Pele scratched his head. "So, the Court Noble's annuities haven't been paid yet, and the Sixth Legion's replenishment funds haven't been allocated either."

With this year's orchard harvest, we're barely breaking even!

Count Lagos said with a wry smile, "How could we possibly break even? There are still expenses for deployment and military supplies. Last year, Mora also borrowed money from several Great Merchant Guilds for working capital, and that money has to be repaid this year."

Pelei was stunned after hearing this. "That can't be right, what about the revenue from the directly controlled territories? Surely there should be some money from that. I remember there's a gold coin a year, plus the merchant guild's dividends."

"The previous loan collateral was the revenue from the directly controlled territory. This money has been directly taken away by several Great Merchant Guilds to repay the debt."

"How much money do you owe exactly? Isn't the gold enough?"

"A total of gold was borrowed, mainly for rewards and compensation to nobles in the west and south. It was borrowed right after the Civil War, with an agreement to repay it within two years. Last year's returns were not good, so we planned to repay it this year. Who would have thought that Civil War would suddenly break out?"

As for the chamber of commerce's dividends, they were also directly taken by the chamber, and this debt still needs to be repaid.

Pelei gritted his teeth. "Old man, you and Mora are really ruthless, how dare you borrow so much?"

"I didn't want this either. We both thought the orchard would be profitable this year, but it's gotten worse and worse."

"That can't be right. A lot of fines were collected when the Central nobles were punished. There must have been some left over."

"That money has already been spent. Part of it was allocated to the Ducal House, and part of it was spent by Mora. You also received a share of the money allocated to the Ducal House, which was distributed according to your rank."

Viscount Pele remembered that he had indeed received a reward of 50 gold last year, which made him quite happy at the time. If he had known it was this money, he would have preferred not to let Mora spend it.

Pelei kept pulling at his hair, saying, "The deficit is so huge, and even with all the profits from the 'orchard,' the national treasury only has gold left."

But even if the hole in front of us doubled, it would still be difficult to fill.

Pelei counted them off one by one. "The noble annuity, the reconstruction cost of the Sixth Legion, the merchant guild debts, and the disbursement and military supplies, all added up to gold."

The Count Lagos was also in a predicament. The duchy's finances were practically bankrupt, and if it weren't for him keeping things in check, things would have fallen into chaos long ago.

"Mora asked me to collect some military rations in Blackwater City for this Civil War. They're probably worth some money and can also be used for military equipment."

Viscount Pele spoke.

The Count Lagos was aware of this matter, after all, when Pelei was the governor of Blackwater City, he was too ruthless, and those hoarding merchants could not monopolize the grain market.

"How much did you collect? Well, every little bit helps."

"I control 40% of the commercial grain in the entire Central Region."

Count Lagos was stunned. "How much?"

"Ton!"

"Pelei, I really underestimated you. This amount of grain is worth a gold coin at the current market price, enough to cover the shortfall."

"Old man, you've miscalculated. This grain is worth at most gold. There are very few grain merchants and chambers of commerce that can buy such a large quantity of wheat."

Once released into the market, it will immediately drive down current grain prices, and at that point, even grain might not be able to be sold.

After listening, the Count Lagos knew that Pelei's words made sense. After all, this wealth was something Pelei had carefully managed, and it would be a pity to sell it off cheaply. Moreover, even if it were sold off cheaply, it wouldn't be enough to fill the financial hole.

"Since you put it that way, Pelei, you must have a good idea."

Pelei nodded.

"My idea is that we should pay back the money to the chambers of commerce first! After all, these chambers of commerce are backed by nobles and Ducal House from various regions. Paying back their money is more important than paying pensions to the Court Noble."

Lagos nodded in agreement, acknowledging Pelei's assessment.

"Then we'll borrow money from these chambers of commerce, using this batch of grain as collateral. Even if we can't get the cash, we should at least get something."

Upon hearing this, Count Lagos immediately stood up. "Yes, that's exactly what we should do. Selling it might not be worth that much, but as collateral, it can be valued at the current grain price."

"That would be enough money for us. If we win the Civil War, this money won't be a big problem, and our financial situation will be solved."

Even if the orchard's profits don't improve, the assets we've gained from betraying the nobles will be enough for us to live comfortably for a few years, allowing us to calmly and properly reorganize the duchy.

"Pelei, I'm really impressed with you. You're no longer that little tagalong who followed Mora around like a shadow."

"Grandpa, if you keep saying that, I'll get angry."

Despite saying that, Pelei laughed it off. He didn't mind the Count Lagos talking about him from his childhood; on the contrary, he was happy to be Mora's follower.

After all, there are at least 20 or 50 members of the collateral branches of the Ducal House who live off the meager pensions of the Court Noble. Only a lucky few have the opportunity to become high-ranking officials in the duchy's court. With the backing of the Grand Duke, he has already obtained a starting point that many people dream of.

If it weren't for Mora's support, he wouldn't have been able to make such a fortune in Blackwater City by collecting grain.

He collected far more than tons of grain, but tons, and he had already sold off those tons at high prices; otherwise, the price of grain would have been even higher.