Today we are going to do something just slightly different from the usual pontifications on the human condition, and ... pontificate on ... the ... human condition.

BUT! We will be doing it in two majorly different ways. The first, is that this will take place in the Star Wars universe, and the second is that we are focusing a little bit more on the nitty gritty details of what makes humanity tick: Macroeconomics.

... I feel like I could have made that more dramatic, but I probably shouldn't ... Anyway, the central conceit to the story is this: The Hutts had integrated themselves deeply into the Galactic Banking sector for access to cheap money, they got this, and lived in great luxury. But they aren't known for being honest merchants... oops.

Secondary Note: I wish the reasonings of the various financial institutions and concepts written below were purely fictitious, hahahah ... If anyone reading this works for a Ratings Agency and wants to talk to me, please!

Tertiary Note: I talk about the way this particular setting changed in my YouTube channel. The easiest way is through the pinned message in my subreddit at /r/MinimalistMusings/

Implosion of the Hutt Cartel

It started innocuously enough. Slave rebellions were a rather common sight within Hutt Space, so nobody was surprised when another charismatic upstart launched a campaign against the dominance of the Hutts. The expectation within the Republic, the IBC that had its own interests in Hutt space, and even among the population itself were that mercenaries brought in by the overlords would soon put down the uprising and life would go back to its stagnant normalcy.

However, that is not what happened. Not only did the upstart warlord defeat the various mercenary faction sent to destroy her, over twenty years, the rot of the periphery had spread into the core of Hutt space. Every rumour of defeat fuelling local underground societies until every planet in Hutt space was filled with rebels organizing quietly, even while the upper layers of society remained almost oblivious. After all, the Hutts had weathered rebellions before, had done so for millennia, and there was certainty that they would do so again.

During this time the warlord herself seemed to have disappeared, traces of her presence pointing towards Wild Space. By now, her presence was no longer necessary; indeed, many of the newer outfits had not even heard of her exploits. Instead, these new rebels simply drew on the roiling discontent spread by the persistency of rumours of Hutt vulnerability.

The seeds of discontent soon reached Nal Hutta itself. Like much of Hutt politics, Nar Shaddaa was simultaneously thin end of the wedge and the jumping off point for further discontent. While the major players in the Cartel had a firm grip on the surface of Hutta, the hive-like cities on Nar Shaddaa were almost impossible to control. With the mounting unrest, layers upon layers of the city-moon were lost to various groups of revolutionaries, rebels, and reactionaries, giving the factions a safe space to thrive. But more importantly, it meant that there was a constant source of discontent beamed directly onto Nal Hutta.

To counter this increased unrest, Hutta itself was flooded with Mercenaries, every player spending massive amounts to firm their own control. Yet, even with massive repression, within a decade the planet was in open rebellion, with the major powerblocks splintering as the prosperity promised by the Hutt Pyramid Schemes fell apart in the face of persistent labour shortage, and rising insurance cost. Combined with the cost of bringing in ever larger amounts of mercenaries, the situation quickly became untenable. That is when the Ratings Agencies stepped in.

Originally, Hutt Shell Corporations had applied for and integrated themselves into the Ratings systems used by the Republic to classify risk to bring in cheap credit in the form of quadrillion of credits in investment from the various component Hedge Funds and Investment Banks of the InterGalactic Banking Clan (IBC). The upside of this loss of sovereignty was the massive investment inflows from within Republic space that could now "safely" invest in Hutt space. While it was not needed for the venture arms of the IBC holdings, the Ratings Agencies imparted a certain amount of legitimacy to the Hutt corporations, which added to the prestige that already came with doing business with the IBC.

In the good times, this meant that the expertly cooked books of the Hutts convinced the Ratings Agencies to give universally high ratings to Cartel bonds. Hutt Shell Corporations received on average AA+ (the second highest in existence) across the entire space. This allowed institutional investors, such as retirement funds, insurance companies, and big mutual funds, who were desperately in search of yield within the Republic, to pile in. As a result, over the five-hundred years preceding the latest rebellion, quintillion credits flowed into Hutt space via the legitimacy granted by the existence of the ratings, dramatically enriching the Hutts sitting at the top of their domain, by buying countless junk bonds which were repackaged as safe (AA+) assets.

However, this was now all thrown into disarray. With the prolonged unrest in Hutt space reaching an intensity not seen in millennia, the Ratings Agencies were forced to start downgrading Hutt Corporations. This was recognized as a threat to the Cartel early on in the rebellions on the fringe of Hutt space. In fact, the Cartel came together in a lobby to make sure that the Ratings Agencies were provided with the "real" facts, which reflected, in the view of the Hutts, the proper situation on the ground.

For the first two decades, this was accepted without complaint by the Ratings Agencies, which themselves were under pressure from the buy-side (i.e. the big institutional investors) to maintain ratings so that the latter could continue to buy the high-growth positions offered by the Hutt Corporations. However, with the open rebellion on Nal Hutta, fiduciary duty within the Ratings Agencies finally won out over lobbying. Therefore, the three major agencies (Alderaan Financial, Corellia Galactic, and IBC Ratings) simultaneously downgraded Hutt Corporations across the board.

Even though this initial downgrade of Hutt bonds was only one single notch, from an average of AA+ to A, the consequence was severe. Since their underlying assets were essentially junk, Hutts sold their bonds with the intention of rolling them over in perpetuity, that is to say, using new issuance to pay off expiring bonds. Together with clever financial contracts, this meant that for the Hutts only minimal interest rates needed to be repaid. However with the downgrade, there was a sudden demand for extra collateral when rolling over corporate bonds.

This the Hutts did not have. Consequently, one Hutt corporation after another failed to meet their payment deadlines as negotiations with bond holders started to drag on. The first Hutt corporation to fully default on a bond payment was a small mining conglomerate owned by the "great" Jabba (the Hutt). On paper, the conglomerate had interests in everything from basic iron to the rare metals used in the most advanced hyperdrives. However, when private investigators hired by the institutional bondholders visited the purported mining stations and warehouses pledged as collateral, they found either nothing, or worse, signs of a hurried evacuation. In one of the biggest Galactic Scandals, further investigation revealed that across all of Hutt space, companies linked to Jabba had gone silent. The accumulated wealth of one of the smaller powers in the Hutt Cartel simply vanished from all Republic records.

This led to panic among the great institutional investors. Even as more investigators were sent out to ascertain the validity of other Hutt corporations, the Ratings Agencies were coming under pressure to downgrade further Hutt assets. In an effort to prove their own ratings systems sound, the agencies sent their own agents. Working together with the great powers running the Cartel, the agencies were able to temporarily halt a cycle of downgrades, leaving the major Hutt corporations intact, with downgrades only hitting the bonds of the corporations associated with the lesser Hutts.

Thus the initial wave of defaults was limited to the smaller names within the Hutt Cartel. Reaction to this within the powerblock was one of glee, as rival businesses and coveted assets were picked up at (what were thought to be) fire-sale prices. In fact, this set of mergers was financed by even more debt, with the major Cartel members pledging additional assets to finance their own consolidation. While this managed to prop up prices for a time, stabilizing the sector, further deterioration in the fundamentals (read: rebellions on critical Hutt planets) meant that asset prices remained under intense pressure. The more conservative institutional investors were starting to become uncomfortable with the continued unrest, and while the ratings remained in the safe category, more than one pension fund cited its own fiduciary duty when pulling investments from Hutt space.

So even as the Hutt Cartel was undergoing a period of consolidation, price pressure forced more and more members of the Cartel to go into administration. This release of a supply glut quickly depressed asset prices to such a point that even the collateral of the solvent Hutts were being discounted. Leaving them no choice, the Ratings Agencies finally started a wholesale downgrade of major Hutt corporations. This forced even more institutional investors to to sell, creating a downward spiralling valuation loop as forced selling led to further downgrades, which prompted further retreat.

While the Cartel itself could have dealt with the problem internally, the sheer weight of the defaults could not be hidden. Very quickly, squabbling among the surviving Cartel members descended into vicious internecine warfare over ever-shrinking profit margins. Until one major player defaulted on his payment to a major mercenary group, which prompted the Private Military Company (PMC) to initiate a hostile (with proper weapons) takeover of all of the Hutt's assets on Nal Hutta. While he managed to escape with his life, the majority of his assets were confiscated, and sold at steep discounts to repay the PMC.

The liquidation of a major Hutt in the Cartel sent shockwaves through the entire system. With confidence at an all-time low and still plummeting, PMCs hired by the other big Hutts corporations took the initiative and pre-empted a default. Throughout Hutt space, mercenaries simply turned on their employers, and forced them to sign over the vast, but crumbling business empires in exchange for their own lives.

Perhaps unfortunately for the PMCs, but definitely unfortunate for the workers, running a private military company was nothing like running smuggling, extortion and other illicit operations. This was especially true since the previous deep integration with the Republic meant that major source of profits within these sectors depended on a veneer of legitimacy from shell corporations who had links to the various ratings agencies. So when these were taken over in a moment of pure extortion, even the ratings agencies were unable to maintain their business, being pressured by the Republican Senate to halt all work with the new warlords.

This collapse of the rent system caused a further deterioration in the rapidly shrinking economies of the former Hutt Worlds. Within a year, the supply chains that held together the former Hutt business empires simply imploded. Even the PMC warlords themselves were facing open rebellion, with the sector splintering into individual planets, and then individual powerblocks on those planets. Reverting to form, the PMCs entered into vicious civil wars, which left the planets themselves ravaged, and refugees desperately trying to escape the war-torn sector.

News of the disaster quickly spread into the Republic, and was picked up by the comfortable middle class. Across thousands of worlds in the Core, activists took up the cause of the fleeing slaves, as if it were the first time they have heard of the problem. And so, while solutions to this issue was heavily debated, demonstrated, and demanded by then bourgeois within the Republic, and while millions of influencers and media stars cried out for those poor unfortunate souls in the former Hutt space, while Senators gave speech after speech about the importance of helping those who have been caught in the vicious civil war and the rights of the slaves, nothing more was done.

And thus this unlikely combination of Republic inaction and devolved power vacuum gave society time to slowly pull together on Glorious Jewel (Nal Hutta). Over the next hundred years, a hesitant confederation grew on the planet formed from individual groups led by former slaves, or their descendants. Having borne generations of oppression under the Hutts, one of the defining traits of this new generation was a thirst of knowledge but also of relentless self sufficiency, and financial freedom.

As the abandoned slaves and their descendants found themselves abandoned by their former masters, and in an truly farsighted desire to preserve their knowledge, key individuals in the early days of the interregnum turned to knowledge maintenance. Various leaders of society travelled far and wide to gather blueprints, tech manuals, and even farming handbooks. Everything was valued, because everything could help in rebuilding. As their repositories got ever larger, these early heroes of civilization formed the first libraries.

It was around these libraries that society grew, and slowly rebuilt. Initially co-operative workshops set up within easy range of the precious knowledge. As the need to build and expand came, a wide variety of businesses grew up surrounding the central great libraries, and with the expansion, came civilian settlements. Even then, no area was self sufficient on the Jewel, and out of the initial settlements, trading corporations developed to help match the fluctuations in supply and demand. These trade routes, and the centralization afforded by the continued upkeep of modern communications, allowed the trading companies to act as a social glue that kept incentives in the post-revolution planet mostly aligned.

By the time of confederation, the great libraries had evolved into self-sustaining Research organizations. Even as the trading companies competed in friendly terms among each other, their help in building a planetary communications web allowed the scientist to engage in the same passionate competition. For the first time in many years, there was an organized application of the Scientific Principle in the Galaxy as the scarcity on the abused planet forced society to become more flexible. This new mindset helped the burgeoning population to adapt, and to create *new* ways of doing things instead of simply repurposing existing technology from scrapyards.

And so, because of their critical role in the preservation, and development of knowledge throughout the interregnum, the scientists on the Glorious Jewel inherited an overwhelming voice in the Planetary Council. They were followed, only mildly jealously, by the big Trading Houses, themselves having established a firm set of operating principles. Together, the Scientific faction and the Trading faction held nine out of eleven permanent seats in the new Confederated Planetary Government.

Finally united, the Human-dominated government readopted the ancient name of the planet, Evocar. In addition, the new citizens of also adopted the extinct Evocii symbol of unity, the sun. Now calling itself the "Solar Research Council", the star that gave life to the planet represented an optimistic desire for all children of Evocar to rise above their station in life, and build a better world.