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Okay, so I'm on a tear again. Today I'll be talking about competitive advantage, marginal profitability and how that relates to the job market and, to a lesser extent, the money market. Mostly, I'll be using the money market, because it's a much easier example to demonstrate but all the same reasoning applies to the job market, and more so, because it's a much dicier game to turn a profit on production.
First off, I'm not anti-competition nor am I trying to convince people not to compete with the offers I or anyone else put up. Competition is good and it keeps our economy lean and that's a very good thing.
But what makes me absolutely f***ing crazy is when people put up offers greater than the lowest possible incremental change.
In the Money Market, this is a change of .0001 lower than the closest competing offer. Every drop by this increment, in the USD market, is sacrificing a profit of .0025 dollars in order to gain a competitive advantage.
For example, at the time of writing this, the lowest offer to buy gold for USD on the Money Market is 9.5 gold at a rate of 1 gold per 25.15 dollars. Buying this offer out would give the person who posted the offer 238.925 USD (Yes, as far as I understand, the game does track the thousandths place though it is not visible). If someone were to undercut the same offer by the lowest possible increment and offer the same amount of gold, they would lose out on only .005 USD.
But, lets look at the person he undercut with his 25.15 offer. The previous offer is 1 gold per 25.17 USD and he undercut them by .02 USD per gold and the result? He cost himself 18.9 cents for the value of his offer.
So what, right? It's only like 19 cents.
Lets keep looking.
That 25.17 offer undercut the previous offer by .01 and that one, in turn, under cut the offer before that by .0088.
For 9.5 Gold, that's a loss of .368 cents.
Still, so what, right? Well, here's the thing.
On the money market, that marginal profit and loss is your bread and butter. It's by constantly flipping that money back and forth that you slowly gain. But, when that process is being under cut by huge margins, that gain slows to a crawl.
Which wouldn't be a big deal, except for one thing.
It serves no purpose.
It's just throwing money away for absolutely no reason.
Why? Let me answer that question with another question.
What is the advantage in undercutting someone else's offer?
To be the first offer on the list, right? The best deal.
But, if you're the best deal at .0001 less, what's the point of dropping it by .01 instead?
There is none. All you are doing is cheating yourself out of money. And the worst results are when everyone is saying 'well, what's the big deal?', because then the market drops by as much as .5 in a matter of hours. And, for anyone that's ever dealt on the Money Market, that's a big deal.
It's not as big of a deal in the Money Market, because as long as the offers are .0399 and 25.0627, it's still profitable.
So, now what's really making me crazy. The job market.
American wages are really, really high and the prices in our product market are incredibly low. This means that it is incredibly difficult for the people that provide goods, which we all depend on, to make a profit doing so. It's time consuming and the returns are very slim.
So it really, really pisses me off when my peers change the wages by .30 cents to a dollar every time they update jobs. Again, they gain no competitive advantage by doing this; They are no more likely to get an employee at +.01 cents than they are at +.3 cents.
It just blows my mind that people trying to run a business and trying to make money would do this to themselves and to their peers. How can you know how difficult it is to turn a profit on the market and still say, 'Yeah, I can afford to cost everyone and extra .30 per worker.'
And, again, the problem isn't the .30 by itself. But it's the next guy who adds .30 more. And then the first guy comes back and goes up by .60.
Pretty soon wages have gone up 3 dollars in 24 hours and we're all wondering why it's so hard to make a buck? It's not because of low import taxes, it's because of business managers who run businesses but hate money.
Hate money? Yes. Because that is the only explanation. Why else would a rational business owner give away .30 cents a day to their every employee, when that same employee is every bit as likely as they were before, to turn around and take another job for a .01 raise?
You know what's double amazing though? You never see this on the Product Market. It's like only on the sales end do they say 'Hey! That would cost me money!'
I was going to go through all the math but it's a lot of work to do that I have to do all too often, anyway, and you already get my point.
Please, guys. Money is good and it's what keeps this going. If I can't make a solid profit, what's the point of doing all this work? And if there's no point in everyone doing a bunch of work, then where do we get our goods?
Money never did anything to you, except make your life easier.
Stop hating money.
Love,
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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.
