16 replies to this topic

[Llaaki]

I have a number of serious problems with Guild Wars 2 and hope to explain it adequately.

First, content unlockable by gems is not even close to being worth the price to purchase in real money. ArenaNet has not done a thing to fix this. The fact that Black Lion's chests are virtually worthless highlights this point. Each should contain content worth about $1 each in real money.

Second, the exchange rate of gold for gems, which provide only miniscule added content, shows the value of gold is steadily depreciating.

Third, in-game rewards for completing events, quests, stories and so on, remains fixed while gold continues to devalue.

Forth, crafted items are sold at less than their fair material costs making the sale of crafted items prohibitive. This may be because players are foolish, or because hacked accounts are being liquidated fast. Either way it discourages both crafting and trade.

Fifth, extensive farming and/or botting has created a vast surplus of some mob drops, materials, and junk items. That surplus may make crafting less expensive but it also drives players away from playing the game post-80. Low value for items = low interest in gathering unless you are a professional farmer. A reason there are vast supplies of some items in the trading post could be because the desire to consume them is very low - again, driven by peaked demand for craft results.

Sixth, item speculators do manipulate prices by creating artificial demand or artificial surplus. The amounts of items some people on this forum discuss parallels the trade in derivatives in real life. The same mechanisms at work that caused the flash-crash in the stock market are magnified in ArenaNet's poorly regulated financial system.


This game is about 2 months old. Its economy has evolved rapidly but actions to protect and regulate it have not kept pace. Feel free to blast me about these comments but I stand by them. The conversion between real money and the three main game currencies (gems, gold, and karma) is badly broken. In my opinion, karma is the only stable major currency at this time. Gold/silver/copper continues to fall in value and gems are a joke because of their fixed exchange rate to real money. In fact, I believe gems should not be sold directly for real money. They should be discontinued or made purchaseable only with karma. Save the gem idea for serious content expansion such as opening a new area, a new profession, or buying items with higher attributes than exotic 80.

[Midnight_Tea]

I gotta say, that was a rather convincing troll post. But it kinda fell apart by the point you brought up karma. Let's see if you still get some entertaining responses though.

Edited by Midnight_Tea, 31 October 2012 - 10:27 PM.

[RabidusIncendia]

I'll bite.

1)  They're actually worth a lot if you buy a lot of gem related stuff.  Someone did the math, and you get something like triple your value back if they were items you would've bought.  Only these people should buy them.

2)  No MMO has ever had deflation afaik.

3) Consider that the rewards increase would cause gold to further devalue

4) You're about 4 months too late to notice: http://www.guildwars...se#entry1802310

5)  Agreed here.  I don't know why arenanet always places high rewards on trash mobs and low rewards on major events and group activities.

6)  Not a problem.  There's a few fake bubbles, but more often than not the advise given is sound.  I told people to buy chests at launch when they were 3 copper.  Anyone who did made 10s of gold before the holiday.  I'm telling people to buy corn a few days ago:  It is now permanently going up: You can quote me that it will never go below the 5 it once was.

Midnight_Tea, on 31 October 2012 - 10:27 PM, said:

I gotta say, that was a rather convincing troll post. But it kinda fell apart by the point you brought up karma. Let's see if you still get some entertaining responses though.

Not sure what you mean here.  Karma may be worthless now but it has the potential to be the most stable currency when arenanet actually makes karma worthwhile for stuff other than legenedaries.

Edited by RabidusIncendia, 31 October 2012 - 10:50 PM.

[Lasareth]

To balance inflation requires an effective in-game gold sink. Whether the 10+5% tax on all trading post items (let's call map travel fees irrelevant at this point) is good enough is something that we'll observe over time. The major threat to economic balance, like in every MMO since the dawn of time, is the impact of RMT (besides our cherished cash-for-diamonds system).

Crafting is useless though and this is a different beast altogether. At this point unless they're going to raise the cap and make 401+ crafts difficult to achieve, you can't really revamp the system. The problem currently is that everyone's 400 (or can easily be) and regardless of the price of mats, crafts aren't exclusive enough to profit from. Incorporation of a chance at "high quality" (i.e. getting an exotic when you're crafting a rare) items might make having a craft at 400 less useless, among other things.

ANet's income from microtransactions is so humongous at this point that you'd be crazy to think they'd switch from money-to-gems to karma-to-gems at any point in the near future.

I expect that if inflation becomes bad enough, there will be a reactive decision from the developers to quell the source (again, most likely RMT). In that case, you can still come out on top by liquidating items at the peak of inflation and saving the cash til it's taken care of.

[Llaaki]

RabidusIncendia, you do have a very good understanding of the economy. Here is my reply to your counter-points.

1. Purchase of the game itself is $60 USD versus $10 worth of gems buys you what? I agree some people find it easier to justify the additional real money expense than I.

2. Inflation = devaluation of the currency with respect to a unit of labor x productivity adjustment. Karma never devalues because there is no exchange and all prices for items are fixed. Gold is completely free to adjust according to supply/demand but gems are pinned to real money on one side and gold prices on the other.

3. I do not argue that point or even suggest increasing event payout for the very reason you cite.

4. Very good point. Crafting has been a problem for some time and nothing effective has been done to fix it.

5. Your point is a little sideways to mine but equally valid. ArenaNet should be working to keep people out in the maps playing together. I have noticed map population drop as people level out at 80 but expected that.

6. I have no problem with "bubbles" in the market as long as they pop. If they to not pop, they are not bubbles. Case in point is gem price in terms of gold. Gems have not been going up in value. Their price is fixed as a consumable item is tied to real money (even if I do not like the "exchange rate" for real money). What this means is gold is an anti-bubble - it is imploding in value within the game - but that is all beside my original, sixth point: speculation on a grand scale can drive prices well above, or below, fair value. Candy corn experienced a massive surplus on the TP before people understood its true value in craft recipes because it was so plentiful. If ArenaNet wanted, they could adjust individual drop rate by account inventory to put a brake on over-supply. They can do the same for botters and farmers. Are they tweaking drop rates based on behavior? Is it working? I do not have those answers. I do, however, have butter and candy corn.


Lasareth, you have very good points but your last comment about liquidating at the peak of inflation will not work well in Guild Wars 2. There is no inflation to take advantage of. Most items are gaining value with respect to gold; that is, it takes less gold to purchase those items as time passes so, if the economy were based on gold, the economy would be deflating. However, the economy is really based upon gems and karma. Gems are tied to real money and Karma, along with pvp and dungeon tokens, is tied to player event rewards and is only spendable on specific, fixed-price items. Those two currencies are forcing the value of gold down because gold is the only currency completely free to move. Aside from special rare drops in demand for legendary items and seasonal drops like candy corn, there is very little inflation to take advantage of. Converting gold to gems merely reduces exposure to gold's devaluation, though it carries risk because gems are dangerously over-valued in terms of real money. ArenaNet may enjoy the income but without significant content sale may be unsustainable long-term. Maybe they will consider auctioning gems for real money to let the exchange rate float in a more controlled fashion.

Edited by Llaaki, 01 November 2012 - 12:01 AM.

[Minimal DJ]

i'm sure ToT bags will climb 60c+ in the next weekend, get em while they're hot

[Sinnacle]

You wouldn't happen to be this same guy would you?

https://forum-en.gui...irst#post601913

[Duplicated]

Sinnacle, on 01 November 2012 - 03:47 AM, said:

You wouldn't happen to be this same guy would you?

https://forum-en.gui...irst#post601913

Do you even need to ask lol? The first sentence, in addition to the topic header, is identical.

[Pysgasm]

John Smith already answered all your questions on the official forum so not sure why you feel the need to repost it here.

Edited by Pysgasm, 01 November 2012 - 01:33 PM.

[Nephele]

Pysgasm, on 01 November 2012 - 01:33 PM, said:

John Smith already answered all your questions on the official forum so not sure why you feel the need to repost it here.

Because he got shut down and now he's looking for an audience that might agree with him.

[Duplicated]

Nephele, on 01 November 2012 - 01:41 PM, said:

Because he got shut down and now he's looking for an audience that might agree with him.

Not like he would find anyone to sympathize with his opinions here anyway, at least not in this subforum.

[Xanarot]

Basicly, you're saying that Anet managed to create a game, where the economy works identical to the real world? I say kudo's to them on such an amazing achievement!

1) You never get what you pay for IRL or in the game. Simply because if you get what you pay for, nobody is making a profit. So working as intended imho.

2) Called inflation, look it up, its actually enforced in the real world as well.

3) Again, called inflation, normal real-world behavior. nothing weird at all.

4) Again, standard real-world behavior. You can never make something for above the costprice yourself either. if such a thing existed everybody would make it (guaranteed profit = free cash = crashing economy). Only those that do it profesionally (buy low, sell high, mass production etc) manage to squeeze out some profit.

5) Again, regular market behavior in the real world being copied. Try following stuff like the oil price for a change, works almost identical (low/high demand, low/high supply, whats in the news, etc).

6) See most of the above, basic real world behavior again called speculating/derivatives etc. Even you mention a real-world thing happening that reflects it!


So again, kudo's to anet for making a game where the economy is working so flawlessy identical to the real world economics.

[Pipples]

Llaaki, on 31 October 2012 - 10:21 PM, said:

First, content unlockable by gems is not even close to being worth the price to purchase in real money.

Gear != content. Zones, dungeons, quests, etc = content.

Llaaki, on 31 October 2012 - 10:21 PM, said:

Forth, crafted items are sold at less than their fair material costs making the sale of crafted items prohibitive. This may be because players are foolish, or because hacked accounts are being liquidated fast. Either way it discourages both crafting and trade.

Or people are selling crafted items they have left over after leveling crafting for experience, and they simply want to recoup some of this cost. Since exotics are available at pretty much no cost, selling items with the same stats at high prices would be stupid

Llaaki, on 31 October 2012 - 10:21 PM, said:

Sixth, item speculators do manipulate prices by creating artificial demand or artificial surplus. The amounts of items some people on this forum discuss parallels the trade in derivatives in real life. The same mechanisms at work that caused the flash-crash in the stock market are magnified in ArenaNet's poorly regulated financial system.

And economists have been watching MMO economies since EQ1, and it's been flat-out stated that a MMO economy is a good way to observe and study markets because it mirrors real life so closely but is small enough to be able to study reliably. The difference is, if a MMO economy crashes, people won't lose their homes.

[Naevius]

To summarize:

Items are worth what people will pay for them. No more, no less.

All the behaviors being complained about occur in the real world as well.

Harden up.

[Bonja]

to be fair the conversion rates on gold r like that to stop flooding of the market by gold buyers and to regulate it to an extent
the botting is a problem which has caused prices to drop but the constant farming at orr and many other areas also has caused this
crafting can work but people r dropping the prices as they dont understand tax systems and as the forge is being used more and more as people look for profits by combining rares and quickly selling the exotics
you are right in some aspects but its a game not real life

[okwtf8288]

RabidusIncendia, on 31 October 2012 - 10:46 PM, said:

I'll bite.

1)  They're actually worth a lot if you buy a lot of gem related stuff.  Someone did the math, and you get something like triple your value back if they were items you would've bought.  Only these people should buy them.

2)  No MMO has ever had deflation afaik.

3) Consider that the rewards increase would cause gold to further devalue

4) You're about 4 months too late to notice: http://www.guildwars...se#entry1802310

5)  Agreed here.  I don't know why arenanet always places high rewards on trash mobs and low rewards on major events and group activities.

6)  Not a problem.  There's a few fake bubbles, but more often than not the advise given is sound.  I told people to buy chests at launch when they were 3 copper.  Anyone who did made 10s of gold before the holiday.  I'm telling people to buy corn a few days ago:  It is now permanently going up: You can quote me that it will never go below the 5 it once was.



Not sure what you mean here.  Karma may be worthless now but it has the potential to be the most stable currency when arenanet actually makes karma worthwhile for stuff other than legenedaries.

Candy corn are currently 3 copper each. don't get *y, no one can say never on the price of an item unless they have enough money to manipulate it. and you obviously don't.

[RabidusIncendia]

Heh, yeah that was unpredicted .  Still buying it, though.