Banking Beta issues

[megapolis]

I have tried new banking DLC for the first time. Did not want to be a beta tester because it's killing me but I probably have to.

Here are my observations:

1. Bond issuer and bond buyer are swapped. In my example below I was buying AI bonds, not vice versa. Also price was decreasing instead of increasing after each purchase.

Caplab bond bug.PNG (59.15 KiB) Viewed 3942 times

2. Next one is probably global. I found out that I don't pay any profit taxes on Real Estate profits. (AI don't pay these taxes as well). I checked older stable version - it is the same there.

3. Global Stock Market. Well, it is a good idea and I understand how can it be used in very-late-game. For example, to offload excessive money out of economy without the awful feeling that I am basically losing the money to inflation.
But in current state it is awful. And I am not talking about stock price rollercoaster. I am talking about its irrelevance to core game. I don't have to play CapLab to have this "buy something with best P/E and never sell" meta-game. I can play This Grand Life. Give me the lore for Global Stock Market. And an explanation of its influence to local economy.

3a. Double click on a company name in global Stock Market window leads to local AI company with the same number on a list.

4. Scripts. I found out that I don't have my old script after the new installation and I have to re-create it. As a result I have the same problem that I had a couple of years ago. Script examples on website are not updated. (For example it still says that maximum number of AI persons is 85 while it is already 100 since February) Scripts in game folder are created in 2013-2014 and were never updated. I need a current script template with all the variables and their explanation.
By the way even the newer scripting options are inconsistent. For example in Digital age in interface I can make all companies go IPO in 5-20 years while in script I can only say Yes or No in IPO variable.
And yes, I want all Banking DLC variables to be scriptable, even now, in beta.

5. 0.25 Loan interest rate change is cool.

[standardplayer]

The Global Stock Market is important for a finance DLC:

-It allows you to create your own mutual fund or holding company like warren buffet from the start if that's all you want to do. This is not for everyone but others have stated an interest in this.

Note: This could just be an initial foundational feature they could add the ability to set up an mutual fund/asset management company in the future where you set up financial advisor branches to collect investment assets and charge a management fee for this service.

viewtopic.php?f=52&t=5099

-It can also play an important part of running financial firms where banks and insurance companies should have the option to invest a portion of their funds in equities or bonds that the in game market might not be able to effectively absorb.

Insurance:
viewtopic.php?f=52&t=5751

David is there any plans to create:
-A Global Bond Market?
-Mutual Fund Companies where you can setup something like Financial Advisory Branches to gather investor assets and charge ~1% AUM to manage the money?

[megapolis]

standardplayer, thank you. You added a use-case that I did not think of. Even more, I occasionally created a fund like this in my test run.
But on the other hand it does not answer my question. My concern is that in its current state it is a black box with only one reasonable strategy (buy the stock with smallest P/E ratio and never sell, or sell the one with biggest P/E). In my opinion it makes it quite hollow.
Anyway I did not say that it is a bad idea. It is a good one. I just hope that it will be attached to the core game somehow.

[megapolis]

I made a short 60-years and here are my observations.

1. Bonds. I don't understand their use case. I already told many years ago that there is a certain point when neither player nor AI don't need money and lack options to invest them into economy. Especially long money. Maybe only one. I want to buy back a lot of my shares and for some reason their price is rather small. I issue a bond and use it to buy it back. (IRL I suspect that SEC will come in and get me for insider trading or bond manipulations )
Now when I see AI issuing a 10M bond while having 250M in cash, my eyes start bleeding. On the other hand I have to say that cities issuing bonds were and are a good idea. Just because cities need long money and have a proper use to them.

2. Global stock market. As I said, it is very hollow now. Just placeholder companies that earn the same money every year, increasing their equity for the same amount of money every year and paying petty dividends (0.5% of share price or 0.05% of equity per year). And none of local companies use it. Even OS and telecom monopolies that sit on 5-6B of cash.
On the other hand unlike bonds, this market is quite interesting and has a perspective. Looking forward to its development and evolution into something bigger and better.

Cheers!

[David]

1. Bonds. I don't understand their use case. I already told many years ago that there is a certain point when neither player nor AI don't need money and lack options to invest them into economy. Especially long money. Maybe only one. I want to buy back a lot of my shares and for some reason their price is rather small. I issue a bond and use it to buy it back. (IRL I suspect that SEC will come in and get me for insider trading or bond manipulations )
Now when I see AI issuing a 10M bond while having 250M in cash, my eyes start bleeding. On the other hand I have to say that cities issuing bonds were and are a good idea. Just because cities need long money and have a proper use to them.

Have you tried the new option "Percentage of Player Capital Funded by Bond" on the new game setting menu ?

FYI, its help text:
If you are an experienced player looking for greater challenge, you may set a percentage of your corporation's initial capital to be funded by a bond issue, requiring you to pay bond interests and repay the bond principal upon its maturity.

You may also set your startup capital or/and the AI's startup capital to low, if you want the bond system to be used by the AI or the player more often.

[megapolis]

Hi David,

Yes, I already tried start with bonds. Honestly, I tried only 3% just to test it.
But I understand your point. Yes, I agree that starting with 100% bond will be a good addition to my starting difficulty. Unfortunately, that's only a one-time use of this system.

As for low AI starting capital, I see it useless. AI is already too stupid and struggling from the very start. Don't see a point in making it struggle even more.

[David]

But I understand your point. Yes, I agree that starting with 100% bond will be a good addition to my starting difficulty. Unfortunately, that's only a one-time use of this system.

There is a possibility that it will make a big difference in the game's challenge level if you start with 80% bond. Why don't you give it a try and see if it changes the gameplay difficulty in a meaningful way?

If you still find it too easy, I understand that there are still over ways that the dev team could implement to further increase the game difficulty, like allowing up to 100% bond at startup and decreasing the startup credit rating to the worst rating, which means massive bond interest payment obligations compared to your very limited cash flow at the startup stage.

As for low AI starting capital, I see it useless. AI is already too stupid and struggling from the very start. Don't see a point in making it struggle even more.

For those players who found the game's difficulty level adequate (not everyone beats the game so easily as you do), when both AI and the player issue bonds, it will be a level playing field, not necessarily making the game easier. And you will end up having more bonds to purchase in the market.

[megapolis]

I have tested 80%. Here's what I see.

More than 80% is unreasonable. So you found a good limit.

Ok, here's an overview of starting conditions.

My normal start on 5.8: $45m cash. $30m Loan@9.75%. 100% ownership. Effective debt rate 6.5%
@80%bond in 6.0.6: $20m cash. $10m Loan@9.75%. 59.13% ownership. Effective debt rate 4.875% (Here I just bought back my loan immediately because I cannot afford its rate)
@80%bond in 6.0.6, harsh credit rating: $40m cash. 10m Loan@9.75%. 20m Bond@10.75%. Effective debt rate 7.81% (decided to leave bond). Fun fact. Under harsh credit rating which should in theory be hard I bought back my bond @$37 which gave me $14m free money. So after that my effective debt rate became 2.99% (but I still own only 59.13% of my company which is still a major problem that I will have to solve later)

With that said it is just the same situation with $10m starting capital instead of $30m. And you don't need to invent bonds for it.

Additonally I tested a start with the bond and played through a couple of years.
Conclusion.
Yes, 80% bond makes starting situation more difficult. But bond itself is not a viable option for me. This money are too expensive. Even adjusted for 3% inflation.
So they are just virtually useless. With poor rating I am unable to bear the price and with good rating I don't need the money knowing that there's an effectively unlimited supply of money on loan market. (I was able to borrow $100B and that was not the limit)
I can see only one situation when I will issue bonds in mid-game. If AI goes IPO and I don't have any money to finance purchase of its stock

[David]

With that said it is just the same situation with $10m starting capital instead of $30m. And you don't need to invent bonds for it.

If it is still too easy, then you may try the extreme setting: $10M starting capital with 80% bond.

Conclusion.
Yes, 80% bond makes starting situation more difficult. But bond itself is not a viable option for me. This money are too expensive. Even adjusted for 3% inflation.

If it is too difficult, then you may adjust the percentage of bond to a value that strikes the best balance for you -- being not too difficult, and not too easy either.

I would say that Capitalism Lab is a highly customizable game. The way you want to play it is totally up to you. You could make it a difficult game or an easy game, so something in between, using the assortment of options it provides.

[megapolis]

David, that is not the point. Why should I use a financial instrument that is more expensive and less flexible? You know that I don't like roleplay and don't see a reason to cut my arms for the sake of it.

As for the difficulty, 10m starting capital is just around minimum reasonable start money. Cutting it more will just increase the length of the start. Which, in my case is already around 5 years. I see no reasons for it.