Originally by: Lexander Morinex

---

Originally by: Kazzac Elentria

---

I think what you're asking for is the academic question of "At what point will ebank control so much isk that there are no more investment opportunities"

I think over half of the isk in game would be required before you hit that limit.

---

I am not terribly concerned about that. If you put your money into any bank, you are saying 'I will give you my money in exchange for a return'. Otherwise you can keep your own money and do with it as you will. Now, every player in the game has physical limits on how much they themselves can manage. Eventually you have to either trust other players and build a large organization containing many people, or you have to invest in somebody else. That is what you are doing when you give your money to EBank instead of spending it yourself on something. Now, EBank can only produce so much out of personal efforts, and eventually they have to invest in other companies. I will stipulate that all members of EBank are completely trustworthy. But they do have to do business with other people, and other people are not as trustworthy. That is a concern of mine.

I have watched this kind of behavior in the real world markets for years. I worked in the energy industry and I saw all kinds of interesting attempts to grow the company. Eventually the pressure to grow resulted in some tricky accounting that eventually turned into 'Let us hide our loans through complex booking tricks' and 'Let us manipulate the moronic laws in California to make money selling electricity'.

Then I got to watch the joyous buildup of housing prices. As all the 'good buyers' started to dry up it became 'let us pick bad buyers, and protect ourselves through complex splitting of the risk'. It didn't matter that the sum total of the loans were a bad bet. People did the funny money math (which is made worse by the ways to manipulate things with GAAP) and came up with a way to justify it to support growth.

I think the current IPO market is showing too much weakness for it to be a viable source of revenue. I recognize that companies such as EBank have other revenue streams and they may clearly support their steady growth. But don't take it for granted that it will.

It is a lot like playing Poker for money. I have just enough discipline and skill to be a steady player at $3/$6 Limit and $25-$50 No-Limit. The trick to making money at the Poker table is to be selective enough to dodge the bad bets and pick the good ones. The sad truth is the whole game has a negative expectation for the table and only a few people can make money.

I have seen how fast 'decent' IPO's fill because the demand far exceeds the supply. People are willing to make some pretty extravagant bets in the desperate desire to find something to do with all that money they are having a hard time using. That gets worse when you are an investment firm and have to keep your money in play constantly grinding out money.

- Lexander Morinex

---

Originally by: Kazzac Elentria

---

I think we're chasing our tails around the same pole here.

If at such time Ebank reaches a point where investments no longer acheive acceptable returns for the liability they have bought up you can likely expect returns to either diminish, caps placed on accounts, etc..

This topic came up in the last ebank statement thread.

---

Originally by: Lexander Morinex

---

Originally by: Kazzac Elentria

---

I think we're chasing our tails around the same pole here.

If at such time Ebank reaches a point where investments no longer acheive acceptable returns for the liability they have bought up you can likely expect returns to either diminish, caps placed on accounts, etc..

This topic came up in the last ebank statement thread.

---

Very likely that you are right. I tend to repeat myself without recognizing that I am doing so. And today is kind of quirky since I have a lot of family in Houston today so I am distracted.

- Lexander Morinex

---