ahava3233 reporting once again as a private citizen. This time on monetary matters.
A hot air balloon deflating; this is how your gold feels right now I bet.
So the trends in the visible monetary market have been a bit unsettling for the past couple of days. The gold price, which has been static at about 338 CC(￥)/Gold for a couple of weeks now has just begun to plummet and deflate. I can't say exactly when it started, but I know it had to have been in the past few days (probably the last 3, correct me if I'm wrong) or so, and as you can see in this screenshot taken on Day 1,891 at 13:44 Erepublik Standard Time (PST/UTC-８), the current gold price now is about ￥278.5/Gold.
Click to see the current gold prices on the market
With this in mind, we have already seen business owners throughout the country start to react; prices of goods in the domestic market are falling due to the increased value of currency (you can buy Q7 weapons for less than ￥10 now), and even our own Minister of Labor had to decrease wages for our younger/less wealthy players to ￥16-20 from ￥30.
Otherwise, I'd wager the following predictions for the market based on what I've seen so far.
Economic fortune telling for you
1. In the short term, gold prices will dip to about ￥250-260 and stay there for a period of time. This is due to the fact that posted sales of currency on the market right now for .004 gold/￥ (￥250/Gold) that don't require active prompting from gold sellers should offset further decrease in the gold price until there is no more currency on the market for that price.
2. Although there will be minor ups and downs along the way, gold prices will continue to drop for the forseeable future, especially if the admins continue to keep bots inactive. This is due to the fact that bots are currently the only way money is printed without loss in this game, and currency will become more scarce as people hoard it or it is lost in inactive/banned accounts as it cannot be printed directly by players. Governments can actually print money and doing so will become profitable once the gold price reaches ￥200/Gold (￥.005/Gold), but there is however no method of putting gold into the treasury to do this at the present time (direct donation is impossible and there are no taxes levied on gold either). Thus this mechanic will not stop the gold price from continuing to drop, it will only stall it until governments run out of stored resources to print money, just like the posted currency offers.
So, some last words and financial advice...
Listen to me, I have a math degree (I really do irl xD)
Private citizens can easily profit from this trend by holding and saving ALL of their funds in currency, not gold, only exchanging their funds for gold when needed to complete transactions. Furthermore, given the spiraling trends you may be able to profit even more if you put your funds in the hands of a trustworthy investment firm/stockbroker (that takes advantage of daily trends in the market), albeit at a risk to your funds.
Currency spending and higher wages despite the deflation in this economy is the best way to keep our local economy running more smoothly than other countries. Natsumee alluded to this in his most recent article. Spending is the best way to keep deflation down in a specific market, such as our own.
Furthermore, this trend can be avoided by taking part in a workers' commune, which bypasses the market altogether.
Thus, I leave you all at that, ahava signing off. Comment, subscribe to Gougai and vote up!
What is this?You are reading an article written by a citizen of eRepublik, an immersive multiplayer strategy game based on real life countries. Create your own character and help your country achieve its glory while establishing yourself as a war hero, renowned publisher or finance guru.