[HPforGrownups] Gringotts - Banking Q & A; mostly Q

[manawydan]

No: HPFGUIDX 96598

bboy_mn asked:

>-Does your money draw interest?

We've never seen any reference to cheques, plastic money, or even paper in
the WW and nothing explicit to show anyone being charged or paid interest.

But given their impecuniousness, why else would the Weasleys have a vault?
On the Ministry's low wages, even the little bit of interest that a vault
might earn wouldn't be something that Arthur and Molly would turn down. So
I'd say that points more towards Gringotts paying interest than not.

It would also support the "endowment" theory of where Hogwarts gets its
money: if they have a Gringotts vault whose interest is sufficient to cover
all their possible costs, then they are completely self supporting.

>-Can the Goblins use the money in your vault to make loans or
>investments? Or... do you have to transfer sums of money to a goblin
>interest bearing investment account?

No canon support either way for this one...

>-Is your money insured? As well as depositor's insurance, I can easily
>see Gringotts involved in selling insurance of all types. That's
>certainly a better gamble than backing Ludo Bagman.

Hagrid thought that anyone trying to break in was on a hiding to nothing,
but shortly afterwards Quirrell got in and out again without being eaten or
even caught. I don't _see_ Gringotts as being the sort of establishment that
has "depositor beware" above the door, it wouldn't be good for business. But
then, who knows...

>-Do the goblins provide advance investment services? It's clear that
>goblins aren't in the business of banking for benevolent reasons. They
>want to make money. To make money, they have to engage in investments
>of some sort.

Alternatively, they _could_ make their profits and pay interest to
depositors by virtue of their control of the money supply. Which is literal.
They mint it.It also seems to be them who are in charge of "recovering"
hidden deposits of gold and precious items via their curse breakers, but
that's a limited resource (and nowadays, noone's going to add to the hidden
treasures, knowing that a goblin's going to lay hands on it at some future
point.

But possibly (and thinking about the folkloric association of goblins with
mining in our world) they have some sort of monopoly on mining (or perhaps
just mining of precious metals and gems).

And there may also be some sort of "recycling" if someone hasn't accessed
their vault for x number of years (or centuries)...

>-How big a return do you get on your investments? ...5%? ...10%?
>...20%? How big a return do the Goblins get on your money?
>-Do the Goblins have local authorization to take loot from cursed
>tomes? Are they 'Tome Raiders' or are they working in cooperation with
>local governments in return for a share of the treasure? ...or both?

It all seems to be done in the open and above board. If they were doing it
on the sly then I don't think that would be the case. But if the goblins
have an international monopoly on "stuff underground" then maybe they can do
what they like and the local government doesn't get a look in.

>-Do goblins allow their investments to spill over into the muggle
>world? Are goblins investing on Wall Street? Goblins seem to have an
>'anything for a buck' attitude about making money. If money is to be
>made in the muggle world, would they take advantage of it?
>-Do, as I very much suspect, the Goblins have muggle 'front'
>businesses that they use to funnel money into and out of the muggle
>world?

A literal version of Harold Wilson's "gnomes of Zurich"!

I'd disagree on this one, just because I don't think that the WW would let
them meddle with Muggles to that extent.

There must obviously be _some_ interaction, because they can change Muggle
money (which implies that they have a means of working out what the exchange
rate is, and also that there is something they can _do_ with that Muggle
money afterwards) but I don't think it's allowed to be on a large scale.

>-How shady are the Goblins investments? Would they be above
>questionable business practices? Would the go so far as to manipulate
>the stock or currency markets? Would they fan the flames of civil
>advantage?

Of course they would! Turbulent folk, goblins, as witness all those goblin
rebellions that are Binnsy's area of expertise. Canon of course doesn't
specify (though I know it's the accepted wisdom) that those rebellions were
against humanity, they could just as easily have been internal civil strife
in goblindom, or a mixture of the two. I think they are going to be
supporters of the winning side, and if that means backing both sides, then
so be it.

But there's so many other questions about goblins, aren't there? How is
goblindom organised? Who governs it? What does a "goblin family" actually
mean, socially and culturally? Are Gringotts international or are there
other banks? We don't even know whether Gringott is male or female (or
indeed whether goblins have males and females...)

For JKR alone knows all

Cheers

Ffred

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