The Best Part of Grand Theft Auto V is the Stock-Trading Platform
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I'd argue the opposite, no? The 100-year-storm of destruction that we, as Player 1, unleash upon the poor Liberty City automotive world would probably make any insurance company run screaming and crying in the opposite direction of profitability.
"We had HOW MANY claims yesterday afternoon??"
:)
Did I say casinos? I meant insurance companies.
Seriously, insurance is a bet on something bad happening. Usually it only makes sense to buy insurance for the equivalent of long-shot "lottery jackpots". Like a catastrophic health problem. Or like the damage you might do to other people and their property in an auto accident --- but probably _not_ the damage to your own car. i.e. Insure for personal liability calamities, but not collision damage if you could pay for it out of savings.
If you can afford to replace everything you own out of savings, good for you, but most people can't.
No clue if those things exist anymore with everything going on in the world of health insurance, though.
Therefore, you really need to buy at least catastrophic coverage. And that's real insurance, not self-insurance.
That way you insure the vast majority of things, but you are covered for the really insane stuff, plus you get the benefit of the negotiated rates.
Exactly this. The advice I was always given is that if you can afford to replace x (whatever x is) if something bad were to happen, then it's better not to bother. But if you can't, and x is necessary for your life, then you need to accept insurance as a necessary evil.
Not that it's relevant, but I can't. Anyway, I didn't say anyone should plan to replace everything from savings. My point is, whatever you _can_ replace from savings, don't waste money to insure _that_.
They're related but opposite concepts.
"From each according to his ability, to each according to his need." -- Karl Marx. Not a misquote.
And since you make the explicit point that you're not misquoting: No, but the quote you give is severely out of context.
Marx very specifically did NOT believe that this would be the case for _socialist_ society, but for a well developed _communist_ society, and that in any case he makes the case that it is really a distraction.
The quote is from Critique of the Gotha Programme, a critique of a draft programme of the United Workers Party of Germany.
The full paragraph reads "In a higher phase of communist society, after the enslaving subordination of the individual to the division of labor, and therewith also the antithesis between mental and physical labor, has vanished; after labor has become not only a means of life but life's prime want; after the productive forces have also increased with the all-around development of the individual, and all the springs of co-operative wealth flow more abundantly -- only then then can the narrow horizon of bourgeois right be crossed in its entirety and society inscribe on its banners: From each according to his ability, to each according to his needs!"
This was part of Marx' criticism of this phrase in the programme:
'3. "The emancipation of labor demands the promotion of the instruments of labor to the common property of society and the co-operative regulation of the total labor, with a fair distribution of the proceeds of labor.'
Marx made the point that while this is desired endgoal in a communist society, the above programme point is largely meaningless in terms of practical policy for a revolutionary party that has communism as its goal, as the distribution of wealth can not reasonably be treated separate from the ownership and control of the means of production. Thus focusing on redistribution is effectively making an own-goal, playing right into the hands of the ruling classes and/or reformists by changing focus away from the necessity of restructuring society and the control of labor.
He goes on after the most famous part of the quote, to say:
'I have dealt more at length with the "undiminished" proceeds of labor, on the one hand, and with "equal right" and "fair distribution", on the other, in order to show what a crime it is to attempt, on the one hand, to force on our Party again, as dogmas, ideas which in a certain period had some meaning but have now become obsolete verbal rubbish, while again perverting, on the other, the realistic outlook, which it cost so much effort to instill into the Party but which has now taken root in it, by means of ideological nonsense about right and other trash so common among the democrats and French socialists.
Quite apart from the analysis so far given, it was in general a mistake to make a fuss about so-called distribution and put the principal stress on it.
Any distribution whatever of the means of consumption is only a consequence of the distribution of the conditions of production themselves. The latter distribution, however, is a feature of the mode of production itself. The capitalist mode of production, for example, rests on the fact that the material conditions of production are in the hands of nonworkers in the form of property in capital and land, while the masses are only owners of the personal condition of production, of labor power. If the elements of production are so distributed, then the present-day distribution of the means of consumption results automatically. If the material conditions of production are the co-operative property of the workers themselves, then there likewise results a distribution of the means of consumption different from the present one. Vulgar socialism (and from it in turn a section of the democrats) has taken over from the bourgeois economists the consideration and treatment of distribution as independent of the mode of production and hence the presentation of socialism as turning principally on distribution. After the real relation has long been made clear, why retrogress again?'
In other words: Marx saw the focus on redistribution as largely _missing the point_. The main issue, according to Marx, is the mode of production: ownership of the means of production and conditions under which people work.
Thus the systems inside any large company, no matter how much you "spread the wealth around" is a sideshow: Unless it alters the decision process, ultimately the distinct capitalist distribution of wealth eventually asserts itself. And just how many capitalist companies do you know where an objective measure of productivity, rather than hierarchy, is used to determine what is available to most employees?
There may be socialist ideologies that might fit your idea - various meritocratic systems, such as Saint Simon's original technocratic meritocracy, for example might be a better fit. But Marxist it isn't.
Socialism's the one that thinks all men are born equal. Everyone gets the same computer and cubical. Productivity is irrelevant.
You might be muddling Socialism up with Communism (or Marxism).
"Ism's in my opinion are not good."
If casinos find themselves paying out too often, they change the size of those payouts with respect to how much it costs to play, until they are back in the black. If insurance companies find themselves paying out too much, they raise their premiums. Same basic concept, the only thing that is different is the motivation of the customers.
Insurance companies essentially work by the Law of Large Numbers: that in a large enough number of trials, the average value should approach the expected value. In real world terms, if the chance of a house burning down in a fire is 1 per year per 1000 homes at an average cost of $200k each to repair (totally bogus numbers), then an insurance company can break even by charging a homeowner $200/year to insure the home against fire.
Over a large enough number of homes, that should be reasonably close to the actual amount they have to pay out. Tack on a profit margin, and you have a business model.
Edit: Fixed numbers a bit. Thank goodness I'm not an actuary.
In the game world, insurance companies wouldn't have predicted the level of claims.
But if the game's premise is that the mayhem is normal within the world, then insurance would be stupid expensive. But, assuming the market can bear those prices, insurance would be a good business to be in.
How do they make money? http://seekingalpha.com/article/419731-buffett-on-insurance-...
Basically they invest your premiums during the time you are paying them and make money off of holding your money. Then the other insurance agencies might lower their costs and end of paying out 104% (or whatever) of what you've paid in. This competition pressures the market to close the gap between what you can make on the float and what you can charge your customer, but there is going to be some gap and that is the profit margin.
If the insurance company can make a high ROI on the float, they can charge less in insurance rates and still make money.
However, GEICO is not a good example, because it is the exception to the rule. GEICO usually makes an underwriting profit -- often a very large underwriting profit.
In fact, all of Berkshire Hathaway's insurance operations make a long-term underwriting profit. Unlike GEICO, the reinsurers do not make a profit every year, because hurricanes and earthquakes are unpredictable. (Whereas car crash statistics change very slowly from year to year.) But averaged out over a long period of time, they make a profit.
This is the secret of Warren Buffett's success as an investor. He is essentially buying stocks on margin, at a negative interest rate.
Data collected from Berkshire Hathaway annual reports:
2012: $680 million profit on $11,578 million float
2011: $576 million profit on $11,169 million float
2010: $1,117 milion profit on $10,272 million float
2009: $649 million profit on $9,613 million float
2008: $916 million profit on $8,454 million float
2007: $1,113 million profit on $7,768 million float
2006: $1,314 million profit on $7,171 million float
2005: $1,221 million profit on $6,692 million float
2004: $970 million profit on $5,960 million float
Not broken out separately prior to 2004
Early on, before people started to realize how the market worked, I did some pump-and-dump schemes and made >$400M. That's a lot of money, even in GTA. Now that I have that much money I can drive stocks up or down and milk the market for all I want. GTA isn't just for blue color crime anymore.
I know that a few other players did equally well, I suspect they are doing similar market manipulating schemes.
I'm surprised no Scots have popped up to point out how hilarious that market's name is ;)
EDIT: Oh wow, Wikipedia has everything: http://en.wikipedia.org/wiki/Pump_and_dump
You then sell all your stock for a tidy profit and watch the price, and the hopes of the other investors, collapse.
You have a small starfreighter, and one way to make money is by buying goods where they're inexpensive, loading them up in your cargo hold, and flying somewhere where they're expensive to sell them.
Eventually you realize that it makes sense to pay other freighters to help you carry stuff so you can make more per trip---but since they charge a daily rate, at what point is it worth it? And does it make sense to risk it all ('cause, you know, space pirates) putting your life savings into a load of expensive opals which will make you a ton once you arrive, or should you play it safe and stick to inexpensive but barely-profitable foodstuffs? If you've got an appetite for risk, you can carry drugs or illegal biological weapons, both of which will make you a ton of money, but will cause law enforcement to attack if you're scanned.
It's a sort of mini-version of EVE this way, in that it's the only game I've made a spreadsheet for.
edit: nope, that would be SpiderWeb, who has apparently renamed the series to "Avernum" (???): http://www.spidweb.com/
You supposedly can also game the market by investing in competing companies (like Cluckin Bell and Burger Shot) and just destroying a bunch of the opposite companies. Then after the drop, reinvest in the opposite as they equalize and come back (or just keep going back and forth). Haven't tried this yet, though.
One thing I learned in that game is that while one can make a lot of money being the middle man, the real value is from labor (as far as WoW is concerned) -- but grinding for materials can also be monotonous and not so profitable if you don't go about it in the right way.
So, there are lots of addons (Auctioneer being the most popular) to help one track data throughout the market.
Every action also required far too much clicking, which meant many people just used tools like autohotkey (cheats, although nobody ever got banned for them), and having to relist products constantly to beat minor undercuts was a terrible experience.
WoW AH is to virtual markets what hitting a pinata is to hitting something that fights back - it's simplicity makes it unrewarding.
I think you just invented a new term that has lots of appeal to me. :) Just saying it: "I want to do some market PvP" makes me ... want?
EVE Online probably comes closet to this ... but it reminds me of a prolonged Dune story; doesn't bother me, though. :)
I think connections and information also helped out a lot
1) Buy bulk of item X.
2) Divide item X into single units and post on AH with a markup in the price.
People would then buy it because they would need only 1 or 2 of X instead of 10. It only worked for some items and under the right market conditions, but when it worked, it was a simple way to make money. From this I learned some important lessons:
1) Convenience == profit. This is the basis of a lot of business and industry. Why do people use and pay netflix instead of downloading shows? Convenience. Why do supermarkets exist? Convenience. And this is just a specific form of a more general rule, time == money. If you can save people time (convenience) then they will pay you for that service.
2) It made me appreciate and respect more how difficult this must be in the real world. In the WoW AH, I don't have to worry about things decaying or transportation or other things. But the supermarket down the street with shelves full of food? How do they know how much to buy in bulk and sell in units before the food expires? What do they do if they're wrong? I realized that just managing the inventory at a store could be an interesting computer problem. Models, simulations, even some AI could be used to try to figure out the best decisions. And companies already do this and those that do it well have a massive competitive advantage.
It got pretty instinctual after a while -- Holiday? Better get the baking materials ready! Martha Stewart mention something on her show? Better have 10x available the next day! -- Those scanner guns you see clerks wandering around with from time to time have all that data (well, not the Martha stuff) right there at our finger tips. It even alerted you if something was well out of the norm.
The balancing act was to not overdo it - depressions was not fun if you were overly indebted.
Shorting the stcok of competitors were always good fun though, but mostly since they were so horribly bad at building which resulted in that it was sometimes a good idea to shorten stock.
Sigh - how I wish for a spiritual successor to Railroad Tycoon 3.
http://massively.joystiq.com/2008/07/14/eve-evolved-freeform...
Makes sense that in a open sandbox crime simulator, players would try to make a killing in the stock market. Too bad you can do insider trading to get involved in white collar crime.
You can buy stock in a company and then accept missions to assassinate a competitors keep employees!
FTA Throughout the game, you're given opportunities to manipulate the markets. Some missions, for example, require that you kill the CEO of a company. You could, theoretically, buy the stock of that company's competitors and profit when they rise after the killing. And since there's no SEC policing stock trading in Los Santos, you're not going to be busted for insider trading.
The guy giving you the assassination missions more or less tips you off each time what stock to buy.
1. My understanding is that this has been widely theorized and fairly well researched, and most people have concluded that there's no relationship.
2. I don't understand why a rampage would cause the stock price of an insurance company to go up. You could argue that in the long-run, living in a town with regular rampages might encourage people to buy more insurance, but one would think that in the short term all of those payouts would be really bad for the insurance company.
although the game focuses on a single character and thus makes the actions of that character carry supreme importance, in the larger context the actual effect isn't that great compared to the average.
However, the media effect in the context of the game would probably be pretty fantastic, in effect creating free marketing for the company.
At least, that's how news media plays into things like that where I am living.
I spent quite a while trying to figure out how to short the stock of the drug company whose jurors I was sent to kill, but gave up and simply bought the rival's stock. (I think I made more money off that one transaction than any actual mission aside from the final one.)
Also, I know writers at NY Mag and others that have literally said to me "I don't know why you go on Reddit, I get paid to find stories on there and I still hate using it." HuffPo and everyone else literally just sits on the site waiting to take content.
(My fiancee's gaming clan is planning to be in GTAV in a big way, starting tomorrow.)
It's a combination of updates to make the game work on modern systems/resolutions and a bevy of new features/usability improvements.
http://en.wikipedia.org/wiki/Wall_Street_Kid
The premise of the game was fairly ludicrous: if you could earn a decent return on a $500,000 loan, you stood to inherit a $600 billion (!) family fortune. But the stock market in the game, while randomized, was pretty innovative for its time. (It's been awhile since I've played it, of course, but I vaguely remember that there was some sort of internally consistent logic behind the stock pricing movements that seemed to be randomly seeded at the start of each game).
As far as I can tell, the entire game revolved around getting rich off of stocks, wining and dining an increasingly high-maintenance trophy wife, and making a series of very conspicuous consumptions (a yacht, a penthouse, and even a castle). But the mini game in GTA V seems very similar.
Turns out I did about as well in the real stock market. gg.
The game was really fun though
Lots of fun! Unfortunately, I grew up to be considerably less successful and, at least for now, castleless. :)
One comment on being able to short... Based on how the game is described (I may be the only one the planet not to be an active player) it should be possible to short a stock. Every time you get new money, split the purchases evenly between all stock. (Can do a weighted average if you want) Then when you have information (like you're going to kill the CEO) then you have shares to sell on the bad information. It's not a concentrated bet, but you still can effectively short it.
There are 4 stocks in the world, A, B, and C, and D, all trading at $25. I invest $100, buying $25 in each.
Now lets say that I know for sure that stock D will go down because I'm going to whack the CEO. So I sell my $25 of D, and put it in A, B and C (A stake of $33.33 in each - let's assume fractional shares are ok.) If Stock D goes to 0, while the others all double. I have a net gain of $100 - $75 from the stocks I already held, but $25 from the new investment, and I've avoided $25 as well.
Let's say you lived in a world where shorting was ok. If instead you invested $25 in A, B and C, and shorted $25 on D, you would gain $75 in A, B and C, and $25 on your short of D. In essence it's the same $100 profit.
Now this only works if A, B and C are also going up.
Let's say that D does move on the event, but A, B and C don't. If you do buy back D after the event, you ultimately are in the same position in both cases. In the shorting case, you have $100 in securities ($75 original, plus $25 of D bought near 0) and in the "sell now buy later" you sell back $25 of A, B and C to buy at the bottom.
Net - you create the effect of shorting.
This falls apart if you want a very concentrated bet, but it's a way that long-only professional money managers who compete against indexes find a way to effectively short.
Think of it this way - in both cases you're selling today, and buying later. The only difference is the "hold the whole market first" strategy requires more capital. (There are market technical differences too, but for short time periods these aren't as significant)
That's not the only difference. It's not even the biggest difference. The major difference is that in your scenario you have a big unhedged exposure to the market (your p&l depends on the performance of A,B,C) and in the case of just shorting D you don't (doesn't matter what happens to A,B,C). That's a pretty big difference.