Kalistani Major History

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Kalistani Enters Recession; Monetary Crisis hits 3rd monthShockwaves begin to be felt around Seleya
Kaliburg, Ananto
November 20, 4439


Millions of Kalistanis seek direct pay under Industry and Commerce programs designed to help unemployed people survive

Kalistan has seen negative economic growth now for half a year, officially putting Kalistan into a Great Recession. The Government has worked overtime, being granted extralegislative powers to attempt to deal with the crisis causes by a general loss of confidence in the Kalistani economy, and the ensuing monetary crisis which followed on the heels of the shuttering of the Banks last August.

Currency has become scarce and a deflationary spiral has set in, whereby hard currency is at a premium in the society and few have work.  The increased value of Kalistani currency has caused prices to drop on domestic made goods, which has further exacerbated the crisis for Kalistani producers, who have now laid off more than 20 million Kalistani Laborers.  As workers are laid off, tax revenues decrease, and the government is less able to fund poor relief programs.

"We are keeping the lights on with what we are currently bringing in,"  Finance Minister Julie Westin said.  "But that isn't much.  A lot of our money now goes out just to pay for the minimum requirements of our social system.  We keep the hospitals open, but we triage.  A lot of folks with scrapes and cuts are often sent directly to the pharmacy for OTC care rather than being seen by a doctor.  ODEN has been helping maintain our agriculture programs, because they benefit from them as well, but the NSP has ground to a halt, as there simply is no more money right now for new projects.  It's a real mess."

Hoping that Kalistan's economy has finally hit rock bottom, the Government is weighing raising taxes.  Minister Westin said:  "People are hording cash, so we have to pull that out of the economy and start buying imported goods.  But as long as they are sleeping on the money, it will be difficult to even get a lot of consumer goods into the market, because to be honest with you, many of the companies that made consumer goods last November don't exist anymore this November."

The currency crisis has gotten so bad that desperate Districts have been temporarily authorized to issue District scrip that will serve as currency until the Kalistani Republican Bank reopens.  "We have authorized each District to print and circulate something on the order of 200 Billion Rubles worth of scrip to circulate until the Bank reopens.  This is about 6 months worth of currency, if used sparingly, and should give us enough time to get our reserves built up, so that we can reopen the bank on sound footing.  Nothing would be worse than reopening the bank prematurely."  The Republican Government expressly forbade the private speculation in this District Scrip, but of course, that did not stop greedy public actors from attempting to completely undermine the value of the new Scrip by short selling the currency and raising prices in the Market for goods and services paid for by the Scrip. 

"This crisis in Kalistan may spread beyond our borders," Westin said, "But we are doing our damnedest to keep it contained to Kalistan. Fingers crossed, the financial downturn caused by the loss of our Premier doesn't infect other countries in Seleya."

The Kalistani Indicies are still down, but the rate of decline over the previous six month has slowed, and Kalistani stocks are almost flat, dropping just .34% on the week.