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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.

Hyper Inflation and v2

Day 960, 11:29 • Published in Canada Canada

• by Connor MacLeod

My fellow eCanadians.

This is a trying time and we need some decisive and quick action from the eCanadian government.

The new world has seen the minimum wage rise 6 fold through the migration (that's assuming the minimum wage is reduced to $1 CAD/hr). Companies will need to raise prices to compensate for this. Increase costs of production mean increased prices in the marketplace. Increased costs mean more gold gets turned into CAD.

The government must ensure the liquidity of the CAD or eCanada will quickly sink in the seas of v2. An overvalued CAD is as bad for the economy as an undervalued CAD.

Let's see where the leadership comes from.

Comments

Lincoln 6 Echo Day 960, 11:31

PENISMAXX

CrackerJacker Day 960, 12:23

"PENISMAXX"

Agreed.

Stephanos Primus Day 960, 15:51

New to "forumspeak". Have no idea what PENISMAXX means, but I'm guessing it's not complimentary. I just noticed another proposal to hike Income Tax to 11%, which so far has a sweeping favourable majority in Congress. I'm also hearing a lot of companies are closing down from having to deal with this new minimum wage. I have no idea if eEconomics works the same as in RL, but if it does, more than doubling income tax on less gross national income (because fewer companies are hiring) will slow spending. Major cutbacks on consumer spending coupled with a huge increase in unemployment may send the economy into a tailspin. This is not what most eEconomists (and maybe we don't have any?) would call a Stimulus Package. 🙂 In the governments defense, V2 is new to all of us. We need to give them a chance to understand it fully, and to adjust to the changes.

Frodo Tea Baggins Day 960, 16:06

I believe the proposal you're talking about Steph is on tanks which is a new industry, the gov't has never had a chance to set tax on it before, it was just at v2 inception default lvls.

Stephanos Primus Day 960, 16:15

Yup... my bad. I just noticed that myself actually, and was coming back here to amend my earlier comment.

Dade Pendwyn Day 960, 17:44

Companies are having to shut down because the min wage is too high. Unless admins change it to allow for a lower than 1 CAD min wage we're going to have to seriously deflate the value of our currency to compensate.

Duiveltje Day 961, 08:35

before they would earn around 1.5 cad/day. This is now 1 cad/ hour (8 hours = 1 normal work day). This implies that wages increased 433%. Now the question is how far does the peg have to drop.
Histroy peg 1 cad= 0.03, implying that in V1 minimum wage was 0.045G/day.
To keep the wage in terms of gold equal to before, the cad would have to drop to a peg rate of 0.005625.

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