Market Discussions

Again CCP infered plex should cost more than 1 Billion isk last time they intervened when plex jumped to 1 Billion from 800. If it hits 1.5B they just might intervene if it happens quickly; if it takes months (as it should) they likely would not - because if the past is any indicator - if it slowly increases to an amount (1.5B in this example) - it will drop when next years summer begins. At which point it would be in the 1.2-.1.3 range and be a good price for that year; until september/october happens again and the base price for the next year is set at 1.5B and so on.

Did plex spike a large amount as opposed to a gradual increase this year? Yes it did. Will people unsub alts because of this? Yes they will. Will people quit the game because of this? Not unless they were already on their way out.

Plex always goes up; and this is beneficial for the game in several ways. The biggest benefit is the game sheds weight in the amount of illicit users who are botting or otherwise cheating to obtain isk to sell. High Plex Prices are the biggest blow that can be struck as far as black markets and RMT are concerned - because legitimate ISK from CCP is cheaper - Which allows players to legitimately purchase their isk in the form of PLEX from CCP without the premium tax of doing it the right way. The higher the price of plex - the less valuable EVE is as a potential black market money making activity.

Plex is worth much more than 1.2B - and 200m is an increase we could have expected this year as normal. However - this year we had a very successful plex drive taking thousands of plex out of circulation - we also saw skins introduced and many plex converted into aurum. The sinks for plex this year have been tremendous and as such the peak this year should be much higher.

The prices; spikes and trends we saw of years past; all with their own doomsayer threads; are incomprable based on the amount of plex sinks and uses/conversions for plex we have today. PLEX appreciated in value this year - it buys skins. So it can be expected that in additional to the normal price hike; an additional hike occur based on its new found demand.

The price of PLEX is ordinary for a month or two from today - given what happened this year I don't think its out of line; we should see higher peaks as winter commences. You say PLEX is not worth 1.2B and think it should be valued at 500m. I say plex should be 1.2B and more and I have provided details as to why this would be the case. This year is different and you should expect CCP knows this and will take it into account. Do not expect CCP to step in.

And that all assuming that plex prices are subject of reactive control. Again.

Interesting enough, we might have to ponder some facts:

- If CCP were to dump plex in the market to control the prices, it would be actually CCP unfairly "bailing out" the people who put up buy orders filled by internal plex supply. Which I might not take as something very "CCPist".
- The reverse is also true. If CCP were to buy plex to dry up the market, they would be in fact giving ISK for people from nothing.

The most reasonable outcome if it were done by that way is that the control of plex prices would end up being a ISK generator system that would be abused to oblivion by anyone and their neighbour.

FYI, that is what banks do in the bank internal market of IBB (a kind of bank only market of debt), and I know that doest end up well because I used to work in a bank.

So you gotta come up with another theory on how plex price is controlled by CCP.

I should remind you that CCP does have had, and I dont know, but assume, still do, in house finance geeks to control the way the market goes, and that is why the tools, the techniques and the aspect of the market is very kin to its IRL form.

I dont know if you read what you quote, but your answer has nothing really to do with what I wrote.

I was talking about the people who says that plex prices are controlled in that manner, and all time there is someone to say that. 4 times in this post, and to exhaustion in others, almost everytime you talk about plex prices or market in this forums someone come up with the genial idea that plex prices are controlled by CCP dumping or drying plex.

Edited, but still the same thing. But I understand that as most people doing combat are not fighter pilots, and most people doing industry are not engineers, so must traders not be market experts in the average.

LOL

I had a post; and it was emotionally charged and against the ideas of Motie One. I have decided it does not forward or do any justice to this thread or the ideas within and I have removed it. The premise was more than 30 seconds of thought would likely be required to formulate any idea that wouldn't be torn to hell within seconds by more experienced players with no economic experience.

Instead I offer this; Plex has risen and fallen several times over the years. Bubbles have occured thousands of times in thousands of areas in EVE. Plex rises every year for the winter and drops every year for the summer. Dr. Eyjólfur oversought this activity for many years. He taught the staff which monitors this activity today. it is no doubt they keep in touch with the good doctor whose lifes work to date could be defined by his contributions and work as EVE onlines ecomist. He knows better than all and should a situation appear to be critical; either he would be consulted or the expert staff he left behind would be able to determine if interference is needed.

So CCP would benefit themselves and the game... by emulating European central banks?

There are no stupid ideas, only stupid people...

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One of the hilarious things I've seen here is the idea that CCP should dump PLEX on the in-game market at a lower amount in ISK than the market is presently paying, and this would punish speculators.

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REALLY? People actually think this?

How would selling 1000 PLEX at a billion ISK each punish speculators?

A few players would buy one or two each, then someone with a liquid trillion would buy the remaining 950 and resell them over time. CCP would literally lose over ten grand in potential future revenue in order to give an ISK handout to a trillionaire.

I do expect CCP to intervene with a PLEX sale soon, which will not be a conscious strategy to adjust the price of PLEX, but instead a strategy to profit from the recent increases in price. And if someone with a liquid trillion buys up a lot of those PLEX from the market during the sale, CCP will likely end up selling more.

The people IRL have been working the popular consensus that market is driven by supply and demand for centuries, it is not so far fetched that people in EVE do the same. If you take a time to look at eve market, you will see that there is a place of powerful control over prices in a given hub by just placing a large order, lowering the prices gradually and to make people lower theirs in the hopes that works, then when you have a bunch of wanna be traders with orders as low as the price you would buy, you take of your order and buy them off before they can change their orders. Is the "Average Down", when your own prices being bought in low from a large order sum up with the cheap product you crashed the price, in average, making your bulk have cheap cost.

The reverse, buying higher in the hopes people will place orders to rise you, in order to artificially change the price up so you can afterwards dump your product in the market by higher price, the "Average up" where the product you bought at inflated prices dont matter as in average your sale at inflated prices will cover it and open window for the cheap product you bought to be also sold at inflated prices, in average granting profit.

Those only work in EVE for 2 reasons: 1) People believe in supply and demand law - 2) People act as if ISK was play money

That is pretty much why no matter how politics go, IRL or in EVE, the money doesnt really change hands equally, and concentrate in the hands of those who already have the money, and know how to use it.

But in the "Big Picture" the one who owns the EVE universe, CCP, is the richest power in EVE Universe, and not only owns the means of making things in EVE Universe, but the power of NPC corps, as mentioned.

In a dev blog you will find the concepts of "ISK mine" and "ISK sink", which are the means on how CCP controls the total ammount of ISK pottentially ingame. While the "its just a game folks" simple dont care (tl;dr and what not), the traders ingame are very much devouring all the material over ships, prints, mines and sinks, in order to understand how to avoid sinks.

While we do that in the internal market of EVE, CCP does that outside the EVE market, much like nations do with colonies and neo-colonies IRL.

So for that reason, they dont need to buy or sell plex in EVE market to control its prices. Like IRL central banks, they tweak the ratio of earning and losing ISK ingame to tweak the value of plex.

While some people assume the value of plex is derived from their own interests, the savvy trader will know that the value of plex is related directly to an equilibrium between the people farming ISK and the people sinking ISK. The priciple is very simple: Reasonable farming ability.

If ISK is to costly earned by plex, prices too low, it does not matter how the market is flooded, there is no interest in sell plex. If it is too costly to farm ISK for a plex, no matter how much the market is dry, there is no people buying it.

So the control is applied there, the "GDP" of New Eden. IT changes, plex prices changes naturally. We traders have little to say over and below the opening of the will of farmers and sinkers.

Well I am pleased to confim that your Geography, if not your political awareness is accurate.

Switzerland is in Europe but not in either the EU or the Eurozone.

The swiss central bank has a cap against the euro because of the issue of the swiss frank becoming a store of wealth harming the wider economy, and manipulated mercilessly by speculators.

Sound familiar?

It has been stunningly successful in preventing ongoing excesses, and the markets trade freely beneath this cap with confidence, efficiently.

When the speculators made an attempt recently to drive the frank out of it's range, It crushed them ..... Mercilessly by resetting a new cap and bankrupting them. It is in the stage of sterilising purchases, and then the cap will be eased somewhat again.

So to those who claim they would break any attempt by CCP, just make sure you have deeper pockets than the Central bank, bearing in mind they can issue, and sterilise Plex at will.

Pilot's services are a special case, they are CCP's interface to their real world income. Do not expect that CCP will allow plex to be treated like just some other player created commodity indefinitely. Once Plex - (assuming it hasn't already) ceases to be an effective means for players to buy gametime or other services, and thereby acting to sterilise plex created when Plex comes into game-.beware!
Each plex is designed to have a life, ending in it's exchange. It should be self sterilising,and if traded,and later redeemed, an isk liquidity system. Transferring from isk rich to isk light. It is Not a wealth store, designed to stay in the Game indefinitely.

Then expect an equivalent system coming into play, putting a Hard cap on price Via NPC sales setting the range it trades in. ( it will trade freely in this range, this is what is meant by a free market, not an uncontrolled disfunctional market.)

Why do you keep claiming that the Swiss central bank have a hard currency cap? They removed that back in January.