Implications Of The Bank Cap With Real-world Examples

Discussion in 'Ideas/Suggestions' started by BurnedExperiment, Aug 11, 2019.

  1. BurnedExperiment

    BurnedExperiment New Member

    Joined:
    Jul 9, 2019
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    Okay, so you might think from the title that this is going to be a long, dramatic bitch fit or an endless chain of doom-and-gloom what-if scenarios.

    This following entry will contain neither of the above.

    There has been a lot of constructive debate on the server regarding the recent change that set a cap on how much money you can hold in the server bank and set the interest rate at 1%. There have been a lot of ideas circulating on what the way forward should be from this point. Instead of putting this in chat form on the server or on discord, I thought I would share my thoughts and recommendations the way I know best, in the form of an editorial.

    What happened?

    "Interest is now 1% online with 0.5% offline | The max amount of money you can have in the bank is $10k for the time being. So if you're over the max, you cannot deposit anymore money into the bank."

    What are the short-term ramifications?

    If you're rich, you're super angry. If you're not, you're still angry that wealth inequality still exists but somewhat happy that someone stuck it to the rich.

    What were the long-term ramifications had nothing been done?

    "I'll give you 1.5 quadrillion mir for that stack of dirt blocks."

    What are the real issues behind this decision?

    1) devaluation of the server's currency

    2) Wealth inequality

    Whodunit?

    Doesn't matter.

    Why is wealth inequality an issue?

    If you run a list of the top 10 wealthiest people, you can get a pretty good idea of who's on top. You might want to do this yourself because i'm not going to implicate this individual of any wrongdoing; they have a reputation of generally being a decent, upstanding guy.

    However, the situation isn't so much who, but what can be done with it. It's the mere potential for abuse to occur that causes a lot of people to be skeptical to whether or not this change will actually work. After all, the rich stay rich and benefit only marginally less from gaming a system.

    What could come as a result of using wealth to abuse others? The what-if game could go for days. Many of us are fearful because of how this sort of situation would play out in real life.

    It's important to remember that this is still just a game. There are a pre-set list of parameters that this game must work within. You simply can't use your wealth to abuse anything beyond what the game can allow you to do.

    For instance, there is such a thing as a two-tier justice system in the United States. The rich get off with a sweetheart plea deal because they have a whole platoon of lawyers and the average person gets shafted for the same offense. By comparison, a person with one billion mir will get banned just the same as someone with one hundred mir if they break the servers' rules. This condition will continue insofar that in-game currency can't be exchanged for real money in some form or fashion.

    Therefore, no amount of mir in your account can excuse you from acting like a jerk. I say this jokingly, but being enough of a jerk might even cause the server admins to look the other way while others bomb out your town.

    What do we do about wealth inequality?

    There really isn't much we can do. The interest system just so happens to be something that was exploited to allow some to amass wealth. It wasn't cheating, hacking, and nor was it illegal in any form or fashion; this was just the way the plugins were designed.

    Hence, there will always be wealth inequality. Some have proposed an economic reset. While I won't say this is a bad idea, I respectfully decline not to support it.

    For starters, it will create a divide on this server that will cause a whole bunch of unneeded drama. It might even cause this community to go from tiny to absolutely microscopic.

    Even if everyone were to agree to it, someone else will wind up amassing all the wealth. Then someone else will call for another reset. The problem with this server (in addition to every other economic model in existence) is that people will find other ways to make money.

    If you tell some Wall Street investor that you're going to limit their ROI to only 1%, they'll sell their stocks and invest in another venture, possibly real estate or cryptocurrency. There is simply no economic model in existence, whether it be here or in real life, that can solve this issue in it's entirety.

    I did propose, at first, a max cap on the amount of currency you could carry at any given time--in the bank, on your person, in towns, or anywhere. I've revisited this and now conclude that this won't work either as it will create the exact same drama as the hard reset will. I conclude that the drama will be many orders of magnitude more detrimental than the wealth inequality question will ever become.

    But at least a hard cap goes further towards solving the next issue...

    What we do about currency devaluation?

    Since we can't solve the first issue, this is where we ought to be focusing our attention.

    While we have a simple supply and demand system in place, people will naturally begin to ask for more money for goods if someone knows what is in everyone else's wallet. If the amount of money in circulation increases, prices will increase as a consequence of inflation.

    Mind you, the price of starting a town and starting a nation will stay the same. These are incentives that the server (or plugin) offers in exchange for currency. they have the added benefit of taking currency out of circulation and controlling the rate of inflation.

    The recent changes that were implemented solves this partially by preventing more currency from going into circulation.

    My proposal is to create more things you could purchase within the server that would allow for an increasing degree of currency to be taken out of play.

    As of right now, there is a one nation, one town rule in play; thus, these prices should stay the same to ensure that new players can reach the threshold to build new towns and nations. However, other rights and privileges ought to be instituted based on the rate of inflation.

    For instance, you could offer "fly" permissions for 10,000 mir an hour. I say this as an example, but it at least provides an option and incentive for the "super rich" to contribute to improving the currency's standing.

    However, these options should only be offered in the short term in order to reduce the currency in circulation. Otherwise, I'll have to offer nine stacks of diamond blocks for one mir. Once it returns to a somewhat manageable rate, all you have to do is make sure the rate of money going into circulation (through interest and by voting) matches what is leaving through buying towns, nations, and tp's.
     
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