Inflation in EU?

[RR1]

Originally Posted by Tango

Here is your answer........a bit long but Very Worth it.

http://video.google.com/videoplay?do...74697167011147

Well I think this guy needs to do some homework. Maybe the oil is where he says it is and Maybe it's not, But if it is what company in their right mind would bring it back to the USA and sell it cheaper then they could sell it for to another country? Their Stockholders would kill them.

It seems to me the Law of Supply and Demand is helping run the price of Oil up. As China, India and Pakistan begin to consume more oil the demand for the limited amount of oil that is produced every day rises thus the price for the oil goes up. If the US did drill in Alaska and off our coast It might help a little but if the price was to drop to far Opec would just cut production to make the price rise back up. I would like to see the US start drilling for more oil in its own areas that would put more people in the US back to work.

As Far as the Ingame inflation I think its mostly being Caused by MA's greed. With the Uber Hofs we are seeing on a Daily basis more players can afford nice weapons,Armor and Faps thus the demand rises and as we all know higher demand = higher price. Now MA loves this because not everyone gets Uber Hofs so some of us have to deposit Large amounts to get these cool items thus MA makes more money.

[Dion Red Strike]

Originally Posted by RR1

But if it is what company in their right mind would bring it back to the USA and sell it cheaper then they could sell it for to another country? Their Stockholders would kill them.

Government > companies

[aridash]

Originally Posted by Elis

1. Does the general RL economy effect economy in EU? (because of Oil?)
2. Is the decline in USD contribute to the general inflation in EU?
3. Is it because of more people joining the game and the share of the "pie" remain the same causes an increase in demand thus causes price increase ?
4. MA's nerfing the drop rate of these items causes the price increase?
5. Or current prices are because of price manipulation by reseller?

1. no.
2. no. at least not to any significant degree, the USD may have declined something like 20% over the last year, so you'd expect that alone to have only a 20% effect on prices. most deposits get burnt in professions so it would have even less effect.
3. yes, partially. though its as much to do with existing people staying around more then newbies who dont need/use high ticket items. also as time goes on more people go for a while then come back and want the same kit they had last time and are willing to pay.
4. yes.
5. yes.

so its a mixed bag of factors. i would guesstimate the proportions of 3, 4, 5 are 15%, 35%, 50%. its not clear cut of course and partly due to feedback loops between those groups, 4 feeds 5 for example and 5 feeds back in to 5 an awful lot. reselling and manipulation are by far the biggest reasons for price inflation, but MA could resolve alot of the issue by letting more stuff drop. they dont because its no in their interests, those deposits keep coming.

Originally Posted by RR1

Well I think this guy needs to do some homework. ... It seems to me the Law of Supply and Demand is helping run the price of Oil up. As China, India and Pakistan begin to consume more oil the demand for the limited amount of oil that is produced every day rises thus the price for the oil goes up.

classic basis for a conspiracy, start with basic facts then mould them to fit your agenda. yes theres crap load of oil in Alaska but its expensive to dig up and poor quality, so the oil companies frankly didnt want to bother in the past. only once above $60-70/bbl do they become economically viable and big companies work to average price over a couple of years before they start to look at spending out on the infrastructure.

As for law of supply and demand, actually its more speculation and directly applicable analogy to EU. the speculators buy up oil futures contracts (that represent only a small proportion of actual production) then raise up the price. as the price goes up the genuine purchasers have to follow the price trend as thats the price being set in the market. this reinforces the speculation and off up it goes. the supply/demand facts are that there is more oil produced to day than consumed. evening accounting for projected growth in consumption, todays (artificially restricted) supply could cope for another year or two. further, demand has not doubled in the last year, nor expected to in the near future, nor has supply declined (bar a few problems in Nigeria) so the past year doubleing in price does not reflect the supply/demand economics. Then there is the wider economics, where at certain prices alternatives become cheaper, which has fed into price rises of foods as some start to use them to manufacture fuel. but they havent actually done so in some areas as infrastructre takes time to build, so its again speculators anticipating a change, while in other areas (like linseed/palm/rapeseed/etc oil where no infrastructre is required) there should have been a downward pressure on oil prices that is not being seen. Oil prices will collapse soon as speculators dump and run. its probably less likly but possible this will happen in EU.

[Hubert Zymp]

1. Does the general RL economy effect economy in EU? (because of Oil?)

To start with... then I come back to the oil... Well, an economy is an economy. In EU, it works just the same as in the real world. In EU, some markets are very liquid (ie, you get an almost instant sale if you price your item according to the market price - Gazzurdite is one example), and niche markets where you have more freedom to set your price (skulls, for example).

Now in real life if some players are loosing their jobs or get higher rents or pay huge bills to fill their tank, it means that they will deposit less (or not at all). In a booming IRL economy, the EU markets should meet more inflation.

2. Is the decline in USD contribute to the general inflation in EU?

Yes. I have read many threads about that... and non-US players (50%+) admit that they deposit more since the Euro is strong. More money ingame means inflation on rare items.

3. Is it because of more people joining the game and the share of the "pie" remain the same causes an increase in demand thus causes price increase ?

A good example: The paladin thigh armor part... very very seldom drops. So price raises... even if this is not an uber item. The pie grows with time... but the player base grows faster for some items... hence inflation

4. MA's nerfing the drop rate of these items causes the price increase?

Well, that I have no clue. Maybe they do so that, as a player, you create a quest for yourself... like hunting calamusoids F to get a paladin tigh...

5. Or current prices are because of price manipulation by reseller?

A reseller can do whatever he wants with a niche market (example: skulls).
Let's face it.

With a strong liquid market, certainly not. At the most, players will overpay +20% in these markets (it is believed that for the IRL oil market, the speculation creates a bracket of 10%-20% around the real price, ie the price given by the market - I read that a few months ago in a good article from Le Monde, that kinda answered some questions I had about that)

For example... despite permanent scammy attemps to raise the price of the engineering skill, this currently fails, 'cause the market does not want to pay more than 10000% - but that market stays strong, diluting the manipulations.

Here is your answer........a bit long but Very Worth it.
http://video.google.com/videoplay?do...74697167011147

Interesting... A bit outdated (80's) but was interesting for me.
That reminded me of an ex-player last year who bought most of the estates on sale, then spammed the forum with messages saying that, like in real life, there was also terrible inflation on estates in Entropia...
... so that's about perception of rarity

[Hubert Zymp]

Ups, and I forgot:

If you are a miner or a crafter, you face more deflation than inflation...

As a crafter, a rare blueprint looses most of the time a lot of value when another one appears in game...

For entry level blueprints and QR blueprints, the price is somewhat stable overall, with some exceptions (a basic filter bp with full QR used to sell for 50 peds not that long ago...)

[Kimmi]

I think that when Mindark have success fully implemented L items, in all the different levels of the player base.

One year from now, I think we will still have inflation, but a more regulated one.. maybe 10% a year...

[Noggin]

Originally Posted by Hubert Zymp

To start with... then I come back to the oil... Well, an economy is an economy. In EU, it works just the same as in the real world. In EU, some markets are very liquid (ie, you get an almost instant sale if you price your item according to the market price - Gazzurdite is one example), and niche markets where you have more freedom to set your price (skulls, for example).

*knocks Hubert on head a couple of times*

You're right - that's kinda the way it is, except the difference between RL and the reality MA gives us, is that EU is completely controlled by a single body. MA could level inflation off completely if they wanted to - but they choose not to.

People easily forget that the way it is in EU is not necessarily the way it has to be, and that MA's balance sheets determine exactly how the economy works. It's not really an economy at all - it's a virtual economy, and that is a very different beast altogether.

I think this is why we have to separate ourselves from our in-world perceptions every once in a while, and ask why we're paying all this money for this game - maybe justify it to ourselves. I'm sure a lot of people don't do that, and that just makes things worse for everyone.

I think MA should have to work a bit more for their cash. They're pretty blazee about it if you ask me. They still think they can do what they want, when they want, and usually, they can!

What happens when a company/organisation has this level of control? Just look at the oil companies now

[Miller]

Originally Posted by Noggin

*knocks Hubert on head a couple of times*

You're right - that's kinda the way it is, except the difference between RL and the reality MA gives us, is that EU is completely controlled by a single body. MA could level inflation off completely if they wanted to - but they choose not to.

People easily forget that the way it is in EU is not necessarily the way it has to be, and that MA's balance sheets determine exactly how the economy works. It's not really an economy at all - it's a virtual economy, and that is a very different beast altogether.

I think this is why we have to separate ourselves from our in-world perceptions every once in a while, and ask why we're paying all this money for this game - maybe justify it to ourselves. I'm sure a lot of people don't do that, and that just makes things worse for everyone.

I think MA should have to work a bit more for their cash. They're pretty blazee about it if you ask me. They still think they can do what they want, when they want, and usually, they can!

What happens when a company/organisation has this level of control? Just look at the oil companies now

You hit the nail on the head there old bean. MA have let the economy get in the in-some-ways-disastrous state it is in and although some differences in inflation are propagated by RL circumstances (it's cheaper for Europeans to deposit now than before etc) none of those influences compare to the affect MA's actions - or lack-thereof - have.

[SpikeBlack]

I've watched some of my vigi armour, bravo and my amps going up in market value for weeks now. I checked the price of my bravo and its +500 for me but for everyone else, it isn't that great a weapon but people might feel the need because of the mob nerfs and the need for longer range tagging. Even vigi is going silly, a lot of the parts of popular armours are massively over priced.

The reason I believe is that there is still demand for UL items but MA don't want us to have them. They're pushing the (L) varieties and make the (UL) drop less and less each week. They seem to have a need to give out +20k ath's every couple of days so it limits the number of higher level items that can be dropped instead of giving out 100x 200ped loots where we could get some reasonable items and so keep their prices at a more reasonable level.

[Sirhc]

Originally Posted by Elis

I've been observing the general trend of the economy in EU and I've notice a general inflation on items in the game. Especially in those rare/uncommon items. My question is :-

1. Does the general RL economy effect economy in EU? (because of Oil?)

I guess like others stated if anything with the price of oil going up people will have less dispossable income to deposit into EU. Companies will not absorb added fuel costs for shipping so pretty much anything you buy will go up in price meaning less cash for entertianment etc etc. Although in that respect entertainment companies will try to maintain profitable levels with less people spending money on entertainment so those who do I would think will pay more for it.

2. Is the decline in USD contribute to the general inflation in EU?

I can't say for sure since inflation has always been present in EU IMHO even when things were not so bad. Sad to say but things always go up in price as demand increases. More demand for oil higher prices more people populating the earth and driving cars the more demand for oil and so on and so forth. The only thing that can stop that viscious circle is more oil or someone finally developes an alternative cheap energy source which lessens the demand for oil.

3. Is it because of more people joining the game and the share of the "pie" remain the same causes an increase in demand thus causes price increase ?

I think this among other things is part of the problem. Demand is high and availability is low seems to always force prices on certain items higher.

4. MA's nerfing the drop rate of these items causes the price increase?

Well MA is in business to make money and they have obvisously found a way to generate more deposits for rare items by making them more rare each year. It may have even suprised them that people would be willing to pay so much for certain items but the formula works so why not continue to make money using that formula? To me its a precarious balancing act they pull off. On one hand they want people to pay a premium for items while on the other hand they need to keep people striving to acquire those items. I would hazard a guess here and say MA is well aware how much certain items are and just how much they affect their bottom dollar if they allow more to show up in loot. (L) has been the driving force behind much of the inflation if you ask me.

4. Or current prices are because of price manipulation by reseller?

Well resellers are just taking advantage of the situation MA has put in place. I am sure there are manipulators out there and I have witnessed it from day one of PE. Buyers are as much to blame as resellers on many occasions and lets face it we are all buyers and resellers in EU there are just varying degrees of each. Basically there are enough shadey resellers and enough buyers with more money that sense that don't help the price situation in EU.

What do you think?

Well I would think someday items would eventually plateau in price but as long as MA can "balance" the system to maximize their profits and people continually pay higher and higher prices it will never stop unless we see a lot of new non (L) items with better stats replacing the old rare items. For now I think MA wants the best of both worlds. It will be interesting to see what happens when CKI and CRD become active though.