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Question: Negative interest inside EU ?

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Fiona Simmons

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Mar 11, 2005
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We all know that peds arn't backed up with real usd anymore and the gap between peds and usd is growing every year. What if mindark would introduce negative interest on inactive accounts or accounts that dosn't cycle any money on game mechanics ?

On real life negative interest is reality in some cases already as a tool to encourage investment and cashflow

To prevent becoming subject to negative interest you must cycle 20% of your total accounts tt value within 60 days else mindark remove 0.5% of your total accounts tt value each 30 days.

Probably the day mindark try to install this will the day they go bancrupt because everyone is withdrawing at the same time, so dont worry it wont happen it was only a thought play.
 
Fiona Simmons said:
Probably the day mindark try to install this will the day they go bancrupt because everyone is withdrawing at the same time, so dont worry it wont happen it was only a thought play.
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this, worst idea ever

They can survive for years with selling us stuff like boxes, jewelry, regeneration chips, houses and whatever...no need to kill them instantly :laugh:
 
Fiona Simmons said:
We all know that peds arn't backed up with real usd anymore and the gap between peds and usd is growing every year. What if mindark would introduce negative interest on inactive accounts or accounts that dosn't cycle any money on game mechanics ?

On real life negative interest is reality in some cases already as a tool to encourage investment and cashflow

To prevent becoming subject to negative interest you must cycle 20% of your total accounts tt value within 60 days else mindark remove 0.5% of your total accounts tt value each 30 days.

Probably the day mindark try to install this will the day they go bancrupt because everyone is withdrawing at the same time, so dont worry it wont happen it was only a thought play.
Click to expand...

Fiona Simmons, your mind has a warped angle of approach. :cool:
 
A simple BIG NO to this idea!

Someone not loggin in for to long gets purged, speak very likely will lose a lot of paid MU already due to the fact that all items TT value gets transfered to his PED card and items go back to MA.

After 7 years inactivity, even those PED are lost for this player (account deleted).
 
I would like to point out that OP was clear about it not being a suggestion. OP is curious about what people think would happen.
 
Don't even know where to start... haven't heard anything worse indeed. It's worse even than adding a subscription fee, no matter how high. Really, even a $100/month doesn't seem bad, at worse you just don't pay for a while and lose the convenience of logging in any time you want but don't lose your stuff. Hell, it's worse even than making all items avatar-bound and removing the withdrawal (at least in my book, as I never did wd) :)

It probably would make me quit faster than any other crazy idea, even though it hardly would affect me personally, as I cycle tt value of my account in less than a week, and hardly ever skipped more than 1-2 days in all my years in the game.

And by the way, the purpose of negative interest usually is to prevent investments, e.g. to limit foreign cash inflow. Exactly what would happen with EU.

And the peds unlikely were ever backed by real money, having that amount of cash just sitting idle would be incredibly stupid, and MA is anything but. That's why they did venture into real estate and probably other projects.
 
Nobleone said:
Fiona Simmons, your mind has a warped angle of approach. :cool:
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Haha indeed, of course i would never suggest they implement that for real. But i was interested in the reactions because this topic catched my eye in real life.

The European Union seem to play with this idea. Today all banks that use the european central bank to store their money must pay negative interest. Some german banks have introduced negative interest for accounts holding over 3 million euro and being buissnes accounts from big companys last year.

If you combine this with the idea of abandoning hard cash, which is in some nordic countries almost reality, i find it scary how some goverments and finance experts are ticking.

In theory negative interest is a motivation to spend your money on pair with the inflation. The EZB wants the other banks to give out credits and invest in the markets to keep liquidity up. But if you combine no hard cash and negative interest you can oust private households and force them to spend money to keep the economy running.

it would also be hard to hide your money from the goverment or avoid taxes. It could make us to some kind of ant drones in a big ant hill. :eyecrazy: Just watching how rapid and radical our society changed in just 100 years i believe its possible we will drift in such a direction.
 
Would kill the game stone dead. That's why I wouldn't worry about it happening.

Which is not to say they couldn't implement something similar, such as avatars requiring or benefiting from being well fed, but that would also be so unpopular I think it'd be unlikely to happen.


Then again, what is being grown in those CLD plot gardens I wonder.....?
 
MA has better financial standing and acts in a more prudent manner than most RL governments and central banks, so I wouldn't worry about this. :cool:

(Forum rules prevent in-depth discussion of the above comparison but it would suffice to say that August 15, 1971 is still very far from happening.)
 
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Fiona Simmons said:
The European Union seem to play with this idea.
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You can't compare that EU with our EU, the former is a crumbling, badly managed beast torn by internal contradictions, while the latter is a thriving economy of the future :D If European Union introduced strongboxes, maybe it would have a chance..

Mega said:
Then again, what is being grown in those CLD plot gardens I wonder.....?
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Natural neurostims :smoke::cowboy::bandit:
 
Fiona Simmons said:
We all know that peds arn't backed up with real usd anymore and the gap between peds and usd is growing every year. What if mindark would introduce negative interest on inactive accounts or accounts that dosn't cycle any money on game mechanics ?

On real life negative interest is reality in some cases already as a tool to encourage investment and cashflow

To prevent becoming subject to negative interest you must cycle 20% of your total accounts tt value within 60 days else mindark remove 0.5% of your total accounts tt value each 30 days.

Probably the day mindark try to install this will the day they go bancrupt because everyone is withdrawing at the same time, so dont worry it wont happen it was only a thought play.
Click to expand...

i like this idea but lets make it 5% not .5%. and make it so that you have to cycle 20% of ur accounts value within 30 days, 60 seems too much.

only the whiny inactive "players", and most resellers will instantly say NO to this. but i think this game has survived worse implementations over the years. so to those who say this will kill the game have no idea what the grip of addition feels like unless they've torn themselves away for a bit.
 
sidxx said:
i like this idea but lets make it 5% not .5%. and make it so that you have to cycle 20% of ur accounts value within 30 days, 60 seems too much.

only the whiny inactive "players", and most resellers will instantly say NO to this. but i think this game has survived worse implementations over the years. so to those who say this will kill the game have no idea what the grip of addition feels like unless they've torn themselves away for a bit.
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New players would quit. Low activity players would sell out, then the mid level players would rush for the exit. A trickle would soon become a river.

No one would be buying on the auction, and the game would be dead in 6 months.

Same would probably happen if Entropia became a subscription game, the fact is isn't allows people to take breaks with no financial cost rather then sell out.
 
Mega said:
New players would quit. Low activity players would sell out, then the mid level players would rush for the exit. A trickle would soon become a river.

No one would be buying on the auction, and the game would be dead in 6 months.

Same would probably happen if Entropia became a subscription game, the fact is isn't allows people to take breaks with no financial cost rather then sell out.
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thats been said many times before and it never happened. besides new players own maybe 500 ped in total tt by the end of their first week playing if they depo, if no depo then that number is drastically lower. how hard can it be to cycle 10-100 ped a MONTH for a new player?

i myself am a midlevel player and i dont have more then 10k ped in tt. 2k cycled a month is unbelievably easy to cycle for a level 60+ player. i do that daily in less than 4 hours of grind time.

if 4 hours a MONTH was all it would take to prevent MA taking 5% of your stackables , i dont see that as an issue for 95% of the PLAYING playerbase.

you sir are far to dramatic
 
Konve said:
Sorry, what? :confused:
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My mistake

i should have written
There are more peds in game as mindark have dollars on their bank account to exchange them back. The gap between peds in the system and usd on their bank account is getting bigger over time. As bigger the gap as higher the chance by accident mindark can't serve the requested withdraw requests.

Ofc peds are still backed by dollars, they just dont have enough dollars to exchange all peds back that are cycling ingame. Thats no news at all i just wasn't careful enough to use the right words.

That brings me to a old news where mindark claimed we the player moved money around in the game that is simillar to the bip of a small country. Maybe we did ingame but how much of that was "fiat money" since the real usd value counterpart on mindarks account have never existed ? :scratch2:

Lets say mindark will face a situation where they on the edge of being bancrupt and give us the choice to get our deposits back from our last 6 months because they probably have some kind of insurance for this case that would pay them or the other option would be to make withdraws impossible for a year and introduce negative interest. What would we choose, a bancrupt mindark or a unsafe future ?

However its all just playing around with thoughts, i doubt anything like this will happen and its not desireable anything of this ever happen.
 
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im curious now, if MA were it silently implement this how many people would actually notice?
 
Mega said:
Same would probably happen if Entropia became a subscription game, the fact is isn't allows people to take breaks with no financial cost rather then sell out.
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I know that is a strong point of EU but lets take a look at the market. Different free to play mmo's that finance over a webshop have started to give their premium currency a limited life spawn to use it up after buying it.

I know at least 2 companys that run multiple f2p mmo's who introduced that. Their premium currency will become now invalid after one year after purchase if you not used it up. Another company is banning accounts that are one year inactive and give you the hassle to prove its your account to the support. It seem to be a trend in this direction.
 
Fiona Simmons said:
Another company is banning accounts that are one year inactive and give you the hassle to prove its your account to the support. It seem to be a trend in this direction.
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Maintaining an inactive account must cost virtually nothing, and dont let what banks say fool you.

My previous MMORPG, I bet I could login even though I've not checked on it for 5 years. Every company has a different policy on this. The companies that treat their customers well have thriving MMORPG's, and those that dont, have their games shut down.

Say what you like about MA, they have continued to improve and develop this game / universe, its a good location to park your virtual self (IMHO). :)
 
On topic: Negative interest on ingame assets would lead to one thing - mass withdrawals. Let's not go there.

Fiona Simmons said:
My mistake

i should have written
There are more peds in game as mindark have dollars on their bank account to exchange them back.
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To be sure. The magic word here is "anymore". By your wording there was a time when MA had more assets than there were PED in the game. Perhaps that was the case in their first year of accepting deposits, back in beta times. But the amount of PED in the game have not been backed by money in their bank account for the past 12 years.
 
Konve said:
To be sure. The magic word here is "anymore". By your wording there was a time when MA had more assets than there were PED in the game. Perhaps that was the case in their first year of accepting deposits, back in beta times. But the amount of PED in the game have not been backed by money in their bank account for the past 12 years.
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See also most countries in the world, and even banks have about 8% if everyone turned up for their money at the same time (rest is lent out with the hope of making more - in basic terms).

Depends how deep this discussion about "money" goes, but on a Friday night better to not worry about Greece and the impending Euro implosion and instead leave it to the economists & politicians to mess it up. Which they are doing spectacularly :shots:
 
Mega said:
See also most countries in the world, and even banks have about 8% if everyone turned up for their money at the same time (rest is lent out with the hope of making more - in basic terms).
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to note, all banks have assets to back their liabilities. maybe not be in cash or liqiud assets, but they are ~100% backing deposits on the balance sheet.
 
aridash said:
to note, all banks have assets to back their liabilities. maybe not be in cash or liqiud assets, but they are ~100% backing deposits on the balance sheet.
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That must be why the British taxpayer still owns a % of RBS and Lloyds 7 years on then?
 
aridash said:
to note, all banks have assets to back their liabilities. maybe not be in cash or liqiud assets, but they are ~100% backing deposits on the balance sheet.
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Yes, if you live in an islamic country where the full-reserve banking is commanded by sharia laws (although even there banks have the means to evade it). But in the Western world the fractional reserve is the basis of the banking system. The cash reserve ratio varies between countries, in average it's 5-10%, with as low as 1% in the European Union.

That's the whole reason why the 3rd party deposit insurance system exists, the luxury we don't have in Entropia.
 
Svarog said:
The cash reserve ratio varies between countries, in average it's 5-10%, with as low as 1% in the European Union.
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Basel II enfources europian banks to have at least 8% own assets to cover deposits, whats not necessary cash!
 
The most likely effect that would have is a mass withdrawal of assets, I'm sure MA would love a run on their cash reserves.

Even turning over 10% of my tt value would take too long for me to do with my current playing style.
 
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Svarog said:
Yes, if you live in an islamic country where the full-reserve banking is commanded by sharia laws (although even there banks have the means to evade it). But in the Western world the fractional reserve is the basis of the banking system. The cash reserve ratio varies between countries, in average it's 5-10%, with as low as 1% in the European Union.

That's the whole reason why the 3rd party deposit insurance system exists, the luxury we don't have in Entropia.
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this is confusion between cash and assets, not quite the same thing. fractional reserve banking allows the banks to multiply their balance sheet beyond the cash value of deposits, bonds etc (liabilities), by making loans (assets). they hold those assets to the value of all their liabilities. the trouble comes when some of those assets are revalued downwards and the balance sheet no longer balances... then the share holders, bond holder and ultimatly government has to pour in cash to plug the gap.

MA has never held assets, in cash or other forms, to the value of the liabilities. which was Konve's point really. a bank can liquidate over time to pay everyone back.

GoNi said:
Basel II enfources europian banks to have at least 8% own assets to cover deposits, whats not necessary cash!
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some of it can be sovereign debt, because thats safe and will never default. oh... oops :laugh:
 
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Svarog said:
Yes, if you live in an islamic country where the full-reserve banking is commanded by sharia laws (although even there banks have the means to evade it). But in the Western world the fractional reserve is the basis of the banking system. The cash reserve ratio varies between countries, in average it's 5-10%, with as low as 1% in the European Union.

That's the whole reason why the 3rd party deposit insurance system exists, the luxury we don't have in Entropia.
Click to expand...

People are mixing up cash reserves and assets. Of coerce a bank must have assets that covers all the deposits, the just don't have it all in cash. Bank's that don't have the deposits covered by assets will have to shut down. The problems is that sometimes in extreme crises, like in 2008 financial crises, some of the assets loose value so much and so fast that the banks can't cover all the liabilities.
 
I think the way to go is to focus on positive incentives for those who are active, like X perk if you have been active according to Y pattern/amount of time.

I feel that the original suggestion made here will have a severe negative impact on the game economy.

- Why should I deposit if I cant play "on my own time"?
- What if I plan on making a big investment: Landarea, weapon etc.
- Maybe you have been successful ingame and made a nice profit and made some investments and now getting the revenue from it. (play for free, withdraw for cash etc)

Keep the dream alive, don't kill it...there are many more examples I think, but these are some of the things people play for.
 
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