Market Discussions

Including yourself.



With a market price that is now very low or even below cost...meaning unless you sit on the inventory you lose money, and even if you sit on the inventory you have money tied up not earning you a return, meaning you lose money.

On a...theoretical note, if there were a barrier to entry to a market then driving the price down could, in theory be used to keep competitors our of the market or drive them out of the market. Problem is there are not many barriers to entry in markets. For example a barrier to entry would be a sunk cost. But there are not too many sunk costs in Eve. Another barrier could be regulatory compliance...but again, not in Eve. Brand loyalty could be a barrier to entry, but in most markets that is not a factor as branding is pointless. Patents and intellectual property laws can be a barrier to entry...but not in EVE as those just don't exist. Another problem is you have to be able to meet the demand at the lower price, all of it, or the price will start to go back up.

Limit pricing can be a possible viable strategy to obtain or retain market power. But in practice it rarely works. Part of the reason is that once a competitor enters the market limit pricing is basically alot like cutting off one's nose to spite one's face.

Why? Doesn't he like to maximize his profits? Also, I don't think you get what speculators do. They take advantage of information about markets and help ensure that such information is reflected in the price. For example, if a speculator learns about some sort of negative supply shock before others in the market he'll go out and start buying driving the price up. If people know he is a speculator and think he might have an inside track on something they might follow him, further pushing up the price. So instead of the price rising once the information is released to the general public it happens sooner sending the correct price signals.



If you mine the minerals they are not "free" because of opportunity cost. That is, you could simply sell the minerals directly and pocket that ISK. So technically it becomes a cost if you don't sell them and instead use them to make something.



I think you need to change the word "they" some something a bit closer to home.

Goodness no, you should never try to maximise your profits, that would be silly unless maximising your profits on particular items is your singular goal in EVE.
If growing your wealth is your goal in EVE, then maximising your profits becomes a distant second.

The two are not the same. Money tied up in stock is money (temporarily) lost.
You may therefore often choose to sell with no profit or with a loss, in order to grow your wealth.

Let's say, the item you are looking at is item X.
Your opposition has the choice between making 10 bn isk on item X - or he can pull out fast and make 0 bn ISK on item X , but then make 20 bn ISK on item Y.
The choice should be easy. He didn't maximise his profits on item X, but his wealth will grow with 20 bn instead of 10 bn.

EVE traders make decisions like these every day. And in fact the decisions are less clearcut that I made them out to in my example, because the market is a flowing tapestry of prices going up and down, where you decide at which point to buy or sell many different items, in order to have sufficient cash at hand and to maximise the growth of your wealth.

(Also: you can never truly maximise your profit on a specific item, because you do not know if the sell price on that item could be higher 2 years or 20 years from now. )

The morale is, don't conclude that your opponent is a moron, simply because you do not understand what he is up to :)

When I bother to station trade, I just ignore this sort of tactic by ignoring orders outside station. Not the best option, but it works fine enough when doing, say, Jita 4-4 trading.

Maximizing profit is not always better than fast turnover.

And there is always the issue of not having enough space for all the buy and sell orders you have outstanding, so sometimes one needs a 'sale' to clear the decks for a better selling line.

Again, not inconsistent with maximizing profits.

Why are you "clearing the decks"...because it will mean more ISK. More ISK is consistent with profit maximization. And chances are you are looking at the sell prices vs. your cost of acquiring the good in question...i.e. you are looking at prices.

Which goes back to my initial comment that has sparked this series of posts....you do care about prices. You look at your price to acquire the good vs. the price you can sell it at. And you look at prices of other goods as well, if you see a better opportunity you go for it...totally consistent with maximizing profits.

Here is a hint for you guys, prices in an economy convey information.


You guys are basically making my point....and don't even realize it.

I mean seriously...holy ******* ****.

Those people are idiots, but if you try hard enough you can create an opportunity for them to be useful idiots.

I don't think we are, but it's nice to read your linguistic gymnastics

Oh for the love of God....

The whole point is that if you mine your own minerals they are not free due to the concept of opportunity cost.

You are like the poster child of why businessmen are ****** economists (don't worry, I'm the poster child of why economists are ****** businessmen).

Edit: BTW, the notion as to why such doofie are such useful idiots is that if they think the minerals are "free" and they sell you a finished good ignoring the value of minerals they mined you are buying the good at a price well below market value.

Maybe you are not such a good businessman either, come to think of it.