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Daily Econ Report
Day 1,214 • March 18, 2011

In this edition:
1. Currency Snapshot
2. Marketplace Snapshots for High Volume Industries
3. Historical price trends
4. Today's Feature Article
5. Economic Community




Changes to the Daily Econ Report

You'll notice that with today's issue the Daily Econ Report I've made some significant changes to the format and orgainization along with some minor decorative changes. It is my hope that this helps my readers to better be able to digest the tl;dr content that I try to specialize in so very well.

There are new content additions as well - I've added eChina to my data tracking and will be presenting some more tables that include this data. This is intended to help ePH citizens and company owners to better gauge the international marketplace when putting items up for sale. Also there is a NEW section –- Historical Price Trends -- which contains an absolute asston of tables, charts and analysis regarding price movements in the ePH, eUSA and eChina.

Finally, towards the bottom of every article will be my "Features" where I will discuss topics of the day, important or interesting observations, advice, etc. At the very bottom of every article will be several links to other econ articles that could be useful to readers. I hope to provide access to a variety of topics, ideas and viewpoints and encourage readers around the world to send me their links when I shout for them.

Also, all tables & charts are clickable for larger versions if you have trouble seeing them in the article.

I hope you enjoy the changes and additions. On to the Report!




Daily Economic Snapshots



Good news for company owners as the lazy among us will enjoy doing rough conversions on price due to the
Marketplace Snapshots for High Volume Industries



Prices are starting to come back inline with those offered in the eUSA. Food is most notable in this regard. Prices remain higher in the ePH relative to those in the eUSA



A new addition - CHINA! I decided to add China to the mix to reduce my personal cultural bias in trading. I'm a former eUSA citizen, sure, but that doesn't mean that everyone in the ePH trades with the eUSA. I've had several ePH citizens suggest that we peg our currency to the CNY as opposed to my suggestion of pegging it to the USD, so here I am, trying to make everyone happy. You're welcome, bitches.

Note that ePH prices for Iron & Q5 food are MUCH lower than those found in China. A sign of our competitiveness? Perhaps. I'll chalk it up to a more likely inattention to world markets by Chinese business owners though.



I thought that a composite comparison (i.e., average, not weighted) might help some people when deciding where to price goods for sale or if that price in the ePH is actually good or not. It's crude but gives us an idea of where we stand, roughly, in comparison to two larger & faster markets. Be aware that simple averages are prone to skewing by outliers. Since there are only TWO countries currently in this composite any dramatic shifts in their markets will be reflected here as well.




Historical Trends & Analysis

I am going to kick off this section with Raw Materials. Every Friday will include the week's data with a fantastic, well-designed chart to help illustrate the week's price movements in Raw Materials between the ePH, eUSA and eChina. Unfortunately for you suckers, I just started tracking eCH prices last night so I only have one data point for them across the four segments in the Raw Materials category. Lump it.

Here's the schedule for historical trends:
Mondays -- Food
Tuesdays -- Houses
Wednesdays -- Weapons
Thurdays -- Moving Tickets
Fridays -- Raw Materials

Past 7 Days Iron - ePH, eUSA, eCH in gold


There was a noted bump in yesterday's iron prices in both the eUSA and ePH, due to the mass freakout over the potential for RM scarcity. That didn't turn out to be the case, so prices quickly reached equilibrium overnight. Long term trem is downward.

Past 7 Days Grain - ePH, eUSA, eCH in gold


I'm going to be a broken record with these charts but the story isn't different - long term declines in price coupled with yesterday's price spike. Smaller markets are more susceptible to extreme volatility which explains why the ePH experienced a larger price jump than the eUSA yesterday.

Past 7 Days Oil - ePH, eUSA, eCH in gold


Here's an interesting chart - the demand for Oil is highly ineslastic and low in comparison to grain and iron. This chart shows a remarkedly stable price point up until today where prices dropped by more than 50%. Note the price spike in the eUSA yesterday, an indicator of stronger demand there. Demand for Oil in the ePH is very low, hence the lack of an impact on yesterday's prices there by the scarcity scare.

Past 7 Days Stone - ePH, eUSA, eCH in gold


Stone is an interesting market in that it remains closed to new entrants and demand varies greatly by market. I can tell you from personal experience that there are currently no housing, hospital or defense system manufacturers in the ePH. I am more interested in this chart for the interaction between the eUSA and eChina. Note yesterday's jump in the eUSA but not in the ePH - an obvious sign of no demand in the ePH.




Today's Feature - Yet Another Econ Module Change

Yesterday some dramatic changes were implemented to the Economic Module - per unit manufacturing at all quality levels were made equal in manufacturing companies. This means that the amount of units produced remains the same regardless of the level of the company. I'll use myself as an example - I produce 105 units of food at my Q5 food companies as well as my Q1 food company. This is a huge benefit to owners of higher-quality level companies as there is now some serious efficiency in advanced products as compared to commodity-level products. However, this change was met with a mass freakout as everyone realized what this would do to Raw Material consumption. Hoarding and price increases were observed throughout eRepublik.

Until today's change was announced later in the day. Today Raw Materials production was doubled for everyone. This means that one shift's output at my grain companies now matches one shift's need for food production at my Q1 food companies. The resulting relationship between Raw Materials and Manufacturing is now much, much simpler. We'll assume that the production by a worker/owner on the left is equal to the production of a worker/owner on the right (in production points).

Q1 manufacturing RM needs == 1 RM company output
Q2 manufacturing RM needs == 2 RM companies' output
Q3 manufacturing RM needs == 3 RM companies' output
Q4 manufacturing RM needs == 4 RM companies' output
Q5 manufacturing RM needs == 5 RM companies' output

This is great news as the previous balance between RM consumption and supply is maintained. The downside to this change is that the previous balance between RM consumption and supply was not in balance and led to oversupply in RMs and a long-term price decline. Today's change will not stop that trend or change the market fundamental in any way.

Potential Impacts

1. Self-sufficiency has changed. It is lowered to two grain companies and two Q1 food companies OR two grain companies and one Q2 food company.

2. Some manufacturers with many Q5 industries may face RM shortages if attempting to run production daily. Again, using myself as an example, I can produce 210 Q5 food per day if I wanted. That's 2,100 health, or one-week's worth of 300 health per day at the max consumption. Of course running this production on daily basis would necessitate having access to the output of ten grain companies. Daily. 105 Q5 Food needs 30 grain per unit to make, so that's 3,050 grain per, or 6,100 grain daily. Not an insignificant amount.

3. Owners of high-Q food companies can now work less per week to make the same health they did before. This will have benefits in other product output or conversion of those work shifts to fighting shifts, thus creating higher personal and aggregate damage on the battlefield.

My advice: be sane, folks, lest you kill your now tidy profits by being too greedy. Case in point: I can produce 30 Q5 weapons per day by working at my three Q5 weapons companies but I'm not going to do that. I will work TWICE per week, use most of the guns and sell the little surplus, keeping things exactly the same as before.




Economic Community

IRC Economics Channel

There was mass enthusaism for the IRC #eEcon channel yesterday, at least by the dozen or so new members that stopped by for a discussion of the recent changes. This channel is your permanent home on IRC for exploring all things economics in eRepublik, from Monetary Markets/Exchanges to Company Ownership, Export Licenses to Bartering, the channel will be what we, as a community of "economists" make of it. Come join the conversation or just lurk. You never know what discussion will be taking place.

Articles Worth Reading

Every morning around 6:00 Server Time I will be shouting a couple of times for submissions to this section. You can either list your articles in reply to my shout, contact me in IRC about a hot article you would like me to link or send me a message in game. I will gladly take submissions and kindly ask that you link my articles in return or shout them. Thanks for your links and let's work together to build a world-wide economist's community.

Thedillpickl's Pickle Barrel
The Econ Mod, What I'm Seeing

Graf Sprat's eIndia-Today
- submitted by maverick10 Dodge Knight - THANK YOU FOR THIS!
Cheaper Weapons. How Cheap?

Gnilrap's 16 Shells
This article is in the works so I'm linking to his paper, not a specific article.

Give these folks a read and if you think it's worthy, your vote.

Stay dirty, piglets.




Small But Mighty

The ePhilippines can never match the total damage of a large country like the eUSA but rather can exceed her in per capita damage. It's like being Manny Pacquiao to the eUSA's Muhammad Ali. Both kick ass. But Manny Pacquiao is this generation's BAMF. Let's make the ePhilippines this eRep generation's BAMF.