Run on The Neopoint: Part One
They say the neopoint keeps Neopia running. From the smallest to the very largest of transactions are always done in neopoints. Most Neopians spend a very large portion of their lives dealing with neopoints, often toiling hours on end everyday for years on end in order to accumulate more and more.
Of course, no one works just for the neopoints. No, they toil because they can buy almost anything else using those neopoints. The neopoint is essentially worthless on its own, and carries worth only because it can be traded for other things of real value.
In a way, the neopoint forms the substratum for modern Neopian society. The neopoint is a symbol of the trust carried by all Neopians, who are certain that they can always exchange their neopoints for something else. Even the pirates on Krawk Island will eagerly take neopoints as payment, even though the Island relies on the dubloon as its official currency. As an example, when the elusive pirate Sneaky Sam was finally caught, it was found that he kept a large reserve of neopoints in case he needed to pay off someone. There was not a dubloon among them.
Where did it all start out like this? The first inhabitants of Neopia were the faeries, and they usually simply traded favors or used a metal they called Everstelium as a medium of exchange, for the metal was widely used in their magical spells and did not corrode over time and thus could be stored for very long periods easily. Dr. Sloth came next, at a time when Neopia was barren of Neopets, and one can only assume that where he came from had to have some sort of currency, but he's never come forward to explicitly say what, and of course no one has ever tried to go and actually ask him.
Then one day it all changed. No one knows who actually created the neopoint; some say it was the Meepits or the elusive Sway. But, for some reason, its use spread like wildfire all over Neopia. Some say that someone cast a spell, while others believe that some sinister being wished that all should use the neopoint. Perhaps we will never know what really happened. What we do know is that eventually all Neopets began using neopoints and trusting in their value, and even the Faeries eventually abandoned using Everstelium and adopted the neopoint. By approximately 2500 B.N., the neopoint was a cosmopolitan currency.
The neopoint has ruled unchallenged since then, being the only true universal currency in Neopia. Its challengers like the dubloon don't even come close to truly matching its value. But, what if one day this foundation of Neopian society crumbles? What sort of chaos would ensue? One can only imagine.
Professor James Chadwick woke up with a start. He felt sleepy, but he had that uncomfortable feeling that one has when one thinks one has overslept. He woke up and checked the clock, no, he was still ten minutes early. Deciding that some more sleep wouldn't do him any good, he got up.
The first thing that anyone would say when seeing the Shadow Draik would be surprise at him being a professor so young. Chad, as he liked to be called had always been a prodigious child and obtained his doctorate early. He taught economics at Neopia Central University. He got up, got dressed, and finished his breakfast. He only taught a special class once every Saturday. On other days though, he went about his own business.
The doorbell rang. It was seven already and that bell could only have been Monica, a doctoral candidate studying under him. She was a Disco Wocky and a only a year younger than Chadwick.
"I'll just be right out," he said and left to go upstairs to his Safety Deposit Box. Today was a big day, and he had to go and make a big deal. He took out a suitcase, and withdrew five thousand Two Dubloon Coins from the Safety Deposit Box. He took a Pant Devil Attractor, though he wasn't sure that it would really work, he did it anyway as he was taking a very large amount.
He stepped outside; it was a nice morning, not too hot, and not too cold. The sun was shining and was occasionally veiled by some drifting clouds. Monica took a glance at his suitcase bud didn't say anything.
Most of Chad's peers at Neopia Central U. spent most of their free time pouring over books and writing research papers. Chad did both, but he did his real research in his field, Economics, in real life.
Which was why he was taking a visit to the Stock Market today. He knew this route well, as it was his job as a professor really didn't pay that much, but that didn't matter as he had spent years making neopoints on his own by investing them.
They reached the Stock Market within ten minutes. Now, when most people imagined the Stock Market they imagined a crowded place filled with Neopets in fine suits shouting orders over each other.
That was a very wrong picture. Even in the old days, the Market had never been like that. It was actually a very open area, and most of the people there were dressed up in casual clothes except for the employees, and there was certainly no shouting. There were two orderly lines, one for those selling and one for those buying shares. Some Neopets were checking their portfolios while others were browsing the list of companies.
Unlike what most people thought, most of the Stock Market was a very orderly place of operation. The strategy that most people used was to buy a stock at the minimum value, usually 15 neopoints, and then sell whenever it would go up, and after all, all stocks eventually went up. The only thing was that it could take months or even sometimes years before a stock would be ready to sell.
Of course, that was jus the normal Stock Market. There were other rooms in the buildings, rooms that very few Neopets knew about. Some people said that shady black market deals went on in those rooms, but Chad knew that everything done in them was perfectly legal.
No, what these people did was specialize in other kinds of investments asides from selling stocks. One could buy treasuries of various countries, or buy specialized shares of various companies. There were over hundreds of different kinds of investment vehicles that were available.
"So, what are buying today? Or selling?" Monica asked.
"Dubloons," Chad answered. "I had made an investment in five thousand One Dubloon Coins around three and a half years ago, and now its time to reap its fruit."
"Ouch," Monica said. "You must have taken quite a hit."
"And why is that?" Chad asked as he opened a door in where there was a single Green Bruce in a nice suit, like most Neopets would imagine would be present at the Stock Market. A plaque on his desk read Mr. Keiths.
"The dubloon has fallen in price over the last two years," Monica said. "The One Dubloon Coin used to go for around three thousand neopoints and now only goes for around eight-hundred and fifty neopoints. You just lost around three-fourths of your invested neopoints."
Chad just shook his head with a smile. "That's not true. You see, Mr. Keiths is a short selling specialist."
Mr. Keiths nodded. "So I take it that you're pretty happy with your choice? I do think that you made quite a lot."
"What does that mean?" Monica asked, taking a seat after Chad had taken one.
"You know, of course, how you can make money if an item increases in value, by buying it and selling it later. That's betting that it will increase in value and is called going long on an item. But you can also make a profit if you bet that something loses its value and then it goes down in price," Chad said.
"How?" Monica asked.
"Simple," Mr. Keiths said. "You borrow what you think is going to lose its value for some time, and then sell it. Then, once it loses its price you pay it back and pocket the difference."
"For example," Chad said, "I had agreed to borrow five thousand One Dubloon Coins and return the same number three years later. I then took them and sold them for three thousand neopoints each. Now, I bought these a week ago for eight-hundred and fifty neopoints and now I return them. Of course, I have to pay a rental fee and Mr. Robert's commission, and that means that the difference is around two thousand per neopoint. And for five thousand dubloons..."
"You just made around ten million neopoints," Monica finished.
"Yes, and now I'll go return these," Mr. Keiths said. "You can really go ahead and short almost anything that you can buy, like goods or stocks as well."
"Some people don't like short sellers though," Chad said. "They believe it to be a tad bit immoral to make money by betting that something will lose value, though I don't really see the logic behind. That will be all for now, Mr. Keiths."
Chad left as Monica began scribbling in her notebook about what had just happened. She was a pretty fast learner, and no doubt would somehow incorporate what had just happened into her thesis.
But while Chad and his student managed to leave the Stock Market unharmed, the same couldn't be said for Mr. Keiths.
You see, once the deal had been made, Mr. Keiths had begun to relax. He opened up his desk and began filing through paperwork. The door opened and he said, "Welcome," without even glancing up.
And then whoever had knocked came in and held something in front of Mr. Robert's face.
It took the Green Bruce an entire ten seconds to realize that it was the hilt of a dagger and the figure in front of him was wearing an eye patch.
To be continued...