*Iâ€™m running into debt, how do I stop loosing money?
While this is a complex question with many answers, I will try and detail some of the basics, starting with the reports players have at their disposal. The first panel of the Treasury department provides you with the basic information on what you can expect your economy to do. For a clearer picture we are looking at the value in the Daily format. The first financial estimates are the daily income and expenses. Like any economy, the principle is to get more money coming in than is going out. The difference between the income and expenses will either be a surplus (in yellow) or a deficit (in red). A surplus would add to the treasury while a deficit would take away from the treasury. In this example the player can expect a daily loss of 517M based on current spending levels not counting trade income. We will discuss trade balances further on.
Income and expenses are generated from a variety of places. Currently we can see in the second panel that tax income is 1.6M daily. While this is a substantial portion of the daily income, this is not all of it. To see a further breakdown of income we go to the third panel Review Income found in the Budget Reports.
The majority of the entries seen here are individual tax types. Raising tax rates can increase tax income. This income is tied directly to the number of people in your region and the GDP/c of the region. As these increase, tax income will also increase.
The other major portion of regional income is generated through domestic sales. This is generated when selling commodities such as food and water to your population at a markup. If the markup or quantity of goods is increased, greater revenue will be generated.
A short-term solution for income can also be the sale of military units or commodities, but this falls outside of the budget since these are one-time sources. Issuing bonds is another solution if credit rates permit but this will also generate expenses in the form of interest payments
While increasing income is a common solution to avoid debt, decreasing expenses is sometimes more effective. To view a breakdown of expenses we go to the third panel Review Expenses found in the Budget Reports
As can be seen here, the expenses come from many areas. Most expenses can be reduced but each will have an effect. Military Spending can be reduced to save money but this will impact unit performance. Unit Building can be decreased by reduced production of units. Preparedness relates directly to the DEFCON level and is often quite expensive but a higher DEFCON has advantages in unit production, unit efficiency and research. Research spending can also impact heavily on the economy as seen here. In this case, a 60% reduction in research spending alone would save roughly 600M and take the budget from a deficit to a surplus.
The principal is essentially to evaluate each expense listed here and decide where funding can be cut. Things like Construction and Production can be seen as investments since they provide new industries or commodities to be sold and exported. Expenses such as Interest or Maintenance will simply cost money while being difficult to reduce. Social Spending and Research are often the most fluid, able to be changed according to economic conditions.
- Expenses shown in red on the Detailed Expense Summary are limited by a lack of funds. When funds are available spending in this areas will increase to the budgeted amounts. To see these values, view the Detailed Budget Summary
If the financial estimates are showing a surplus but the treasury is still decreasing, the cause will usually be a trade deficit. The trade income is reported in two ways on the first panel. First is the Budgeted Daily Trade. This value works as an average expected gain or loss against the playerâ€™s treasury. Second is the Previous Day Trade. This is, as it would suggest, the revenue gained or lost at the previous day end from export and import of goods. If all trade was stable the two values would be identical but trade is a fluid thing. Some days the player will sell off a large stock of goods, others times the player may chose to live off existing stock.
While budgeted trade can be used in most cases as a guide for the â€œaverageâ€ dayâ€™s sale, it should be noted that the estimate is based on a modest markup of the product. If a commodity is being sold notably above average, the trade income will be consistently higher. If pricing is below average, players may see a consistent trade deficit for the previous day despite a budgeted trade surplus.
By combining these elements, players should be able to determine how to control their economy to at least remain in a stable economic situation, even when it is not a very strong economy.
The trade income is reported in two ways. First is the Budgeted Daily Trade. This value works as an average expected gain or loss against the playerâ€™s treasury. Second is the Previous Day Trade. This is, as it would suggest, the revenue gained or lost at the previous day end from export and import of goods. If all trade was stable the two values would be identical but trade is a fluid thing. Some days players will sell off a large stock of goods, others they will live off existing stock. Combined with the surplus or deficit this will match the direction the treasury is moving.