EVE General Discussion

Whilst true, completely unnecessary and offtopic.

This thread is about isk sinks.

You could have PMd him this instead of derailing the thread.

This is along the lines of what I've been thinking.
Glad to hear someone else articulate it.

That NS produces 92% of bounty faucet many many times over the value of WH blue/Overseer effects, and WH/HS/LS bounty combined, seems off to me.

Since NS bounties are overwhelmingly the greatest ISk faucet, what are they doing with that isk that deflation would still occur?

It seems to me that as the massively overwhelming introduction of isk to the game is in NS, the cause of deflation despite that overwhelming rate must also be located in NS.

Its unreasonable to search for a cause to deflation in HS/LS/WHs, since they are responsible for far less isk introduction, including even Incursions (many of whom are alts of NS based players).

Clearly they are not re-introducing that isk into the player market (despite unadulterated HS/NS trade), which would forestall deflation.

What is NS doing with that enormous isk income that deflation can (according to Teckos) occur concurrently?

First of all, you have to understand that STUFF is not an isk faucet. They way you get isk from any kind of item is by selling it (or selling a product made from it). Mining is not an isk faucet... it's a MINERAL faucet but the amount of isk isn't impacted. Any isk from mining comes from another player. Blue loot from WH's is not an isk faucet either. While there are minor ones... the main isk faucet is bounties.

Isk sinks are those where isk permanently leaves the game (instead of going to another player). Payments on insurance where the ship isn't destroyed in time to collect are an isk sink. So are skill books and any other non-manufactured items available on the market. Isk paid to LP stores is also a sink... that money leaves EVE... whatever money you make from selling the stuff comes from other players.

The biggest sink is simply players quitting without giving their isk away. That's not a complete sink as they COULD come back... but it does take that isk out of potential circulation.

Because of that setup, we have a constantly increasing supply of isk. That increased money supply is an inflationary pressure... if the same amount of stuff is available but the money supply increases, prices go up as people use their additional isk to get more stuff.

But we also have an increasing supply of "stuff". PI and mining and drops from NPC's all create things that can either be sold or can be turned into other things. The increased supply of "stuff" leads to deflation... lower prices if taken by itself. If the money supply (purchasing power) is stagnant but the amount of stuff goes up, the price of that stuff goes down as people compete to get their stuff bought.

The fact that we are seeing deflation simply means that the supply of STUFF is going up faster than the supply of ISK (or at least the supply of ISK that is actively being used as opposed to sitting in inactive accounts). That could be Rorquals. It could be more people doing PI. It could be a huge number of passive moon mining operations. It could be wormhole drops. But it's not on the bounty side... more bounty payouts (more isk faucet) or less isk sinks would be one way of attempting to address that. So would decreasing the level that "stuff" is output at.

That's a simplistic 1000 foot view of it.

This is not necessarily accurate (though it might be).

You have to look at it in terms of Products and Money.

Money created out nothing (like printing more currency in real life) is inflationary. That would be bounties, mission rewards and time bonuses.

PRODUCTS created out of nothing is deflationary. It puts more stuff on the market that people can spend isk on, which drives prices down. This includes loot drops from Rats (including WH rats), mining, PI, Moon-goo harvesting, items purchased with LP (particularly if they also require isk) and salvage.

Well... Personally i have 100 billion ISK in wallet. These ISK just sitting there. Because atm there is nothing to spend ISK on in the game.

Other think i would like to mention is that 0.0 looks dead lately. My corp roams almost every day and last month or about we have big problem to find anything alive around. Outside of some obvious places like Providense or FW low-sec there is almost none to fight.

Keeping this in mind i would look at graphs of items/ships destruction and look if it shows decline. If it does then deflation might simply mean that ISK are sitting in wallets and not go to market.

It always works don't it, find a group to blame, it's illegals, it's those damn signoids, blah, blah, always bring that one golden hate bullet and blame carebear, seriously look around you and take the hate goggles off for a moment;

We have:

EC and Citadels being built in many corners of eve.

Cap ships don't seem to be a problem to build by anyone, nobody complaining that they are too expensive, they get printed out quick enough.

Flying around New Eden I assure you people are sporting the latest in tier ships.

Blaming one group is just plain short sighted, if there's a problem in the economy it has many factors and placing blame upon one group is why we have our problems in RL too, stop with the "it's carebears" because anything as complex as an economy has many things that can make it stagnant.

Building Supers and Titans.

Building Citadels, ECs, and getting ready for Refineries.

Building rigs for Citadels and ECs. The t1 XL rigs are still tens of billions of isk, and it is far more time efficient to rat up the isk and buy out the Jita supply than to salvage your own wrecks.



I might be confusing terms here, but I think we are mixing up the money supply that has been flat since Citadel release (except the sudden jump and decline with alphas) and actual sinks and faucets in the game.

Weird thing happened here.

See below.

You accept PvP when you click undock. If you have an issue with that, Singularity is open for you.

Inflation/deflation are pretty much monetary phenomena. That is when the money supply grows faster than the real sector there is inflation, and when it grows slower there is deflation.

In a general sense inflation usually means the government is "taxing" people's cash holdings and spending that tax. CCP does not in that money creation is largely the result of player actions (ratting, missions, etc.) that create ISK de novo. With deflation it is like earning interest on you cash holdings. If this gets too large then spending can collapse and trigger a recession or turn a recession into a depression.

Edit: Also, one has to keep in mind why more ISK in game does not simply become more inflation. ISK tends to sit in people's wallets. That is players are not putting ISK into a bank which in turn lends it out. And when a player leaves the game all the ISK in his wallet effectively leaves the game too.

The Federal Reserve did something similar during the financial crisis. The Fed would "sterilize" the money it was giving to banks that it felt were in trouble. That is, if they were going to lend $20 billion they'd first sell $20 billion in treasuries--i.e. take $20 billion out of the economy. So take out $20 billion, put in $20 billion, net result no change to the money supply. The Fed was very worried about inflation.

When it came to quantitative easing they had to use a different tool to keep the money from entering the economy since they did have that many treasuries. So they started paying interest on bank reserves. So you give the bank $50 billion and pay a very low interest rate on that $50 billion so the bank won't want to lend it. This increases the banks reserves, which if the bank in illiquid or even insolvent can prop it up...but if carried to far it can lead to a reduction in overall lending as well, which in turn can reduce spending in the economy.

The point is the money supply is considered the primary factor in inflation/deflation.