Just a thought, inspired by the current global financial crisis : I would love to see a serious game from Global Conflicts that would treat this subject. The journalist would walk from building to building in Wall Street, etc. Could be both very educational and very visual. Maybe Eric5h5 could contribute with his own city blocks 
The problems are in large part caused by professional investors investing in financial derivatives they didnât understand⌠So I doubt that even a good simulation of what it would be like to walk into their offices and talk to them would be especially illuminating.
I donât know⌠a game with complex rules where you lose no matter what you do might not be too much fun.
(oh, and what I was originally going to post is âI think people might enjoy it more if it was an FPSâ. But that wouldnât be appropriate, right?)
Heh the other day I was thinking of including actual market data along with weather data to affect the mood of a population of sims
There are a few titles out there that might satisfy this, though on a relatively fictional level. Youâve got items like Republic: The Revolution, the SimCity series (where economic choices and government business deals play a factor) and perhaps Sid Meierâs Civilization series.
Another possibility, would be to bring popular text based economy games into the 21st century, like Stock Trader. You could even use information from our actual stock market in real time as a means of providing seed data to your game. Allow people to invest fictionally into our real-world economy and simulate the outcome of their decisions based on the data coming in.
Etrade already offers an investment game based on real market data â has done so for years.
I am thinking a âPainkillerâ version of Wall Street would be a hootâŚ
Hey, I like the idea of interfacing with real datas - in read-only mode, of course :roll:
By the way, an example of something that could be turned into a game, if you can read French (donât know if it exists in other languages ) :
http://picasaweb.google.com/rue89.com/Babasubprime?pli=1#5247371225253896482
With âslightlyâ better graphics - and with some well done 3D representations of the subprimes mechanism - it could be perhaps interestingâŚ
Less ambitious, but potentially a well selling iPhone app : one could make a âsave them upâ based on this drawing I saw on an American paper - canât remember which one - that shows Uncle Sam in a helicopter trying to rescue some surviving traders who climbed over the roofs to escape gigantic wavesâŚ
If you imagine âfantasy stock tradingâ becoming as popular as fantasy football, itâs quite possible that the game could have a real-world impact. E.g. a huge number of people playing fantasy stock trading who also happen to have actual stock portfolios could become convinced that a particular stock was going to rise or fall and act accordingly in real life.
Of course this is no different from what happens in chat rooms.
The whole point of eTradeâs game is to provide a harmless way for people to learn how everything works. The nice thing for them is that itâs trivial to provide a completely realistic experience.
Imagine you do something like this based on disaster relief. You could score points based on having the right (simulated) personnel in place to handle actual disasters. Sadly, your fantasy disaster relief personnel couldnât actually help anyone. (read-only data 
)
However, the game could display a web page showing where all the players were placing their disaster teams weighted by their aggregate scores⌠âthe wisdom of crowdsâ could actually provide good educated guesswork on where disasters were likely to occur.
OK, going back to the subprime mess ⌠the real problem isnât so much the mortgages themselves (bad as they are) but the derivative products built around those mortgages. To put it in simple terms â if you lend someone $X against a house worth $Y, then the most you can really lose is the difference in the houseâs actual value from the outstanding amount if the mortgage defaults. Since house values donât typically disappear overnight, this isnât enormously risky. (If the house price drops by half, youâve lost less than half your money, since $Y > $X, $Y/2 > $X/2.)
But derivatives can do things like sell the difference between the loan amount and the property value should the mortgage default. I.e. I could agree to pay the difference should the mortgage, hypothetically, go into default some time in the future in exchange for your giving me $10 today. So, if the mortgage doesnât default, itâs free money â yay! If the mortgage defaults, but the house is worth more than the amount loaned, still free money â yay! But if the house drops in price by half, ruh roh, I now OWE someone $150,000. (And all I got was $10.)
AIG bought the risk on MILLIONS of mortgages. Because all this stuff is opaque, all we saw is AIG got lots of money for, apparently, nothing. Wow, theyâre so clever! Yay! But then thousands and thousands of mortgages defaulted. Dâoh dâoh dâoh dâoh dâoh dâoh dâoh.
This is how derivatives can turn a multi billion dollar global empire into a steaming ruin in a matter of days.
Now you know what went wrong, and you donât need to design a game about it.
I am going to retort with âPainKiller$2Kâ
Salut Yann, here is the English version:
http://docs.google.com/TeamPresent?docid=ddp4zq7n_0cdjsr4fn&skipauth=true&pli=1
Until you find your first weapon, you collect points by bitch-slapping people who bought mortgages they canât affordâŚ
But precisely, even if we are able to understand the basics of what happened, we still donât know why so many people with a brain chose to maintain years and years long a system that was mathematically condemned. âAbsurd strategiesâ can be observed in so many human catastrophs that could - and logically should - have been avoided, but that âsomethingâ, some kind of suicidal âinstinctâ of the system, wanted deeply to happen, leading a sufficient number of people to adopt some specific strategies that they mainly see as âlocalâ, but that âfitâ perfectly together, and the combination of which creates the catastroph in an appareantly unavoidable process. This is what interests me : the universal part which resides in a particular tragedy.
The goal of the game could be to hunt down that âsomethingââŚ
OK, Iâll calm down
Well, theyâve only been condemned in hindsight. The problem with âinnovativeâ derivative products is you need to figure them out for yourself.
I agree, this is interesting stuff from a psychological/economic viewpoint, but suspect the answer is also pretty simple. If youâre some kind of mid-level trader at AIG your incentives are all about looking good in the short term. So if you get a quick payoff that exposes your firm to a horrendous hypothetical downside, it doesnât matter so long as you get your bonus/promotion before the shit hits the fan. Meanwhile your boss is too busy snorting cocaine off hookersâ tits to actually do the math and second-guess you. Besides, he (or, improbably, she) gets bonuses too.
So, fundamentally, thereâs nothing new here that we havenât seen before (indeed, quite recently). Cough. Enron. Cough.
Oh and Barings of course is AIG in microcosm, except it was done as corporate policy vs. by a trader trying to cover up his earlier mistakes.
BTW: Sarbanes Oxley did NOTHING to prevent any of this, but forces every programmer in corporate America to do ridiculous stupid things to change a single line of code.
OK, first of all : letâs build a cocaine particle system
Merci !
The answer to this is actually quite simple: it was all about short term gain.
If you donât understand how or why you need the frame of market economics:
The system was maintained because the participants were gambling that they would do well by it in the short term. And it is competitive so each individual is in a rush to get theirs before others. Ultimately they were not invested in the longevity of the system. There is no incentive for any single participant to care about the bigger picture - which is the blessing and curse of âfreeâ markets.
The failure ultimately comes down to the structure of the market system and the influence brought to bear upon it by the messy mix of politicians, lobbyists, and businesses. You need to ask why the managers of the institutions who oversee this financial market allowed this to happen - even though it happened in the 80âs/90âs at a smaller scale with slightly different details through the savings and loan crisis.
This is true to a point. Some people view it as a failure of market economics, but nothing could be further from the truth. Things started going awry back in the 1995 when Bill Clinton expanded the scope of the Community Reinvestment Act. It had laudable goals, to give every American a chance at owning a home. However, when the government interferes with market forces trying to force some social outcome, the result is never good.
Of course, the politicians are quick to blame it on âthose rich wall street types.â God forbid anyone look closely at their hand in the mess. They donât want you to know they were there twisting the arms of the CRA regulated institutions with the force of government to push these loans on people.
OK, some new characters in the assets folder : the politiciansâŚ
read my post again. Your inference that my post was anti-market is your own and has little to do with what I wrote. I am not interested in discussing economic policy here as Iâd rather not get into a political debate. Ultimately in my mind, yes this is a political problem, but I donât want to engage in a debate of such here. Especially not in one that attempts to place this whole problem at the feet of one recent president when the problem goes back over thirty years as I intimated in the post above.
As an aside I highly recommend reading heavily on market economics. Looking at how specific markets actually function erases a lot of the dogma that clutters this issue- regardless if that is left or right leaning dogma. The reality is far different.