Posted - 2005.10.18 14:50:00 - [3]

 

Yep, valuation is the sticking point. You could use gross sales as a benchmark, for the industrial corporation...but for stocks?

A bond market I could see, but it would take a player driven ratings group and even then there would be a lightening quick oligoploy I'm afraid as economy of scale is one of the only real wealth producers in the game. There are no "breakthroughs" really in the game, and things like the bookmark market are few and far between...and without that sort of volatility it seems like numbers will trump all for a good while.

Use eve-search to browse through the propositions that have come up on the market channel...come up with a system for valuation, that would go a long way.

Posted - 2005.10.18 15:40:00 - [5]

 

I think an Eve stock market could be great fun. Just like in real life, it doesn't matter what the actual 'value' of the company is... what only matters is what other players think its value is. The share itself becomes a representation of the perception of a corporation's value. Players will have to get their own idea of a corporations value from its activities and holdings. If a player knows a certain corp has t2 bpo's, then that player will adjust their own perception of the corp's value in their own mind. There is a lot of potential for adding enough complexity to make it fun. Like Zuper says, let's leave out the real life ickiness...

Wurm

Posted - 2005.10.19 01:47:00 - [7]

 

Not sure about the whole stock market thing, but this brings up something I've been wondering about...

It says "wealth" next to my character when I log in, however that's really just his cash. I have no clue how wealthy he really is with ships, components, raw materials, etc scattered all over the universe.

Perhaps it would make sense to start with a "wealth query" tool that would scan through his assets and assign the 20-day market average to each of his items and return a real net worth.

If it worked, you could apply it to corps and then you could publish a real net worth of all their assets (updated every day with the server maintenence), their cash on hand, and cash flow for the trailing day, week or month. This would probably make a stock market in eve possible.

Posted - 2005.10.19 06:12:00 - [9]

 

id like to see more of those types of resources allocated to NPC goods and enhancing the market prices in terms of dynamic supply and output and demand - planetary interactions will go with this. Perhaps planets could be traded and a stockmarket in that way could be operated

Posted - 2005.10.19 07:27:00 - [11]

 

For those worried about accurate valuation:

There is no such thing in real life.

That's what lets people be speculative about stocks, otherwise it's just buy, hold, cash dividend checks (which sounds like those who worry about valuation plan to do)

Why are you worried that there are no "database prices" for T2 BPOs? Or that you won't know every single asset of the corp?

1) Intellectual property, brand name recognition, market share, management competence. These are some things that affect how profitable (and how valuable) a corporation is. You can't put a "solid" price on that. Though they may have cost time and money to acquire, you can only make educated guesses at how much they will make for a corp.

2) In my opinion, you can consider BPOs as intellectual property for valuation. It's not holding a patent exclusively, of course, more like licensing the rights from the game universe. They allow you to manufacture something and make a profit from it. How can you find the "exact" value of that?

3) I know you are worried that you can't just look up a "base price" or "mineral price" and go from there. It just can't be that simple. Those would just be the minimum a company would be able to sell the asset for. If the corp was being run well, the whole operation would be valued a lot more than the sum of its assets.

4) I also realize that you can't know all the true assets of the corp. Some will be held by individual members and not shown in the hangars or other sections of whatever is being disclosed. A good CEO should disclose such assets with evidence to back him up -- if he doesn't or he can't, that might make his stock undervalued. That would be good for perceptive speculators: the company could make more money than expected because it uses assets that were undisclosed (whether on purpose or missed by accident).

That will definitely lead to insider trading if assets are not disclosed on purpose, especially because we don't and won't ever have an SEC (or FBI for that matter).

Scammers could lie about their assets too, but people aren't stupid. I imagine that if there's too much that is claimed and not verifiable, the market won't value the stock very high. If it's just a luckless, but truthful CEO, the joke is on the people valuing his stock real low if the guy is able to make an enormous amount of unexpected profit.

If a CEO screws his shareholders by scamming and insider trading, he risks a chance of not being trusted again, like in real life. Sucks for the shareholders, but at least he can only do that once... However, unlike in real life, he also runs the risk of being hunted down and murdered, podded, amd robbed (repeatedly).

I hope I have allayed any fears/doubts about an EVE stock market. I notice that I haven't even mentioned research tools or IPO underwriting in my post! (Sorry), I will get to that if people still show interest in this idea a couple of days from now.

Whew. That was a mouthful (handful?). I even wrote most of that at work ;)

Posted - 2005.10.20 03:24:00 - [13]

 

Edited by: Pwyle Kenobi on 20/10/2005 05:11:28
EDIT: To correct typos.

This is not criticism directed at the original poster or anyone else. In fact, having a fully functional stock market in Eve is a very interesting and compelling idea. However, I see some problems associated with it.

Originally by: Zuper Phrend

---

For those worried about accurate valuation:

There is no such thing in real life.

---

That is true to a point (you may get a wry look from your in-house company analysts who strive to achieve accurate valuations for your investor clients).

While accurate valuations are difficult to achieve, that is what we all strive for in LR. It is why we have layer upon layer upon layer of continuous disclosure rules, transaction procedure rules, watch-dog bodies, judicial bodies, etc, etc. In fact, that's also why we have the "false market rules" obliging companies and their boards to release information and announcements to attempt to correct market anomalies created by inaccurate information and faulty valuations and market assessments. Yes, there is still room to speculate but it is speculation on an informed basis. All stock markets operate on the principle of "an efficient, fair and well-informed market". This can only be achieved with multiple layers of safe-guards and, ultimately, someone holding a very big stick.

As you'd know, company disclosures to the market concern much more than just a statement of assets and liabilities. What a board proposes to do, and what it is doing, with its resources is just as important.

Would you propose that there be a continuous disclosure regime in Eve (to attempt to create "an efficient, fair and well-informed market")? For example, disclosure of war declarations, the entry into new markets and the appointment of new directors and their respective experience. Would you have exclusions from the continuous disclosure obligations? For example, confidential and incomplete negotiations in process. At what point does a new war tactic become disclosable? Would it be an offense to not fully disclose all war losses? If so, what would be the penalty? Who enforces it?

Originally by: Zuper Phrend

---

I notice that I haven't even mentioned research tools or IPO underwriting in my post! (Sorry), I will get to that if people still show interest in this idea a couple of days from now.

---

Underwriting as well? Let's draw a line somewhere. After a hard day at work, do I really want to have to negotiate underwriting terms in Eve?!

What next ... share buy-backs, consolidations, splits, redeemable preference shares, hostile take-overs, schemes of arrangement, a 3% creeping share acquisition every 6 months, substantial shareholder notices, associate rules, definitions of "control"? Please, for the love of Eve, no.

Enjoy the RL stock markets and enjoy Eve but let's not mess up what is a damned fine game by combining them. The operation of "an efficient, fair and well-informed market" would have to involve some degree of grind and procedure in the game that would, for me at least, detract from the fun experience.

Stock markets and corporate equity are incredibly complicated beasties that are open to manipulation at the best of times, even with all the LR safe-guards and multitudes of people employed to ensure "an efficient, fair and well-informed market".

Finally, let me leave everyone with this; do you really want the mega-wealthy in Eve to become even richer and to have the means to buy your corporation out from under you in the secondary market?

Posted - 2005.10.21 02:01:00 - [15]

 

The ISS Marginis Project shows that IPOs are a workable in the current system (they raised 36 billion for an outpost construction, I believe).

They are using NAGA corporation to handle the trust issue in secondary share trading, but I think its up to buyers and sellers to find each other. Does anyone know if there is much trading of Marginis shares going on ? It would be nice if CCP introduced some easy way to trade shares.

Do you think there is enough interest in share trading and investment in EVE to support an auditing company ? Potential buyers, sellers, brokers, stock exchange companies (are there any at the moment ?) could hire the auditors. Companies being audited would let an auditor company character into the corp temporarily and give the auditor full accounting roles. Auditors could also interview customers and suppliers.

Chiralos

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