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1. Preventing Fraud. There are many ways to do it. Most of it has to do with the Money Market, Company purchases and product trading. Basically it is going to be too difficult to police all the stock companies and all their daily actions. Rather it would be easier to set certain perimeters for trading/purchases.
a. Purchasing businesses is easy since there are already limits set for normal citizens...use that or a percentage,
b. Money market purchase limitations may be harder to implement as far as game mechanics go but would help to prevent fraud. Since most of the currency information is track-able it should be simple to set a plus/minus limit for the money market trading. One might use a percentage but this would do harm to currency trading for small nations who's money markets may fluctuate greatly over the course of a few days in terms of percentage but not necessarily in terms on decimal places
Besides, very few players who are out to defraud their investors would use incremental digits to siphon the funds away. More likely they are lazy and prefer whole integers :-/
c. Market or Product purchases are easier to conceptualize than the money market as it is just a simple price and there is a baseline available. Using trade values associated with off-site trading venues (such as chat) product price correlation is straight forward. The setting would not allow the stock company to sell or buy products beyond xx value of the baseline indicator. The only other consideration would be the current inflation and currency fluctuations, which can be accounted for by applying (1b) currency limitations.
2. The stock company concept should also be expanded to include state ownership. Many nations could use a highly centralized and fraud resistant base for financial operations. A stock company is a good blend of both the liberal economic abilities of the Org with the structure and base of a military unit.
a. I would also argue that the Nationalized stock company will be highly utilized by smaller, more flexible nations while the larger bureaucratic states will rely on a decentralized theme of both governance and economics. Also, I would like to personally donate my stock company to my country, another very valid reason to change the system
3. Mutual Funds. This concept is simple to add to the current system. A mutual fund is simply a stock company that invests in other stock companies in order to diversify holdings, mitigate risks and provide a cosmopolitan portfolio for investors. Mutual fund companies would not be allowed to hold businesses but could be allowed access to the money & product markets. Mutual funds should also have a limited number of holdings allowed to prevent fraud by monopoly or insider trading. For example a Mutual firm might have controlling interest in a stock company (50% shareholder) but may not have controlling interest in a second stock company (insider trading). Likewise a mutual firm should be limited in the overall number of stock companies it may invest in (monopoly) in order to not unduly influence the market overall. The mutual company is a good option for investor leery of new stock company start-ups. Less risk, less reward and certainly less fraud. Mutual funds would essentially be the Q2 of stock companies and should cost a huge pile of gold to create in order to discriminate both the number of mutual funds and the type of individual who might start one. No level 7 players running a mutual fund please
4. Bond system.Bonds are government issued, fully guaranteed stocks that add interest over time. They are issued by governments who need investment capital and are backed by the treasury of the government. Certainly a limited bond system would be a useful tool of government throughout e-sim. Since bonds are backed by the issuing government they may only be purchased by that nations citizens (in order to avoid monopolies like one country or one mutual fund technically owning another nation). bonding would also be quite useful for newer nations still under protection in order to spur financial growth and overall infrastructure. Just like in RL bonds may only be issued by the shareholders (in this case citizens) and so it requires a majority vote to implement. The number of shares, share value and rate of return must be tied directly to the countries economy (ie tax income, stock company income, etc.) in order to help prevent the possibility of bonds going into default. Since tax income remains fairly stable and tends to grow overtime based on the number of citizens, companies, etc then it is easy to create projected repayment plans of bonds+interest. Bonds would represent a stable investment source, one that governments do not often utilize and which provides only token interest bearing upon maturity. A bond rating system based on RL modals (see Moody's, S&P, etc.) would be easy to calculate and easily recognized by citizens (though I prefer S&P's standards).
4. Stock company ratings. This simple change will help the new-ish investors to discriminate between established, stable companies and potentially risky start-ups. It applies the concept of market capitalization which is already somewhat being implemented. market capitalization is based of the current stock price multiplied by the number of outstanding shares (which, in the current module is all shares issued). The only change necessarily in order to make game mechanics work would be to use the calculated stock value currently shown on the stock companies home page rather then the current buy/sell rates. thus a company may have 1000 outstanding stock and have a calculated stock value of 2Gold. Market capitalization for this company would be 2000G whereas a start-up with 200 shares valued at 3G would have a capitalization of only 600G. It would be easy to make these calculations and then create a tier labeling system that describes in one/two words the risk involved with investing with that company. Rather than using a bland, biasing low-mid-high rating I would rather go with the RL industry designations and an accompanying modifier.Income stock (conservative growth), Blue Chip (moderate growth, moderate risk), Aggressive (high growth, high risk) are the three main tiers I would use. A flashy new icon and a badge of honor for CEO's.
5. Industry Risk. This may venture beyond what many would consider relevant to the game but I think that having a industry risk label within the stock company makes for safer albeit "dumb-ed down" investors. It is a well known fact that certain industries (and their varying quality levels) are financially more viable than others. A Q5 food company will generate more income than a q1 stone company. Essentially this idea is taken to the next level when the same rationale is applied to the entire corporate holdings of a stock company. A company with 3 Q5 companies will receive a higher rating than the company with Q2/Q3 companies. Easy to establish as well is the fact that weapon, food and gift companies are more profitable than ticket, house and defense system companies (although there are always exceptions). Personally the only deviation from the profitability line of thinking is when it comes to raw material companies. Raw goods have a stability factor inherent in them since they require no goods to be produced, only labour. They also historically have little deviation in the baseline market price and thus are not easily influenced by external factors (like taxes, exchange rates, lack of demand, etc.) Basic enough for new investors but detailed enough for savy market traders.
6. Investment Prospectus. This is basically the equivalent of a congressional or presidential platform/announcement for a citizen. It is a linked article tying a published document to the company that allows it to go into more detail than the simple Company Statute. This may be difficult to create in-game since stock companies do not own newspapers nor should they. No one wants the news flooded with "buy my stock" hype articles...we get enough of that in the shout box already :/ Nevertheless having a means of publishing a business plan, give detailed company history as well as CEO resume would be well worth it in the investment-education front. It would also weed out the lazy CEO's from the good ones which is always an indicator of risk
7. Market open/close periods. While this is necessary for obvious RL reasons it would also be a good in game resource. The always-on nature does not allow CEO's to effectively manage their holdings/shares making it difficult to protect their investors from predatory traders. I would like to see a closed-market feature that can be enabled before any major changes take place to a stock company (such as issue stock, change outstanding share pricing, etc.). This CEO button can be pressed anytime one of the major votes is underway. The feature effectively closes the ability to sell/purchase shares as well as see (but not post) buy/sell offers. This adds depth to the module while removing the ability for some smart folks to "play" the market. The "blind bid" during the market downtime will create speculation and add to the risk/reward of investing.
While there are a hundred other things I could mention but these I chose based on either their ease to implement or the great depth they could add to what is already becoming a fascinating module.
Comments are appreciated
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About the game:
USA as a world power? In E-Sim it is possible!
In E-Sim we have a huge, living world, which is a mirror copy of the Earth. Well, maybe not completely mirrored, because the balance of power in this virtual world looks a bit different than in real life. In E-Sim, USA does not have to be a world superpower, It can be efficiently managed as a much smaller country that has entrepreneurial citizens that support it's foundation. Everything depends on the players themselves and how they decide to shape the political map of the game.
Work for the good of your country and see it rise to an empire.
Activities in this game are divided into several modules. First is the economy as a citizen in a country of your choice you must work to earn money, which you will get to spend for example, on food or purchase of weapons which are critical for your progress as a fighter. You will work in either private companies which are owned by players or government companies which are owned by the state. After progressing in the game you will finally get the opportunity to set up your own business and hire other players. If it prospers, we can even change it into a joint-stock company and enter the stock market and get even more money in this way.
In E-Sim, international wars are nothing out of the ordinary.
Become an influential politician.
The second module is a politics. Just like in real life politics in E-Sim are an extremely powerful tool that can be used for your own purposes. From time to time there are elections in the game in which you will not only vote, but also have the ability to run for the head of the party you're in. You can also apply for congress, where once elected you will be given the right to vote on laws proposed by your fellow congress members or your president and propose laws yourself. Voting on laws is important for your country as it can shape the lives of those around you. You can also try to become the head of a given party, and even take part in presidential elections and decide on the shape of the foreign policy of a given state (for example, who to declare war on). Career in politics is obviously not easy and in order to succeed in it, you have to have a good plan and compete for the votes of voters.
You can go bankrupt or become a rich man while playing the stock market.
The international war.
The last and probably the most important module is military. In E-Sim, countries are constantly fighting each other for control over territories which in return grant them access to more valuable raw materials. For this purpose, they form alliances, they fight international wars, but they also have to deal with, for example, uprisings in conquered countries or civil wars, which may explode on their territory. You can also take part in these clashes, although you are also given the opportunity to lead a life as a pacifist who focuses on other activities in the game (for example, running a successful newspaper or selling products).
At the auction you can sell or buy your dream inventory.
E-Sim is a unique browser game. It's creators ensured realistic representation of the mechanisms present in the real world and gave all power to the players who shape the image of the virtual Earth according to their own. So come and join them and help your country achieve its full potential.
Invest, produce and sell - be an entrepreneur in E-Sim.
Take part in numerous events for the E-Sim community.
