[Finance] Financial crisis part 2
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by Ministerie van Economische Zak
Dear Citizens,
In the previous part i spoke about some possible solutions and that we as a government would decide which step we take. We have recently done so, and i hereby present our way of action.
We decided to "buy" gold as government, and repay you with NLG in a form of a savings account with a fixed interest.
You can sell your gold at a rate of 1 gold = 65 NLG. We then put this NLG aside for you, and add 5% every month for 3 months. This will make 75.25 NLG per gold at the end of the 3 months. With a exchange rate of 0.016 that would come to ~1.2 gold
We decided to choose this form since there is to much NLG for sale, by using this form, we can have gold on the MM, without the equivalent in NLG for sale as that is currently troubeling our MM. We hope that in this way we reduce the amount of NLG for sale, and increase the amount of gold for sale.
Sounds good making 20% profit in 3 months, how do i join?
Just send a PM to this org, Ministerie of Economische Zak, in which you tell us your citizen name, if you use an org, please also state your citizen's name, and the amount of gold you wish to put in.
This first round of bonds will be limited to 75 gold of bonds, if there is more gold enlisted we will stop at 75 and inform the people that came after 75 first about a possible second round.
We reserve the right to exclude people from participation without giving a reason.
Ministry of Finance,
Luuklag
ps. An other way you can help is by donating money that you dont need to the state (DNB or the ingame treasury)
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Good action from the government!
I think this is a great idea, more efficient form of state bonds 🙂
Good idea indeed, but it sound like more private bonds than state bonds, even if it's state money...
I'm doubtfull about this statement : "We reserve the right to exclude people from participation without giving a reason."
Is it possible to get more informations ?
Thanks 🙂
@ ThomasRed; It are state bonds since the state gives them out and guarantees that they are payed.
About the excluding part, Well just to prevent foreigners, EDEN members etc. from making profit on our state buisnesses.
Hope it works, good luck 😉
Very nice, hope it works! Already voted!
Ah, and by the way, I'm quite amused on how this is a complex game 😮..
@frans if you like complexity, then you are in for a treat! 😛
So you are going to pay out NLG in a few months, making a loss as government? And how will that effect the NLG rate at that time?
You might save the market a bit now by getting more GOLD, but you'll end up paying later because:
- the GOLD has been spend or exchanged at the market by then
- you have to bring a lot of NLG on the market, endangering the rate in the future
- this is a temporary solution (getting money quick) for a structural problem (spending too much). It will only worsen the economical situation.
This is short-term management!
This has not been brought up in congress. I would have liked to debate on this and weigh or at least share the advantages and disadvantages.
For the moment, I think this will NOT benefit the eUNL and its finances. I hope I'm not MoF at the time the effects of this will be felt!
PS: But I'm happy to see that the Ministry is actively seeking solutions and ways to counter the crisis, of course 😉
wat wil je tegen houden de inflatie is al meer als 2 maanden -20%,,,
@ Boklevski
Long term solutions just cant do without short term solutions. We are working on ways to cut the costs or our government, but these effects wont be felt tomorrow, it will take some time. The current problem is that there is to much NLG on the market, the only solution is to get them off.
The government currently lacks the gold to buy these NLG, i still remember printing NLG in a period of shortage, making gold profit on that, but forgetting to keep the gold as a reserve to buy back the printed NLG one day....
The current seperation of our union in two monetary nations doesnt help as well, this means a lot of people want BEF and dont want their NLG anymore, making the surplus of NLG only bigger.
If we manage to remove a lot of NLG from the market now, we have 3 months time to further reduce the governmental spendings untill we spend less then we recieve, which would be the ideal situation as that means that we activly need to sell NLG to keep our currency stable, which is a lot easier the selling gold.
A different way of reducing the NLG in the free market would be a drastic increase of income tax and VAT, but our citizens are hurt hard enaugh by the decreasing wages of the last week. I simply dont thik that we should hurt them any harder.
@ Luuklag
I fully agree on the reasons that caused the current situation. I also agree that we need to reduce costs.
However, with this method, every gold that we buy now, will cost the state "~1.2 gold" later (as stated in the article). This creates a big liability.
This implies, that we need to reduce costs even further.
In fact, as individual it sounds interesting. I'm actually thinking of buying GOLD with all the NLG I've got, invest that GOLD in the government's proposal, and get a quite nice interest on it. Ofcourse, that would not help the state (I'm putting my NLG on the market now, and it costs the state more later), but it will help me.
[PS: I'm not really going to do that, as I want to help eUNL, but it would be a rational thought.]
@boklevski
If the profit is to low, no one will participate.
But im running out of options, the only things that i think could help our MM would be increasing the taxes, or devaluating our currency. But i dont like these options, and nor does anyone else.
If our currency devaluated we would become even cheaper labourers, this could then increase our export position to take in the gold we need to stabelize and keep taxes at the same rate.
I made a spreadsheet with the totals of all financial reports i could find, and also included the difference between two following reports, you can see it: http://spreadsheets.google.com/ccc?key=0AiFwWLQJGKKDdDVQclF5YnB5dE1HMzlDY0ZHNnV2eVE&hl=en" target="_blank">http://spreadsheets.google.com/ccc?key=0[..]hl=en
"But im running out of options, (...)"
Okay, I have to agree there... can't think of anything else too, actually...
And +1 for the next step in transparancy!
Maybe you can add in the overview the "total" in-/decrease in GOLD? ( = ChangeNLG * 0,016 + ChangeGOLD )
Looks good (the overview that is), Finances look somewhat less convincing (-1,200 balance in GOLD overall; only 4 periods out of 12 positive balance).
Maybe put a link to this on the forum or a new article/next weekly report? 🙂
Hmm good you say, i forgot to put it on the forum as well, i will do. Well i know they dont look convincing, but these are the facts. I guess it might be interesting to add special events with dates, such as upgrading UNL-weapons, attacks on belgian regions etc. But i dont got the time for that.
Discussion moved to: http://enetherlands.nl/viewtopic.php?f=101&t=4677&p=52686#p52686" target="_blank">http://enetherlands.nl/viewtopic.php?f=1[..]2686
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