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What happned to the mineral markets?

Author
Vince Snetterton
#1 - 2012-05-01 11:56:02 UTC
I can't believe that the rise and subsequent crash of minerals was all the doing of a cartel of market speculators.
Zydrine has nosedived 20% in 36 hours, and some others are not far behind.

How is it possible for a few traders to dominate mineral markets so much, for extended periods of time?

And please, I am trying to understand the mechanics.

I don't need to see "I am so smart, you are so dumb. I manipulated the market and made a trillion ISK in the past month".
Tekota
The Freighter Factory
#2 - 2012-05-01 12:00:43 UTC
Not so much a cartel as a herd instinct. And not really just a few traders either.

Sure some big players undoubtedly had an impact and nudged things along one way or another with hundred billion isk investments, but by and large it was the herd (and I count myself a sheep here as much as the next person) seeing strong indications for a rise and all putting 1b-100b (mostly a *lot* of 1b) into it. And most of us, at roughly the same time, thinking the time is right to cash out.
Johnny Frecko
Violence is the Answer
Wormhole Society
#3 - 2012-05-01 12:07:12 UTC
It's not a cartel, more like clever people with a good knowledge of past events in eve with a large stockpile of isk, and the rest.

You see before the drone regions, Zydrine was happily sitting over 2K per unit, much like the limit we reached these past few days.
As soon as the nerf was announced those who knew the past immidietly bought up all the cheap 700 ISK zydrine out there including battleships and mods that are heavily based on zydrine.
Most of us also knew that people need the isk, they're are itching to get out and get rid of their large stockpiles of zydrine. Some were eager enough to sell to the rest of us at 1400-1500 per unit, doubling their isk. Others are cashing in right now. casuing the mineral market to take a dip(as was anticipated and predicted on various posts on MD).

My personal guess is that the resistence level is 2K, and the price failed to break that point once(this last week). Sellers will begin to panic and sell, and lose as little isk as possible.

Once this phase is over, Prices *should* continue to go up in the next few months, until they reach their innate equillibrium.

Reasons why prices went up :
1)increased aggregated demand
2)Speculations - note that these only smoothed the proccess out, The economic model of rational expectations explains this perfectly.
3)inflation.

Unlike other areas of the market, There were no manipulations here. Only fast reactions.

Hope it helps.
Vince Snetterton
#4 - 2012-05-01 12:09:59 UTC
Tekota wrote:
Not so much a cartel as a herd instinct. And not really just a few traders either.

Sure some big players undoubtedly had an impact and nudged things along one way or another with hundred billion isk investments, but by and large it was the herd (and I count myself a sheep here as much as the next person) seeing strong indications for a rise and all putting 1b-100b (mostly a *lot* of 1b) into it. And most of us, at roughly the same time, thinking the time is right to cash out.



Well, I am royally screwed. I guess you could say I did market speculation because I was asked to make a number of cap ships.
I bought minerals last week and immediately built cap components for ships that still are cooking for another week.

No way I will get the buyers to pay me next week enough to even recoup my mineral costs.

I have realized that sellers of cap ships base their spot sell price of current mineral prices.
That means it is quite profitable to build long mfg time, high mineral content items when raw materials are climbing in price.
It is a disaster when minerals are dropping.

Guess I should have done some arbitrage and set a firm sell/buy price when I entered into the arrangement, and transferred the risk to the buyer.
Tekota
The Freighter Factory
#5 - 2012-05-01 12:15:07 UTC
Vince Snetterton wrote:
Well, I am royally screwed. I guess you could say I did market speculation because I was asked to make a number of cap ships.
I bought minerals last week and immediately built cap components for ships that still are cooking for another week.


You're not particularly screwed - caps are very trit heavy. Trit has held up rather well of late. Total build cost has gone down compared to what you put them in the oven at but shouldn't be by so much that all your margins are taken - if it is then you likely did price them too cheap to begin with.

I'm churning out a freighter every 3 days and very much aware of your problems, but if freighters are anything like whatever caps you're building, (a) every other producer is in a similar boat and (b) margins are there to withstand a little sway in the mineral basket prices - especially if trit remains relatively stable.
Johnny Frecko
Violence is the Answer
Wormhole Society
#6 - 2012-05-01 12:17:58 UTC
not entirely mate.

big things with long build times take a big while to ballance on price.
you can probably sell the cap ship at a profit, or at least at no loss.
If someone wants to buy the cap ship from you, they have a choice.
wait a few weeks for a new cap ship to finish baking with *current* lower mineral prices OR
buy from you with a small premium for delivering it right now.

If you *just* bought your minerals, you might have a problem. if you bought them a few weeks ago you should be fine i believe.

also : if you ask me, minerals are going to rise again in the next month or two. so sit tight.

Johnny
Casius Omega
Deep Core Mining Inc.
Caldari State
#7 - 2012-05-01 12:25:26 UTC
dont worry zydrine will go up agian.. it cant stay at 1400 or lower.
Barakach
Caldari Provisions
Caldari State
#8 - 2012-05-01 12:28:04 UTC
Hulkagedon is just starting. My small alliance is already posting lots of kill-mails.
Claire Voyant
#9 - 2012-05-01 13:41:31 UTC
Casius Omega wrote:
don't worry zydrine will go up again.. it can't stay at 1400 or lower.

The sun will come out tomorrow, so you gotta hang on 'til tomorrow, come what may.
Tomorrow, tomorrow, I love ya, tomorrow, you're always a day away!
Caleb Ayrania
TarNec
Invisible Exchequer
#10 - 2012-05-01 13:57:21 UTC
Claire Voyant wrote:
Casius Omega wrote:
don't worry zydrine will go up again.. it can't stay at 1400 or lower.

The sun will come out tomorrow, so you gotta hang on 'til tomorrow, come what may.
Tomorrow, tomorrow, I love ya, tomorrow, you're always a day away!


SING IT..

Dont worry its gonna go higher then many are expecting.. The consequences have not reached us yet, we are running on pumps..

What vaporized was the active traders and logistics keeping the market up. They will come back, and with less supply and new market features.. Oh its going high.. TRT, PYR, MEX, ISO, NOX, ZYD,MEG, MOR ; 7.15 , 8,25, 62, 115, 1200, 2400, 4650 , 22500 are my targets within 2 months..

Sadly I have no liquidity to invest.. so hard to work and ride the wave for me..
Krixtal Icefluxor
INLAND EMPIRE Galactic
#11 - 2012-05-01 14:02:32 UTC  |  Edited by: Krixtal Icefluxor
Vince Snetterton wrote:
I can't believe that the rise and subsequent crash of minerals was all the doing of a cartel of market speculators.
Zydrine has nosedived 20% in 36 hours, and some others are not far behind.

How is it possible for a few traders to dominate mineral markets so much, for extended periods of time?

And please, I am trying to understand the mechanics.

I don't need to see "I am so smart, you are so dumb. I manipulated the market and made a trillion ISK in the past month".



There's this dude, you see. He's called The Mittani http://en.wikipedia.org/wiki/Eve_Online#Griefing_2

He did THIS: http://www.evenews24.com/2012/04/24/leak-goonswarm-federation-ceo-update-goonswarm-unbound/

The weird decline yesterday..........I really have no idea. Any speculation as to 'why' will probably take a few weeks to emerge with actual results. All we can do is watch the 'suspects'.

"He has mounted his hind-legs, and blown crass vapidities through the bowel of his neck."  - Ambrose Bierce on Oscar Wilde's Lecture in San Francisco 1882

Weaselior
GoonWaffe
Goonswarm Federation
#12 - 2012-05-01 14:24:25 UTC
minerals nosedived because anyone trying to get them out of jita this week would have gotten ganked

Head of the Goonswarm Economic Warfare Cabal Pubbie Management and Exploitation Division.

Vince Snetterton
#13 - 2012-05-01 14:31:00 UTC
Weaselior wrote:
minerals nosedived because anyone trying to get them out of jita this week would have gotten ganked


I don't believe that is accurate.
Sure, moving freighters in and out of Jita was death on Thurs-Sun, but I moved one in Sun night, and out Monday morning.
Plus the mineral crash happened Monday.

Further, the mins that took the biggest hit are high end mins that are not moved in such bulk.
Akita T
Caldari Navy Volunteer Task Force
#14 - 2012-05-01 14:39:00 UTC
Vince Snetterton wrote:
How is it possible for a few traders to dominate mineral markets so much, for extended periods of time?

Overhyping the likely supply slump due to upcoming (now in the past) drone rebalance and still upcoming Hulkageddon.
Exploiting the "lemming effect" to nudge favourably rather than force-set prices, using a lot less "self" capital and a lot more "other people's money".
Quick downwards rebound due to BurnJita interdiction measures.

It's still to early to tell exactly where prices will stabilize. At least not without hard data we're not privy to.
Wyke Mossari
Staner Industries
#15 - 2012-05-01 14:50:00 UTC

It is not a cartel, it is just profit taking, it happen on patch day(s) just like the end of month and quarter for RL traders.

Treat this good opportunity to buy, prices will bounce back and higher still.
Pinstar Colton
Sweet Asteroid Acres
#16 - 2012-05-01 14:56:45 UTC
I think the real stabilizing factor will be once the T1 module manufacturers get production in gear. The supply of T1 modules is still pretty high and will take awhile to dry up. Once they do, prices for them will rise until manufacturers see enough profit to start making them.

That will turn meta 0 modules that once were a mineral supply into a mineral demand and put sustained upward pressure on the price of minerals.

The real question will be if the drop rate of meta 1/2 modules can keep up with the demand of people just looking for a cheap replacement module.

In the cat-and-mouse game that is low sec, there is no shame in learning to be a better mouse.

Wyke Mossari
Staner Industries
#17 - 2012-05-01 15:03:22 UTC  |  Edited by: Wyke Mossari
Krixtal Icefluxor wrote:
Vince Snetterton wrote:
I can't believe that the rise and subsequent crash of minerals was all the doing of a cartel of market speculators.
Zydrine has nosedived 20% in 36 hours, and some others are not far behind.

How is it possible for a few traders to dominate mineral markets so much, for extended periods of time?

And please, I am trying to understand the mechanics.

I don't need to see "I am so smart, you are so dumb. I manipulated the market and made a trillion ISK in the past month".


There's this dude, you see. He's called The Mittani http://en.wikipedia.org/wiki/Eve_Online#Griefing_2

He did THIS: http://www.evenews24.com/2012/04/24/leak-goonswarm-federation-ceo-update-goonswarm-unbound/

The weird decline yesterday..........I really have no idea. Any speculation as to 'why' will probably take a few weeks to emerge with actual results. All we can do is watch the 'suspects'.


You might eat your own dog food, but don't expect that MD will, let me spell it out real simply for you.

Mittens had nothing to do with the recent rise or fall in mineral prices.

Any change in prices that resulted from Burn Jita was brownian noise compared to the black swan of the drone droppings nerf.
Atreyu Bayne
Aliastra
Gallente Federation
#18 - 2012-05-01 15:12:34 UTC
Vince Snetterton wrote:
Weaselior wrote:
minerals nosedived because anyone trying to get them out of jita this week would have gotten ganked


I don't believe that is accurate.
Sure, moving freighters in and out of Jita was death on Thurs-Sun, but I moved one in Sun night, and out Monday morning.
Plus the mineral crash happened Monday.

Further, the mins that took the biggest hit are high end mins that are not moved in such bulk.


No it's pretty accurate. Change your market from graph to actual statistics and you'll see it's slowly recovering from burn jita. People STILL ask me even today if burn jita is over. Not everyone reads forums and people are scurred.

That being said, thanks everyone for the "Cheap" 1200 isk zydrine. Big smile
Casius Omega
Deep Core Mining Inc.
Caldari State
#19 - 2012-05-01 15:13:41 UTC
actually burn jita is exactly responsible for this. Anyone with half a brain was not buying and moving minerals in jita. This cause mineral demand over the weekend to plumit and things just were not selling. This cause people to constantly keep undercutting each other trying to sell which in turn reduced the price enough and freaked people out who had stockpiles into selling there piles. Prices will go up soon once people stop panicking. By all means keep dropping zydrine so i can buy another 20b at 1000 a unit.
Krixtal Icefluxor
INLAND EMPIRE Galactic
#20 - 2012-05-01 15:22:38 UTC  |  Edited by: Krixtal Icefluxor
Wyke Mossari wrote:

You might eat your own dog food, but don't expect that MD will, let me spell it out real simply for you.




I have absolutely no idea what this is about.

I'm just getting the hell out of this thread with that though...................

"He has mounted his hind-legs, and blown crass vapidities through the bowel of his neck."  - Ambrose Bierce on Oscar Wilde's Lecture in San Francisco 1882

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