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Alex
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Loan payments are fairly flexible in the game. They are usually suspended and/or expanded during wars or raids. Sometimes people agree to pay with resourses instead of cash or prefer to pay off a loan in advance rather than pay minimum payments for god knows how long. 

 

Interest is also based on risk, by mechanically enforceing repayment it could basically lead to people offering the lowest mechanically allowable interest rates since a. It's guarrenteed income and b. If they don't pay out it would be due to them going inactive/ quiting the game which they would have done anyways. 

 

The biggest thing is that loans tend to be for larger city purchases that alliances don't buy for their members, at that level, the repayment periods can be so long that wars can be fought and cause major problems with repayment. If there is a way to cancel the loan repayments It is almost guaranteed people would just click it either before the war breaks out or during, forcing people to have to actually interact to negotiate the rest of the payments, completely defeating the point.

 

Also, the insurance guarantee is so obviously abusable that I'm not even going to bother spelling it out.

Edited by Malal
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On 1/4/2016 at 6:37 PM, Sheepy said:
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Interesting idea... especially the defaulter thing.

  • The loan should not be "spendable". No money, resources, credits. Just cities and infra. Or Projects. Will prevent cheating.
  • If I give out loan for  $3,375,000 (#3,#4,#5).. then according to the insurance I'll get back 80% of my money back if the borrower goes inactive, etc. This can attract people to take a risk.. as the investment might return 120% or 80%.

@MalalThis game has gone from bad to worse for non-aligned new members. Wanna play this game? Better join a grant alliance. Alex might wanna improve that. What if someone does not want an alliance. He should be able to grow. Loans.. may not be the only way.. but at-least Alex is coming up with ideas. :P 

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32 minutes ago, WarGamer said:

 

@MalalThis game has gone from bad to worse for non-aligned new members. Wanna play this game? Better join a grant alliance. Alex might wanna improve that. What if someone does not want an alliance. He should be able to grow. Loans.. may not be the only way.. but at-least Alex is coming up with ideas. :P 

In order to play this game you do need to join an alliance. The tutorial, while helpful, isn't very good and alliances actually teach people how to play. Besides, as a nation sim half the game is interacting with other people and the only two realistic options are joining an alliance or creating one and the success of the latter option is nearly non-existent for noobs.

Edited by Malal
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Orbis Wars   |   CSI: UPN   |   B I G O O F   |   PW Expert Has Nerve To Tell You How To Run Your Own Goddamn Alliance | Occupy Wall Street | Sheepy Sings

TheNG - My favorite part is when Steve suggests DEIC might have done something remotely successful, then gets massively shit on for proposing such a stupid idea.

On 1/4/2016 at 6:37 PM, Sheepy said:
Sheepy said:

I'm retarded, you win

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Speaking on behalf of my recent in game company take-over. 

 

Micro Bank is a new bank on the block and caters to smaller loans. So this is deeply loved and totally agree with this form to it's loans. 

 

I say Aye! 

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This is an interesting idea.  As mentioned above, alliances generally do well by their n00bs, but this does offer a nonaligned player an opportunity to grow while learning the game mechanics.  And a small banking system has evolved on the open market, but this idea places it into the game mechanics and offers an additional channel for risk tolerant nations to invest.  As for loan guarantees, it seems to me an unnecessary layer, at least at the outset.  

 

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I think Alex nailed it with this idea.

lately, private banks have been suffering from various cases of defaults and the insurance option would provide for a good solution to that, allowing the investor to choose to take the risk or not.

by making this a non monopolized system, meaning each player can on its own and advertise their loans, it invites everyone to make their own little bank and adds diversity to the idea. It also simplifies a bank manager's job by automating the entire repayment process.

This loans are optional obviously, non compulsory, it gives another tool for players should they choose to use them, so I don't see why this is a negative thing, it just adds an extra layer of opportunities for all players to interact with eachother and strategize how to best grow your nation.

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1 hour ago, Sweeeeet Ronny D said:

Can we make this mafia style if they cant pay back their loans, which means that the lender can destroy a set amount of infra/land/improvements every week they don't get paid back, and then exponentially increase the interest on top of it?

lol

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Well. I'd generally say that implementing a system for something that players can already do themselves (and which is going to end up more rigid than whatever terms players may want to negotiate between themselves, to boot), is kinda just a waste of dev time compared to new features or ease-of-use upgrades that can help everyone.

The novel part of the idea is admin insuring loans to smaller nations. Which sounds like, basically, a way admin is helping whales make even more money from "helping" smaller players. So I don't like that idea, particularly.

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I think this system will server to benefit unaligned players and smaller AAs as well. This means that if you are in a micro alliance that doesn't have the fund to build you up past say city 5, you still have an opportunity to grow. Private banks should still be allowed to operate outside of this system as many managers enjoy the running process, this is an addition to the existing choices which will be a great benefit to, and help maintain, small nation growth and interest in the game.

It should be possible for this system to encompass Alliances as well, taking a predetermined amount out of their turn-ly tax revenues to pay for the loans. This will be useful for both small and large alliances alike that need funs.

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I like the idea of expanding the market to loans and thus create competition in this sphere as well. I suppose, the concept of insurance, tieing a particular insurance contract to a particular loan, cannot be handled by the market, right?

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Seems like a fair idea. This already exists by and large for the mid tier players, but no one loans out to new players without any reputation so essentially banks only loan out to people with good reputation. This way, new players will also be able to benefit from the loans. 

The default insurance part needs to be worked out a bit to make sure there is no abuse of the system. 

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I still have about another week before becoming reactive since taking a break for the holidays up to Valentine's Day, but I'll pitch in my two cents here.

Yes, a mechanic system helps so people don't have to jimmy the trade market with 1 food trades to make regular payments.  It also serves as a regular reminder that payments are due.  I also don't see how insurance is abusive although there should be a separate insurance market or preferably a credit default swap market with an exchange of cash flows - the insurer sends cash to the lender on a regular basis, and the borrower actually pays its payments to the insurer.  If the borrower defaults, the insurer still sends payments to the lender for the contracted time period.

However, this is a social political game.  Making payments automatic circumvents social politics.  It disables people from saying, "Eh... I don't want to pay up," and creating the associated drama.  This is especially true in the international sense.  We have to remember that we're not talking about personal commercial banking here.  We're talking about nationstates wielding clout.

What should actually exist is a bounty-hunting mechanic.  Lenders and borrowers would agree upon a forgiveness period before a bounty can be assigned.  For example, 3 days.  Within that time period, the borrower can make payments.  Once the clock runs out, however, the lender can post the loan on a bounty-hunting market.  The clock would reset everytime a payment is made as well.

Bounties would be organized in two ways:

One, the lender could simply pay the bounty-hunter to attack the borrower.  The mission could require a certain amount of damage to be inflicted, or a certain amount of funds to be extracted and returned to the lender.  The lender could also insure the bounty-hunter up to a certain amount to afford their own damages.

Two, the lender could sell the loan to the bounty-hunter for a percentage of its original value. For example, 75%. Loan payments would be made to the bounty-hunter, and the bounty-hunter would be allowed to declare war on the borrower.

Bounty wars would qualify as their own type, and would inflict more casualties as well as extract more loot.  Furthermore, any bounty-hunter enforcing a bounty would get a significant defensive advantage if counter-declared upon by someone in the target's alliance or the alliance's allies. 

Edited by Dubayoo
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3 hours ago, Malal said:

Loan payments are fairly flexible in the game. They are usually suspended and/or expanded during wars or raids. Sometimes people agree to pay with resourses instead of cash or prefer to pay off a loan in advance rather than pay minimum payments for god knows how long. 

 

Interest is also based on risk, by mechanically enforceing repayment it could basically lead to people offering the lowest mechanically allowable interest rates since a. It's guarrenteed income and b. If they don't pay out it would be due to them going inactive/ quiting the game which they would have done anyways. 

 

The biggest thing is that loans tend to be for larger city purchases that alliances don't buy for their members, at that level, the repayment periods can be so long that wars can be fought and cause major problems with repayment. If there is a way to cancel the loan repayments It is almost guaranteed people would just click it either before the war breaks out or during, forcing people to have to actually interact to negotiate the rest of the payments, completely defeating the point.

 

Also, the insurance guarantee is so obviously abusable that I'm not even going to bother spelling it out.

I'm not really sure what you mean by mechanically allowable interest rates.

You'd just type a number into a box.  Maybe the box would only go up to 3 decimal places, but still, it's not like people are going to ask for .001% interest.  There's no value in that.  

Loans are also used often to rebuild after a war is over since there's more income to be made by purchasing cheaper cities and infrastructure than more expensive cities an infrastructure.  The lender's profit comes from the difference in cost compared to buying cities and infrastructure oneself, and the borrower's profit comes from not having to wait for income to normally come in before rebuilding.

The only way insurance seems abusive is if it's a complete package.  For a simple example, say a $10m loan is issued with $1m in principal being repaid per week.  The lender should only buy insurance for the remaining principal, not all of the principal including what's already paid.  If 5 weeks have passed, then only $5m would be insured, not $10m.  If the borrower defaults at that point, the lender shouldn't get more than the originally lent principal such as $5m already repaid plus $10m originally insured.

Of course, if there's a private insurance (or credit default swap) market, this wouldn't be a problem anyway. Insurers wouldn't be dumb enough to insure the entirety of the loan while part of it is paid off.

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It's a nice idea. If the insurance rate was set at 3-5% of the debt, it would mean that banks would increase the interest rate to pay the insurance, and other banks would offer lower rates to highly trusted people who they don't believe will default. It'd create some form of competition and incentivise risk

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12 hours ago, Malal said:

In order to play this game you do need to join an alliance. The tutorial, while helpful, isn't very good and alliances actually teach people how to play. Besides, as a nation sim half the game is interacting with other people and the only two realistic options are joining an alliance or creating one and the success of the latter option is nearly non-existent for noobs.

Ideally one should not need to join an existing alliance. Otherwise no new sides can possibly form; just reshuffled old players with the same friendships and grudges doing the same exact things over and over.

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32 minutes ago, Sir Scarfalot said:

Ideally one should not need to join an existing alliance. Otherwise no new sides can possibly form; just reshuffled old players with the same friendships and grudges doing the same exact things over and over.

New players, by and large, need to join established communities to get involved in the metagame. If they want to make something new afterwards, that should be encouraged - I agree. But throwing people to the sharks is asking to lose newbies in droves.

 

I don't like any idea that removes something that is covered by the meta. This would be a downvote for me.

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The only thing this adds to the game is a way to force players to pay back loans and potentially to guarantee that lenders get paid for loaning money. Everything else already exists: players have created their own banks; alliances regularly distribute aid and loans to their own members; and whales have IC, non-hard-coded means of recouping past losses and mitigating futures ones. Please, can someone explain to me why risking greater inflation and putting a damper on the prolific IC innovation that characterizes this game is desirable?

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This doesn't sound like a very good idea for someone taking a loan. Additionally, insurance for loans sounds like a terrible game mechanic with a lot of scope for abuse. People could start creating new nations, applying for loans for cities and infra, start warring and then once their nation is exhausted, abandon the game. And then start again.

The people giving the loan don't suffer at all.

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I think this is a great idea. Instead of making a subforum where people can request loans, it should be done ingame in the trading section. Nations can sell bonds of a particular interest rate (price) in order to raise money, and lenders with cash can buy them, and also resell those bonds on the same market. This would allow multiple nations to contribute to funding and creditors would be able to get their money back immediately by reselling the bonds, or nations who want to make lump sum payment on their loan could buy back the bonds they issued, or bonds from other nations. Nations can create 1 bond at a cost of $1000 per turn for n turns, and each turn the holder of the bond gets the money paid from the issuer, and the value of the bond remaining decreases. The value will be calculated by the revenue per turn * remaining turns. On the market, the remaining bond value and turns remaining will be shown, as well as the interest rate. For example, someone who wants a loan of $1m repaid over 30 days would issue 3 bonds @ 360 turns (3 * 1000 * 360 = 1080000) then sell them on the market for a total of $1m, or 333,333 each. This represents an interest rate of 8% over 30 days. The monthly interest rate used for sorting the trade price could be (((revenue per turn * remaining turns / offer given) - 1)*360/remaining turns)*100. If someone else puts an offer of 3 bonds (360 turns) for 990k (330k per bond), this would be a lower price and represent a higher interest rate of 9.09%. Say someone has bonds with only 300 turns remaining, each one is now only worth 300k so to get an equivalent interest rate of 8% per month, the bonds could be sold for 281.25k each. To prevent abuse by new players this system could also work by ensuring that upon the initial sale of the bonds, funds immediately go towards the player's next city/project/infrastructure/land payment, instead of receiving cash.

As for nations who can't make the payments, there should be a display on each nation page to show how many bonds they have outstanding and a check to make sure they can't issue more bonds than they can pay back. If a nation defaults, the bond holder will lose their money and the issuer could be given a bad credit rating. Nations could get a good credit rating for making repayments over time and also based on the percentage of their income that is going towards repayments.

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