Market Discussions

Thanks for the data. A couple of questions: how much invested capital can you get those returns on and how hard was it / how long did it take to work out which markets to trade in?

At first I told myself that I would just drop this because I'm not reading 5 pages of what I assumed would be excessively detailed and verbose marginal reasoning, considering the products of your last efforts. However, after what seems like positive responses from the "peanut gallery of dubious judgment", I figured I'd at least read the first page. Fortunately for me, I didn't even need to get that far.



I have no idea how you consider this a valid framework under which to compare investing. How much time and effort does it take to be able to establish a remotely successful investing strategy for various sums of money? How much do you have to troll this forum to even get in on possibly good investments? How many 100s of hours have you spent reading this forum and talking in channels to learn the who's who and the what's what required to have even a remote chance of not getting taken to the cleaners? To boil this all down to "20 minutes a day" and try to pass that off as a foundational assumption is honestly insulting.

Now, I'm sure you're getting quite frustrated with my coming by and kicking over whatever 5 post monstrosity you've cooked up, but this isn't exactly a matter of high economic science, and I am claiming no special access to the requisite knowledge nor am I expecting some excessively strict formatting. You need to be able to apply some basic neutral reasoning here to make a convincing argument, or you need to stop making them.

You're looking at what outcome you want, then working backwards to determine what initial conditions you will need to achieve your conclusion. And not only are you committing really basic errors of argumentation, you are presenting them in these stomach-churning blocks of text, as if that somehow lends strength to your argument (though I'm sure it does around here where the muppets are easily intellectually intimidated).

I don't feel you're in any way making an honest effort at establishing some clearer understanding of the point of contention. Rather you are spewing some monstrous walls of text with cherry-picked convenient reasoning to satiate the doubts of your mooing followers.

I've already spent more time on this than I can stand to. Barring any good arguments, I doubt I'll respond anymore. If the sheep of this forum want to fall for your next act of intellectual terrorism, then there's nothing I can do to prevent that in the long run, so you can consider my silence as disapproval.

Elise - if you want to claim that there is some huge barrier to entry for successful investing then I look forward to your argument. On past form, though, I expect you will just leave it as an unsupported assertion. Given the frequency with which you pursue such an approach you may want to look at broadening your range of targets for the charge of intellectual terrorism.

@Elise

Since you brought up our previous discussion, and apparently claim some kind of success in kicking over my arguments, I'll post the stuff I typed up last week but didn't post due to connection issues just on the off-chance that you have any coherent response.

That the Institution of Investing Should Die
You had previously stated that the only thing keeping 'this ridiculous institution' going is a few people propping it up to feed their egos and that the only reason legit people get involved is for ego-massaging purposes (post 18 in the previous thread. This formulation clearly implies that there is no financial reason for supporting investing).

However, you did concede that there might be a case 'for capital absorption for the extremely rich' (post 41 where you also repeat the points about honest investees only staying honest for ego driven reasons) and another formulation in post 41 implies that some people may be able to make isk ('I am extremely confident that for the vast majority of people by risk, reward and effort, investing is a terrible way to make money').

Later in that thread you offered a milder form of these latter points when you (wisely) rejected the univeralised argument I offered as an interpretation of your position (post 97 – 'My claim is that it is a comparatively poor way of making isk …' or 'that it is a fundamentally poor way of making money ...'). But your reply in post 97 also makes a vital concession (which, rather ungenerously, you do not explicitly flag). For you now claim that 'Specifically in spite of this fundamental paucity, a small group of people are creating an illusory 'island' of quality investing to serve their own financial and egotistical desires' (my emphasis).

This represents an important departure from your earlier claim that the only reasons involved are egotistical. You now accept that for at least some people there are financial reasons for supporting investing. This point alone seems to be sufficient to undermine your claim that the institution of investing should stop (as well as your claim that it is purely ego driven, to which I will return below).

However, in post 97 you add in a feature that you earlier rejected. In post 43 I argued that the fact that some people who fail to follow good investment strategies lose out is not a good reason for shutting down the institution of investing as a whole, although I did leave open the possibility that a more persuasive argument could be constructed on the basis of the social harm involved in supporting an institution that some people fail to approach rationally and consequently lose out from their involvement. Your response (post 45) was that:



But after accepting that some people do make isk you argued that:

Quote:

[T]he vocality of incestuous institutional authority of this group perverts the impressions of the casual and uninitiated, ultimately to their detriment … You are making money because you are pretty much the cornerstone of this vocal and incestuous institutional authority, and you are propagating this practice because you are a winner both financially and in terms of status. However, this winning comes at the cost of others who would be much better off making money in a myriad other ways. (My emphasis)

(See also the formulation in post 96, first paragraph.)

Since you have now set aside the claim that ego is the [i]only reason for supporting investing and you accept that at least some people can benefit financially, this social harm argument seems to be the only remaining argument for getting rid of investing. If, however, this is just an aside then what precisely are your grounds for agitating for the shutting down of investments?

To summarise:
1) You accept that some people have financial reasons for supporting the idea of investing (and, in parallel, you reject the universalised claim that no-one does).
2) You claim that for most people investing is a fundamentally poor use of their resources but refuse to substantiate this claim (and yes, this is a positive claim so hiding behind the assertion that I'm the only one making such claims does not wash; this is an extraordinarily weak tactic for avoiding supporting anything at all that you say).
3) You claim that perpetuating the investment market incurs significant costs to those who aren't 'winners' at investing.

If these points accurately represent your current position then, as far as I can see, the only potentially compelling argument being offered (as an argument and not an assertion) for closing down the institution of investing is number 3, the argument from social harm, which you had earlier rejected. Leaving aside the question of your views on motivations for the moment, is this a fair characterisation of your current position?

Alternatively, you may have moved away from the strong claim that investing should cease. I note your comment in post 96 that you are not really interested in storming the metaphorical Bastille and your other comments elsewhere to the effect that you don't have a problem with people investing for fun. So it might be that your comments in that thread about letting the institution die were only rhetorical flourishes adding some colour to your more firmly held views about motivations. If this is the case can you signal that clearly so that I can set aside arguments around that issue in any future posts?

It would also be nice if you could explain how some of the following points (including those that follow whatever your answers are to my questions) fit into your narrative:

1) The fact that a number of successful investors don't get involved at all either in issuing debt and repaying it honestly (or with an insincere honesty as you would have it). Flakeys comes to mind most obviously here as probably the most prolific successful MD investor in the last two years (Taram was another example when he was active on MD). These people also tend not to get involved in discussions such as this one either and can hardly be accused of providing the propaganda that props up the system.

2) The fact that there is actually a temporal disjunction between my investing success, most of which occurred in my first year in eve (I have only made a handful of investments this year), and my alleged 'position of authority' as the lynchpin of the financial Illuminati, which I assume is a more recent development. Given this sequence it seems hard to see how the former can follow from the latter.

3) Obviously you don't hold me responsible for starting the institution of investing (I hope) as I didn't begin playing until late August 2009. Do you honestly think that if I were to stop playing (or posting) tomorrow that this would have any significant effect on the volume of investing on MD? If not, then how do you sustain the claim that my influence props up the institution? I would be willing to take a 20bil bet (secured by any mutually acceptable third party) that if I stopped posting for six months (I have a lot of real life work to do!) there would be very little change to the institution of investing on MD (I'm sure we can work out mutually agreeable conditions for assessing change in order to give you a chance to test your case here).

4) This stuff about a quasi-pyramid scheme I find very hard to swallow as I don't see how the profits of successful investors are in any significant way dependent on unsuccessful investors losing isk. It's worth emphasising that the vast majority of the isk lost on MD is lost to a very small number of big scams. Of the ten scams/defaults in my sample, those from Bad Bobby, Lui and Curzon account for c. 95% of total MD investment losses in the 12 months covered (c. 500bil vs a combined total of under 20bil for all the others combined). In what way are my (or any one else's) successful investments in that period supposed to have benefited from these losses, or indeed the previous huge losses in the sequence of bank scams that played a parallel role in the immediately preceding years (as far as I'm aware there was no huge sequence of 10-50bil scams to balance out the trillions lost in five or six massive failures)? What are your reasons for supposing that my successful investments required these huge failures? Or, indeed, any of the smaller scams?

The quasi-pyramid scheme criticism differs quite a bit from the social harm criticism. The social harm critique would be that people incidentally take losses because they are given the opportunity to make mistakes simply by the presence of an investment market. But the pyramid scheme criticism makes a different claim – that successful investing in some way relies on persuading people to get involved and fail. Whilst I think that the social harm approach might have some legs I'm really struggling to see the grounds for the pyramid scheme critique unless the thought is that it's necessary for people to lose isk in order to keep risk high and thus boost rates of return. But I'm pretty confident that you could get rid of all the big scams and the vast majority of investment losses without driving down the rates on the majority of offerings since the massive damage has historically been done by those paying out the lowest rates. I could make a range of other counter-claims relative to this point but to avoid bloating an already lengthy sequence of posts I'll wait for your reply before offering much else here.

5) Your claim about the extent of my influence seems, on the whole, to fit the historical data rather poorly. The vast majority of my posts on MD have had nothing to do with the viability of the institution of investing (nor has the majority of my 'hundreds of hours' of involvement with the forum had anything to do with making investment decisions; most of it, by far, has been spent in long-winded arguments such as this one). I have very rarely made posts in support of any given investment (the One Stop bond and my comments in Mickov's thread a few days ago being a couple of exceptions but I struggle to think of any others) and when I have I have always offered reasoned arguments rather than reputation-based claims. My concerns about the dangers of certain investments seem to have little effect as well. When I publicly pulled my investment from Machete Visor's bond a while back no one else followed me out, iirc, and the remaining investors lost a fair chunk when he scammed. When I argued against Ray's imposition of arbitrary changes to the terms and conditions for AATP I received little support (if memory serves you were amongst the clear majority who disagreed with me). Similarly, my early campaign to get people to not invest in anyone who offered active support to scammers (primarily aimed at Cosmoray's support for Riethe) was also an abject failure. My comments and concerns about BSAC's lack of transparency seem to have had little more than a cosmetic effect on that venture and the expansions it was engaged in at the time. All this suggests to me that my direct influence on the actions of MD investors is pretty minimal.

One last point re: you response to this thread. You claim to be 'honestly insulted' by the supposition that one can successfully invest with only 20 minutes available each day. If you had honestly engaged rather than jumping to conclusions you would have seen that the whole purpose of this thread is to try to determine whether this is, in fact possible. It is not a founding assumption but, rather, the question at issue. My intention is to test the hypothesis by seeing whether there are any mechanically applicable rules that may help filter out the majority of scams WITHOUT the need for significant background knowledge. Putting forward and testing a positive claim is not an intellectually biased approach but is actually quite a historically respectable and productive one. The important thing is that one be willing to admit to defeat if the data falsifies the proposition being tested. So, again, I invite you to show that such a set of rules cannot be established as this would be a quicker route than testing a range of rule-sets only to find that none of them work adequately.

any investor with 10bil could automatically get a collateral secured interest rate from quite a number of options in 20 minutes.


tring to make RAW32 seem like the last person standing up for MD investment is epic phail.


RAW there was a bond which "tanaka kharn"( i think) filled that went bust i believe this was for 4 billion. there was also tutski's bond as mentioned already and also brock who scammed for 30-40bil depending on how yopu look at it. the scam i believe was for 30bil, but because his shares were diluted in the BSAC exchange lots more isk was lost.

those are the 2-3 i remember most, but as such things are in MD those who are scammed aren't very willing to come out and say it.


also just remember jordus melicia. scammed for 1-2 bil and also stole POS mods from stormhawk or storm shadow?memory is sketchy on details but he definately scammed. also then proceeded to corp kill a deadspace fit carebear for another bil or so.

Throughout this entire process I've been careful to avoid getting dragged into formulating a detailed argument against investing because I do not think it is necessary in the minds of most people; the only necessity being to counter the superficially seductive arguments you have been putting forward for investing. The consequence is that I have been alluding to concepts that I have not followed up in detail. This lazy arguing has produced seeming inconsistencies which you have, unsurprisingly considering your available faculties, noticed. I will endeavor, as I have been, to clarify my argument once again.

By "fundamental paucity", and whatever other terms I've used, I am describing the core idea of strangers coordinating on the MD forum to make money, through both borrowing and lending. This is an actual "state of nature" where eve pilots once came to the MD forum in their "natural state" without any prior conventions or norms for investing beyond those already established in actual gameplay.

The argument I have been making from the beginning is that this "investing in its most basic and fundamental form" is a poor way of making money for both investors and borrowers. Again, this is where I should sit down and discuss the likely rates of failure, the costs of identifying legitimate offers, the costs of signaling legitimacy, the range of capital need where one would actually need to go public (go beyond friends and acquaintances), the higher failure rates of such large projects, on and on and on. I won't, I refuse; I've wasted enough time on this as it is. My proposition is that this natural state of MD did once exist and it was an objectively ****** way of making money for the vast majority of players.

In spite of this, people did make legitimate offers, not because it was a good way of making money, but because it got them into the rationality-defying, good guys club (hence my comments about ego). This club has been the basis of everything that has happened on here. Whereas a rational pilot would originally look at the objective idea of giving money to strangers on a forum and just snort in derision (and the vast majority of players still do), this little circlejerk club created the illusion that somehow this sensible reaction to the idea of investing was not actually true. Now they may have made money, but that was never the actual goal, there being numerous better ways to make money, and that's not saying some didn't make better money than they could have other ways, but for the vast majority it was (and still is) the draw of the cool club.

Surrounding this tiny island of legitimate offers is an endless sea of scams, drawn to the flame of money changing hands like a stomach-turning cloud of greedy moths. In this environment, a few people who understand the subtleties of identifying the cool club from the scammers can actually make money (see you example of flakeys), but this comes from a significant investment of time and effort, and there is a very limited pool that these people can draw from. For others it was never about the money, it was about the ego, and it still is.

Ironically, those who create this false illusion of legitimacy and profit from it in terms of both money and status create the sea of greedy scamming that surrounds them and draws in the uninitiated and unprepared by inadvertently (or perhaps not so inadvertently) deceiving outsiders about what is really going on. The scamming feeds the desire and "purpose" of the cool kids club, the cool kids club feeds the illusion that investing is a good way to make money for the average player, the illusion feeds the scammers, and the whole time the little guy gets suckered into scams while the few "legitimate" offers that draw them get scooped up by the few initiated.

Now, you suggested that this is a social good argument. It is not. It is an argument pointing out the hypocrisy of a cool kids club, whose entrance qualifier is being "good" for no reason, creating the very sea of "bad" against which they identify themselves, all to feed their own egos and in some cases enrich themselves. Furthermore, the true nature of this institution has become ever more apparent as the time since its founding has passed with increasing examples of its fundamental failure. It has now gotten to the point where only a few hangers on prop it up in spite of the obvious perversity because they cannot let go of being King.

Obviously, depending on which T2 item(s) you choose to produce each month will determine the amount of capital absorption and the return percentage. Not all T2 items require the same construction materials, not all T2 items have the same Invention time, and not all T2 items can be manufactured in the same amount of time. In fact, some T2 items are not even profitable unless you utilize buy orders to procure construction materials and use sell orders to sell the final products.

That having been said, I am a T2 Producer, so I can speak with confidence when I say that there are products out there that can be produced by an alt (or two) can result in a fairly nice profit margin. For example, using 3 toons, a medium POS, and 10 T1 BPOs, I can easily turn 2.515 billion ISK into 4.375 billion ISK (or more) every 27 days, which is approximately 81% profit margin. The 2.515 billion ISK figure already includes the cost to fuel the POS and the cost of the Datacores needed for the Invention step. I do not waste time mining ICE and doing PI to create my own POS fuel, but rather just send a mail to Lady Patricia and she brings me 28 days of POS fuel whenever I need for approximately 165 million ISK. I log my T2 production alts to queue up a batch of production jobs twice per day, so the amount of 'time spent actually doing this is a very small amount of time. In addition, I do not sell via sell orders, and do not produce the R.A.M./Tech1/component items needed for production. I simply buy the exact items needed for production (and the exact quantities), produce a predetermined quantity of the T2 item, and sell to existing buy orders.

As for the size of the operation, it is limited by the number of real life people you have participating. As you are comparing MD Investing with other potential activities, I chose to show an example with 3 toons which is an amount that can easily be operated by a single person. Depending on your level of commitment, you could utilize more or less toons for T2 production and make more or less profit per month. The minimum number of toons needed for a efficient T2 production operation would be two (2) toons in my opinion. You could technically use only one toon, but whenever your toon was doing invention jobs, then he/she could not be doing copy jobs, and hence it would not be a EFFICIENT T2 production operation. Using two toons allows a player to constantly have up to 11 copy jobs and 11 invention jobs, in addition to up to 22 Manufacturing jobs running at all times. You could also choose to utilize more then 3 toons, but you will eventually run into the problem of not having any more available copy/invention slots (which can be remedied by adding more POS's) and/or reach a saturation point where one person is not be able to log on, queue up jobs, and log off fast enough that additional toons would increase the amount of profit per month. From personal experience, about the highest number of toons I (one person) could use before reaching the saturation point would be about 5-6 toons. Using 5 toons, you could easily turn 4.5-7 billion ISK into 8.75-13 billion ISK every 28 days or so provided the market could handle that quantity of the item without getting flooded.

Using 3 toons and rotating between selling in Jita, Ren/Hek, and Amarr, the market can fairly easily absorb the quantity of the T2 item I produce without getting flooded. If I ever feel the market is getting a bit saturated, I can simply switch over to a different T2 item (previously-researched of course) for a month or two and give the market a chance to recover.

I am not going to say that T2 production is better, or worse, than MD Investing. What I will say would be that both T2 production and MD Investing can both be profitable with relatively small amounts of effort each month and that both activities are susceptible to a variety of risks that can result in a loss. In addition, depending on the amount of money you have available to use for investing, doing other activities may make you more or less profit per month when compared to MD investing. For example, using my initial T2 production numbers above, any MD investment (or portfolio of investments) that earn you less than 2 billion ISK in profit per month after subtracting any losses due to scams/failures would be less beneficial than simply doing T2 production yourself. On the flip side, any investment (or portfolio of investments) that earn you more than 2 billion ISK in profit per month would be better than doing T2 production.

For both Elise and RAW: I admit to scanning the long posts, but the general gist of the matter seems to be if 'viable' investing is dead (or, if it was ever alive in the first place). My own take is that it really does not matter either way. As long as the person involved enjoys what they're doing, the amount of time (and money) invested/won/lost is moot.

This is a game, albeit a very complicated and harsh one. The fact that I've kept myself above water financially (without any severe reaching for PLEX conversion) for over two years is enough success to me, and its been through just about everything short of major (POS-based) Industry work. And from a US$ perspective, I've getting a lot more enjoyment out of each US$ than I did for SL, Uru, or even Travian.




Out of curiosity, would you consider investing with a RL friend safer? I've been making the argument that the 'smaller' Industry money can easily be scaled if one or two others join in and share their resources. That requires trust, as stated, which I've always felt is best done among friends - preferably from RL, or gained that way later through Eve.

Note I define 'RL friend' as someone that you know some of their personal info, usually including RL name and some other data like phone, address etc. The RL friend who got me into Eve in the first place is no longer playing, but his initial goodwill and sharing of resources (through corp structure) kept me moving through the early months of the game.