Market Discussions

The NPC seeded trade items are so peripheral to the game economy that most people have probably forgotten they exist. The labor issue is factored into the various tiny costs of production and the like (e.g. it costs 2-6 million ISK in NPC station fees to build a Phobos hull in a station; part of that ISK pays for the scientists and factory workers involved in the job).

As for the Blackbird oversupply - EVE's entire economy is based upon overproduction. If I put my mind to it and had the capital, I could create well over a thousand of those per week on one character and over fifteen thousand if I put up a POS and used six characters to build them. All tech 1 goods other than capital ships are in extreme oversupply, and many tech 2 goods are the same.

You do not need to "start" with npc items just because you are new and have few isk.

When I returned to EVE last summer, I had forgotten my password and started a new character. I made 10 million isk from the 5000 starting isk in a few days, by trading in some dropped modules and player made T1 modules.

I am assuming you have many millions of isk already. It is perfectly possible for you to find obscure T1 modules that you can buy for 1 million isk and sell for 1.5 or even 2 million isk. And soon you will have billions.

I am not sure I follow you.

EvE's entire economy is (mostly) based on demand and supply, overproduction is a feeing, no, a "sentiment" (I'll expand on this later) of yours.

The ratio between amount of supply and demand is going to form price. Producing more just makes prices drop.
The real overproduction happens way, way later than this.

As you increase production, price just keeps going down, until it eventually meets the infamous "production cost". But is it "overproduction"? Nope. What happens in a realistic market is that there's an usually deep buried "break even" point. But it's very hard to get there, almost "asymptotically hard".
If a supply is so abundant that prices drop to production cost, the next step is not a catastrophe. Maybe it'd be in RL (workers getting fired and whatsnot). What happens instead, is that "production cost" just changes. The next step is... makers see their profit so low that stop buying minerals. Who wants to really dig deep about further involved mechanics, feel free to look for "price elasticity of demand / supply".

In few words, Blackbird makers would start dropping their mineral purchases (assuming they don't find other profitable T1 markets). This leads to minerals demand to drop and this begins to pressure on the minerals prices themselves.
Have enough people quit buying minerals (happens during certain seasons of the year) and minerals prices will tank. So, we did not really see "oversupply" but the "built in" markets self optimization and self healing in action.

What happens next? That in a free market, minerals have a production cost (formed by a lot of factors including buying mining ship hulls, insurance if any, fittings etc. etc.) that dictate the true break even. In fact, the prices we usually see are this cost plus the plusvalence miners want to do the job. But plusvalence is not an hard coded value. It's just another demand and supply governed number, if demand is strong then miners will ask for more than when supply is overhelming. The sum of perceived rewards and market actors expectations) is called "market sentiment" and unlike yours, collective sentiment has strong feedback on price.

That is the whole EVE markets are a pyramid at the base of which lie these true costs. Until price won't meet such costs (and sometimes for longer than that), price may drop freely without talking of "overproduction". The break even cost is possibly in the region of 1 ISK per Tritanium unit (it's an indicative number), so, before getting down there, we really have to produce a LOT.
Moreover, as we approach such break even thresold, miners would begin stopping their mining operations (= less supply = price rises = market self healing), seen as way too unrewarding. Thus, 1 ISK pu break even sees an additional "glass barrier" above it, or "support", measured by miners expected reward elasticity.

End result: before overproduction really happens, we really, REALLY have to be in a disaster scenario.

I kind of wish they would significantly nerf production times across the board.

Its silly that with one mediocrely skilled industrial character I could meet the entire supply for a common T1 item.

That's a very specific situation where the markets radically shifted minerals requirements.

Even then, I doubt any of those "overproduced ships" had been sold for below the miners break even in its minerals constituents.

Even this rare case has been covered, by "Until price won't meet such costs (and sometimes for longer than that),"

The only way for the EVE economy to 'improve' is for CCP to create peace time economies that don't revolve around ISK sinks alone. When that day comes, EVE will truly become more than a 'blow stuff up' game.

Wait a minute... You're saying people actually build T1 ships?

So strange, I've sold thousands of them and never once considered building one.