Railway Empire - Railroad Tycoon from Kalypso

Regrettably my copies of both of these are residing in the twilight zone known in court documents as “the former family home”…pretty sure I had to import both of them in the first place.

And Rails West!

Welp, I’ve given up on both Railroad Tycoon 2 & 3. It feels like you have to be a real life stock broker to understand the economics. The game does NOTHING to explain what al the stock stuff means and the UI doesn’t help much in highlighting how it translates to real number.

Even after reading the wikiedia entries for all the terms (margin buying, short selling, stock splitting) AND just finishing watching The Big Short, I’m still clueless what this stuff means. I feel like all the audience stand in characters from The Big Short balking at how any of this makes economic sense or is legal (“I can buy stock with money that’s not mine, but it’s not a loan, and the company foots the bill instead of my personal fortune even though I’m the one that makes the money? Huh?”).

With all due respect, I would suggest taking a Finance course because these are quite common concepts. It may serve you well IRL since much of this exists in the modern stock market. I am not trying to be insulting but merely offering advice that I think may serve you well.

Margin buying - your broker allows you to buy stock by putting up cash of only 10% (50% modern day) of the total value. You are essentially using the broker’s money to buy stock now betting the price will rise. The issue is that you can get very over-extended (over-leveraged) very quickly.

Margin Call - This is the downside of margin buying. Your stock value has dropped below your up-front payment. You must come up with cash to fund the difference. This often results in having to sell stock during a bad market, which means the stock goes down again, which forces more sales, which drops the price again, etc. Essentially this is how the 1929 market crashed which in part caused the Great Depression.

Short Selling - you sell the stock in advance and must fulfill that order in a future time frame. In essence, you are betting the stock will drop and therefore sell it at a high now and buy it later when it is lower.

Stock Splitting - once any stock’s price gets too high it becomes more difficult for average investors to purchase. Splitting the stock drops the price in half but doubles the number of shares. This is often advantageous to do shortly before offering additional stock because the price tends to bounce much higher if the price is, say, $25 than if it is $125.00 (which would be considered a 5x split).

RRT allows you to have some fun manipulating the stock market. For instance, It is possible to do something like pumping dividends really high to suck the money out of company A, start company B, draw investors into A, lay track with A and run them into the ground. Use the funds in B to sell A short. Then use those proceeds in B to buy A once they hit rock bottom. I do not remember the particulars since I have not played that game in 15 years but when you could pull it off it was like magic and I am sure there are some simple videos out there detailing these types of devious strategies.

Huh. As someone who also gets befuddled at stock mechanics in games, those were helpful, Granath. I know the basic concept behind stock, but I’m terrible at managing it in games. I mean, I can make stuff happen like you describe, but only rarely, and often by accident.

Also, it seems like a lot of this is expressed in Offworld Trading Company, right? That seems like a really good game to play for people who want to wrap their heads around the concept of stock markets.

-Tom

I’m like Hal Holbrook’s character in Wall Street, thinking the stock market should be only for raising capital for productive companies, not even occurring to him to use it for anything else. My idea of investment begins and ends with savings bonds and mutual funds.

It just feels like 2 totally disconnected games going on. On one hand you’re expanding and investing in a company to increase the profits, on the other you’re doing the opposite of that just to shuffle numbers, company health be damned. It doesn’t feel so much an extension of playing a robber baron as it does that I’m playing Wall Street Kid with a model train set running in the background.

I might go try purer train building game like Transport Tycoon or Sid Meier’s Railroads (which hails from that unfortunate time when Sid was pasting his uncanny valley face in every game)…

Better yet with RRT2, you can set the stock market model to easy/medium difficulty if playing a scenario. Or you can just ignore the whole short sell and buying on margin. General rule of thumb with the stock market was to not go too far into personal debt when buying on margin. Should the economy crash into a recession or depression, there will be a margin call no doubt and recovering from debt will be difficult, if not impossible. The guts of the game is the railroad stuff, the stock market is a side adventure. And if the objective says nothing about personal networth or being sole railroad at the end of the given timeframe, all the better because you can then ignore the stock market completely.

Not really. I haven’t played for a while, so maybe they’ve beefed up the corporate finance side, but there’s no shorting or stock splitting (to be honest, I can’t remember shorting in RRT either, but I haven’t played for a very long time).

And this is a good thing for an ordinary person. People without financial knowledge (and indeed many with it) get themselves into all sorts of trouble by chasing high yielding investments or trading “strategies”. Just put the money in some index funds and forget about it.

But that was in many ways what the train barons were doing. All sorts of financial and stock shenanigans.

In RRT2 at least, you don’t need to worry about short selling. Buying on margin is pretty important though. It’s easiest to view it as taking a loan in order to buy stocks. Your “buying power” is an expression of how large a loan the banks will agree to give you. A “margin call” is when that goes negative: you have taken out loans and the bank is no longer confident you can repay them so forces you to sell assets to repay it. Avoid this at all costs, it’s a quick way to bankruptcy.

One primary driver for share price is company revenue, so buying on margin just before a big delivery arrives can be profitable. Share prices drop precipitously when the market conditions change too, so buying on margin during a boom is generally a really bad plan.

The key to achieving personal net worth goals is to find a way to transfer the money your company generates to yourself. You can achieve this in three ways: salary (very slow), dividends (split between all shareholders) and purchasing your shares.
That last one is the reason that buying on margin is so important. You can buy a bunch of shares in another company on margin, then get your company to buy that company out at a higher price per share than you paid for them. Boom, loans repaid and instant personal profit. You generally need to get at least 50% of the shares in the target company (ideally as many as possible) to make this work.
This is, in short, insider trading. And exactly the reason this sort of thing is forbidden nowadays.

It does make me appreciate the movie_Wall Street_ even more, for how it manages to make even a hopeless finance guy like me able to mostly follow what is going on.

(contrasted with the embarrassment that was Wolf of Wall Street, which was so lowbrow that it didn’t even trust its audience with “buy low, sell high”)

http://www.roninsoft.com/wsraider.htm

This game will teach you stock market stuff. I played the hell out of it when I was a kid.

“You start off rich, with up to $1 billion, which is enough to take over one or more decent-sized industrial companies”

ha ha, oh is THAT is the secret?

I’m still waiting for a computer game version of an 18xx game (not counting the old dos 1830). Offworld Trading Company comes close, but it doesn’t have enough stock market shenanigans.

A lot of inflation since the 1985 version I played, I guess.

I mean, who can do anything with only one billion?

My question as someone who just wants to play around and lay track and connect cities & industries with resources without all the stock market manipulation, is what folks’ recommendations are in the train game world?

Sid Meier’s Railroads scratched some of this itch but I’d like to get a little deeper sandbox game than that.

I mean, you’re in a thread for it. Or there’s always TTD.

Especially with how they keep supporting the game and adding new content Railway Empire seems like a pretty decent pick, and is the closest of the newer tycoon games to the Railroad Tycoon style.

If you’re willing to take a, so far fairly good, gamble on something which is still in development via Early Access then Mashinky is an option too. Another option could also be Transport Fever, which also has support for mods so has a bunch of additional user-created content. Two different styles of tycoon game that are closer in parallel to TTD in style than RRT. Or you could just dive straight into behemoth that is OpenTTD.

Pretty sure Mashinky has no AI, or at least it didn’t last time I checked.