I’ve posted significant changes to the market mechanism tonight. In general the changes are designed to deal with the mounting complaints about the inability to unload shares due to a lack of liquidity in the market. I don’t kno if these msteps will rectify the matter, but I sure how so. Please let me know what you find.
Thot Buy-backs
In certain circumstances, thots themselves will buy back their own shares using money they have earned as revenue. This action will happen only for thots below a certain market cap. The reclaimed shares are still available on the market, as the thot will set its selling price to the default increase (usually 2% over buying). However, thots will start to decrease the selling price of the shares they own themselves, if there have been no trades on that thot for 24 hours.
Thot Revenue
Thots will pay for this investing with the money they earn as revenue. This will effect dividend payouts for some thots. You already know that thots earn revenue from comments that are posted, well they now also earn it from click-throughs. That is to say, you will be charged each time you click through to a thot. The price is currently $0.25 for each pageview of the thot detail page and $0.50 if you follow the link offsite. You will not be charged for each of the actions more than once for a one hour period (that is, you can view the thot page as many time as you want in a the space of an hour and only be charged once). These charges are billed to your bank account in one-hour clumps and will show up as ‘Hourly Activity Bill’ in your statement. What about the activity of un logged visitors? Well, their activity also counts toward revenue for thots, asn is funded by the ThotMarket Reserve as long as the reserve has enough money to cover the expenses. This reserve is in turn funded by the proceeds of the Ad auction.
Thot Loans
Desperate times call for desperate measures. Thots that are truly struggling, that is to say those that have a dwindling market cap, and have received no trades for over a day, have one last countermeasure. These thots will start to borrow from their own initial investment to prop up their own revenue. Each day that they remain on the market and are still struggling, they will transfer half of the wealth stored in their initial investment into revenue. This revenue will be used for dividends or share buy-backs just like any other thot. Of course if that still doesn’t entice investors, and no one bites for four days, the thot will be de-listed as the junk it so rightfully is.
Stimulus Package
To help jump start this new stage in Beta 2, I’ve released another stimulus package. This time, anyone with a bank balance less than $1000, has receive an additional $1000 to try everything out.
I’m sure I’m forgetting something here. Whatever, let me know if the changes improve your trading experience, or not.
ThotBlog 
25 Comments
What if the thots are owned by us?
Will we be charged?
You’re charging to view thots and to click links off site? Well you’ve officially killed the social bookmarking aspect of the site. You need to decide what you want the site to be, is it a stock market game or a social bookmarking site? If it’s a stock market game you need to get rid of the unlimited creation of new stocks, if it’s a social bookmarking site you need to not punish people for using it as such.
The click throughs should not be charged to the shareholder. As “none” very obviously pointed out you may end up killing what you intended this site to be.
Also in creating a new stock at let’s say $10 capitalization you then add a dividend to that stock what is happening is your thot will buy shares equal to the amount of revenue you put into the stock comment section. That happens on the hourly mark when you get charged for clicks. Now I have two stocks where I have lost about 18k to thin air before I figured out this problem. You need to let us know what the minimum capitalization rate is before a stock does this. That way we don’t get burned setting up new stocks with dividends.
The threshold for triggering the buy back is a marketcap below $500. I’m not convinced that the charge for click-thoughs is necessarily a killer, although the amount may need to be different than it is. Perhaps we should let the thot controller set the price, and give ample warning to potential clickers before they proceed. I just don’t agree that the site needs to be either a game or a bookmarking site exclusively. I want both draws, and I like the fact that the bookmarking aspects work differently than other bookmarking sites. We already do things differently by charging users for comments, etc. Different can be good. Of course, I’m just trying out different ideas until we find one that works. I have an open mind and all of this may change based on how it operates in the field.
The fact is that the money to fund thot revenue and its increasing importance, has to come from somewhere. The argument can be made that it should come exclusively from the reserve, but the jury’s still out on how much the reserve can afford in the long-term. Don’t forget that the reserve is already funding thots for click-thoughs of non-logged visitors. These are site visitors that are not participating in the game aspect (of which I am finding quite a few). It seems to me that the activity of these people needs to be reflected in the measure of thot success somehow.
I like the idea of people setting the charge for “clicks”.
I agree with putting Thot controllers in charge of setting the clickthrough price, although there should probably be a minimum amount set by the system. I’d suggest reducing the cost of viewing Thot detail pages, as that’s a real disincentive to poke around and find things that might be interesting, either from an investment perspective or from the bookmarking perspective.
I still didn’t understand perfectly the new rules, my English is a bit incomplete.
About the multiple thots, rwork already said that we should flag duplicated thots.
How about thot rating. Maybe that way, rubish thots would disappear in the rating rank…idk…what do you guys think?
All I know is that some thots are pure spam… <.<
The buy-back mechanism seems to kick in awfully quickly, making it harder to manage dividends. It might need some adjustments.
Well, it’s getting a bit more interesting again. Nice to see some activity – thots gaining income like little companies. At first, I was a bit uneasy about the charging for visiting the detail pages of thots, but as of now, the “Activity Bill” is pretty small – dividends, though fairly small, from one (apparently – had no idea!) semi-popular thot more than covered for it.
Some ideas:
1. If the income falls below $100 ($0.01 dividend rate), how about still paying a dividend based upon the multiple of $10 earned, but instead of it being for each share, the amount being for each X (2 to 10, or a lower upper limit if you set a higher minimum of income) amount of shares, where said amount is the smallest to bring it >= $0.01?
2. To avoid clutter, incomes and expenses below $10 could have an option to be summarized on the Bank History page as a daily sum adjusted over time.
3. I’ve sent this using the feedback form before, but having an option to enter a ticker symbol to immediately go to a thot instead of having to go through a potentially long search result would improve navigation.
to get around the fees to use the site I’ve taken to surfing logged out or only when I have a 0 bank balance. But overall I’d still say charging people to use the social bookmarking aspect of the site is a dumb idea.
Well, I’m playing around with it. As of this morning, I’ve started subsidizing all of the click-throughs with pay-outs form the reserve. I want to see what effect it has if thots earn a lot more money overall (independent of comments) and see how the reserve holds up. This might lead to a reduction or elimination of the user bills for activity. If anyone has any ideas about other ways to fund the reserve (in addition to the ad auction) let me know.
No offense, but ever heard the term if it ain’t broken don’t fix it?
Original ruled….this is just getting worse.
DeatH, Sorry you’re not liking things. If the original that you’re referring to was beta 1, then, it was most definitely broken and in need of fixing. If you’re referring to the early beta 2 version, then I’d just have to say that something was wrong, since traffic and retention of users was dropping everyday. On a positive note this seems to have stabilized for the time being. That being said, I’d love to hear about your ideas for improvement.
Hi,
Thank you for continually working on this system rworkman. So far I have liked the new changes when I see them in action. On paper I wouldn’t have agreed with everything and I like a few other people here am still a little confused about the workings of the buy backs.
I was however, almost ready to just quit the site and leave when i logged into Beta 2 and started having problems. I had gone to buy stocks that I wanted and when I hit purchase it redirected me to another stock and put in my purchase into that thot which i did not even want. I then tried to get rid of it and wasn’t able to no matter what my selling price was. I was frustrated enough to almost leave (since I could no longer play the game due to all my money being tied up in a thot I didn’t like) but your stimulus packet came right in time.
As for the updates, I don’t think that thot owners should choose the browsing price. Beta 1 was fun and enthralling partly due to its ease of use and simplicity. There are already too many options here for the average casual browser in my opinion and adding this new one would just be a poor decision in my mind. This is not to say that I don’t like the idea of getting revenue from clicks. I highly believe that some revenue should be earned by following the link off site. I don’t think that viewing the page should charge you though.
Thanks again for your time and work. Keep up the good job.
I like all of the changes you’ve implemented! At first I was a bit stumped, I blew all of my money on IPOs that had little market cap and made no money for me. Finally someone bought some shares.
With that money and the stimulus checks I was able to find cheap, promising stocks that made money in the long run.
Now I can fund worthwhile IPOs and created dividends. It is true that you need money to make money!
I would recommend a page that has investing strategies, new users would be greeted with a message that directs them to this page. Hopefully then people wouldn’t make the same mistakes I did and then just leave the site.
Cheers, Flann
Everyone read carefully the “Thot Loans” aspect of the changes. It may allow one to do a little corporate raiding and make some money. I am currently testing it on a stock I bought up that had a major capitalization. I didn’t buy all the stock but bought all the cheap stock and have near 70% control. If the Thot pays out like advertised in the “Thot Loans” write up I stand to make double my money. Be careful however when anylizing a thot. I am not sure this is going to work right however if it works like I think it will I will follow up with a how to on corporate raiding.
Rworkman-
I do have a question on how capitalization declines. How does it decline without paying any sort of dividend out? Can you explain a bit in detail how a stock loses it’s capitalization?
Excuse the crappy spelling above.
Marrakaechll,
I’m not sure I understand your thinking on the ‘thot loans’. I don’t see how the strategy you’ve described will double your money, although perhaps I’ve just been up too long and need to get some sleep to clear my head. In any case, please report your findings. I appreciate all of the experimentation.
As for the caps: Cap is calculated simply by adding up the money that has been invested in a thot. When a trade occurs, the investment that the seller made is deducted from the cap and the investment of the buyer is added to it. So, if the seller sells shares or more then they paid for them, the cap increases, If they sell them for less, then the cap decreases.
Let me know if I understand the thot buying back it’s own shares. I bought 70% of a thot that has a capitalization of 84k. Now if there is a lack of activity because of the price being to high or no dividends the thot will eventually start to use its capitalization to pay dividends, correct? If that were the case then one could buy a thot for cheap enough that it would pay to sit and wait for the thot to payout. Do I understand this correctly? Eventually the thot would divest itself according to the new system you put in. If I am wrong please correct me so that I can understand correctly.
If the trigger for buyback is >$500, then in the scenario you describe would the Thot not start buying back? Would it get delisted before it reached that stage?
The market cap must be less than $500 to trigger any buyback activity. The thot doesn’t borrow from the market cap, it borrows from the money deposited into it via the IPO. That is the ‘initial investment’ amount that the starting user set when he/she did the IPO. This, btw, provides a potential incentive to consider IPOs with larger investments.
At the moment, de-listing occurs when two things happen: 1.) the balance of that ‘initial investment’ account has been largely exhausted, and 2.) the trading price dips below a very low amount. The trigger for de-listing is something that I’ve been trying to fine tune. I’m not sure that (2) is a necessary requirement. Trigger (1) has among other things, the effect of preventing a thot from de-listing in less than four days after IPO (since a minimum investment of $10 is required for IPO).
Alright this is where I was thinking that the capitalization and IPO initial investment were the same. How will the system know the difference? We view it as the same from our end so there would be no way of knowing if a stock had a large investment from the initial IPO offer or capitalization after the fact. I say blend the two and let the thot payout like I thought it was going to.
Ahh, this is now getting down to it. The problem with paying out from the marketcap (blended) is that the marketcap number is just a reference, not an actual pot of money sitting in an account. That money was transferred to the seller when the stock was traded. So, if I now pay out from this ‘money’, I’ll actually be injecting new money into the economy, causing inflation. This was, in essence, one of the big problems in Beta 1, where the amount of cash swirling around the economy just kept growing. It took me months to wrap my mind around that. The IPO investment, however, is a pot of money that is just sitting there, and if I don’t have a mechanism for recycling it back into circulation, it will in essence have been removed from the economy causing a net decrease of money in flux. But you make a good point, investor should probably know what the balance of the IPO investment account is, so they can make smarter choices. Have any idea what I should call that account? Or, do you have any ideas about how I could restructure the system to operate as you describe without inflating things?
BTW, this discussion has revealed a problem in the current buyback/borrow mechanism. That is, thots that have a market cap above $500 can become stalled if trading stops, since the market cap will only decrease if people start trading it for less. Seems to me that the answer is to tweak the buyback trigger to also kick in for all thots (regardless of marketcap) after some period of inactivity, say 48 hours or so.
Glad you figured out a problem from this discussion.
As for the marketcap vs IPO value. I suggest calling the IPO initial investment the “Book value”. That is a term used in the real stock markets. So if a stock trades very high above it’s “book value” then people know it is priced to high. I also suggest that a percentage be held back from IPO’s and Dividend payments that are applied to the “book value” of a stock. Let’s say 5-10%? As you know I am the dividend king. So if I put in 10k to give a dividend of a dollar now. In a new system 10k would only give a .90 dividend. The remaining 10% goes toward the “book value” of the stock. Also if an original owner is selling their shares they could also have 10% taken off the top to apply to the “book value”. This solves the problems of rampant inflation and is only affected by real monies. A solution and an interesting twist all in one?