Curse

Chthon · Jun 26, 2008, 05:40 PM // 17:40

I'm tired of seeing a dozen new "a-net U must nerf teh SF/Chaos Planes cuz it will ruin teh economyz" threads pop up almost every day. Rather than try to refute this idiocy as it pops up over and over again, I'm going to consolidate my responses into one post, here, and just link to it for all future "a-net U must nerf teh SF/Chaos Planes cuz it will ruin teh economyz" threads.

1. SF/Chaos Plains Farm Is NOT Causing the Drop in Ecto Prices; Rather Hysteria about SF/Chaos Plains Farm Is Causing It.

SF/Chaos Plains Farm Is NOT Causing the Drop in Ecto Prices.
Ecto price is set by supply and demand. There is an illusion that the chaos plains farm is causing a huge spike in supply. It's not. After 3 years of farming and hording ectos, there are already so many of them out there that the chaos plains farm cannot make a very large impact on the supply, except over a very long period. The farm has virtually no impact on demand (which would have stayed constant had people behaved rationally). Thus, since the farm has only a small impact on supply, and no impact on demand, it has only a small impact on price.
Hysteria about SF/Chaos Plains Farm Is Causing the Drop in Ecto Prices.
The hysteria over the possibility that ecto prices might fall is, in fact, the reason that they've fallen. Chatter in ToA and "a-net U must nerf teh SF/Chaos Planes cuz it will ruin teh economyz" threads on the forums have convinced some people that prices would fall. This has affected supply by leading people to sell their ectos short and it has affected demand by leading people not to buy ectos who otherwise would. It's a classic "self-fulflling prophecy"/"run on the bank" scenario.

2. A Drop in Ecto Prices Is NOT Bad for the Economy.

Even if SF was behind the drop in ecto prices, it wouldn't matter because a drop in ecto prices is not bad for the economy.

The ecto price affects only ectos; nothing else will be affected.
Let's say you wanted to sell an item for 100k+10e back when ecto were at 5.5k. That means you were really trying to sell it for 155k. Let's say the ecto price falls all the way to 1k. ("ectoz R 1k?!?! OMG teh economy iz runed!!!!111") What do you do? You mark your item up to 100k+55e and go on your merry way because it's still worth 155k -- exactly the same amount it was worth before ecto prices dropped. As you can see, ecto prices only affect ectos. Other items are not impacted.

A couple of small caveats:
- The opportunity cost of a small class of very high-end trades will increase. The trade window can only hold 100k + 1750 ectos. That means that, at 5.5k per ecto, it could hold 9725k; but, if ectos fall all the way to 1k, then it could only hold 1850k. That means that, for those high-end trades that fall between those two values, the buyer is going to have to spend the time to convert some ectos to armbraces if ecto prices fall, but not if ecto prices stay high.
  
  To this I say, "boo fricking hoo." I couldn't care less if someone trading an item worth more than 1,850,000g has to take some time to buy armbraces. I've never even seen an item that valuable, and neither has 99% of the playerbase. For the vast majority of us, this is a non-issue.
- Extremely rich people will have less storage space. If ecto prices fall from 5.5k all the way to 1k, then the 1375k that could be "stored" in 1 stack of ectos at 5.5k/ecto will instead require 5 & 1/2 stacks at 1k/ecto.
  
  Again, "boo fricking hoo." If you're so rich that you have trouble finding a place to put all your ecto, you can always just give some to me.
The Rationales for WHY a Low Ecto Price Is Bad for the Economy Are Faulty.
Often, posters in the "a-net U must nerf teh SF/Chaos Planes cuz it will ruin teh economyz" threads don't provide any rationale at all. They seem to take for granted that a low ecto price means the end of the world. But they never explain why a low ecto price is bad for the economy. Largely, their reasoning follows this progression: 1. Ecto prices drop. 2. ???? 3. "Oh noez, teh economy is ruined!" This is poor reasoning, and unconvincing.

Sometimes, they provide an explanation, but it's faulty. Pretty much every explanation of why a low ecto price is bad for the economy boils down to one of two faulty arguments:
- 1. "A low ecto price is bad for the economy because it means my stacks of ecto are worth less."
  
  Well, that's certainly bad for you, but you are not the economy. Someone else is gaining as much relative buyer power as you are losing, so the net effect for the economy is a wash. If anything, it's actually good for the economy because it might motivate you to become more productive in order to reestablish your relative buying power.
- 2. "A low ecto price is bad for the economy because it means other people will be able to get the same FoW + Chaos Gloves + Dread Mask outfit as me!!"
  
  Again, that may be bad for your e-peen, but your e-peen is not the economy either. More importantly, you should take a good look at what exactly you're saying here -- you're asking a-net to act to prevent other people from achieving their goals so that you can continue to feel superior to them. That is selfish, petty, and, frankly, pathetic.
  
  (A marginally more valid argument for a nerf would be that, since your FoW + Chaos Gloves + Dread Mask outfit is so horrifically tacky, people should be prevented from making more of them on aesthetic grounds.)

Short Summation:
SF/Chaos Plains farm is NOT causing the drop in ecto prices. Rather, hysteria about SF/Chaos Plains farm is causing it. Even if SF was behind the drop in ecto prices, it wouldn't matter because a drop in ecto prices is not bad for the economy. Why? Because ecto prices affect only ectos and nothing else. The two reasons commonly given for why a low ecto price is bad for the economy are wrong because they confuse what's bad for one's personal pecuniary interest or one's e-peen with what's bad for the economy. You are not the economy. Your e-peen is not the economy.

Good day.

clobberus smashicus · Jun 26, 2008, 05:43 PM // 17:43

i agree
/signed

romeus petrus · Jun 26, 2008, 05:44 PM // 17:44

Clearly not a valid discussion. SF made it rediculously easy for anyone with half a brain to make a stack of ectos in a matter of hours. There is no build out there atm that made ectos farming so efficient. That means we have loads and loads of ectos farmed every day and poured into the economy.

If we discover a way to turn sea water into Oil efficiently and for cheap, we wouldnt be paying $4.50/galon for gas. Basic supply and demand.

/close please

A Leprechaun · Jun 26, 2008, 05:45 PM // 17:45

I'm pretty sure SF is causing the drop in ecto price but I couldn't care less.

~A Leprechaun~

absolutcrobi · Jun 26, 2008, 05:46 PM // 17:46

from someone who has farmed a lifetime total of 22 ectos, i agree.

Chthon · Jun 26, 2008, 05:47 PM // 17:47

Quote:

Originally Posted by romeus petrus

Clearly not a valid discussion. SF made it rediculously easy for anyone with half a brain to make a stack of ectos in a matter of hours. There is no build out there atm that made ectos farming so efficient. That means we have loads and loads of ectos farmed every day and poured into the economy.

1. You are wrong.

2. Even if you were right, it wouldn't matter because a low ecto price is not bad for the economy.

N1ghtstalker · Jun 26, 2008, 05:47 PM // 17:47

SF is actually raping the economy
it farms ecto mainly until the prices are down so badly they're not even worth farming anymore
then the attention will be turned to other things until the entire economy is milked dry by perma farmers

Gift3d · Jun 26, 2008, 05:47 PM // 17:47

Oh okay. Ecto prices drop by 2k right after the SF update, but it's not cause of the SF update!

You're just another moron making just another SF thread. Grats.

Targren · Jun 26, 2008, 05:50 PM // 17:50

Quote:

Originally Posted by romeus petrus

Clearly not a valid discussion. SF made it rediculously easy for anyone with half a brain to make a stack of ectos in a matter of hours. There is no build out there atm that made ectos farming so efficient. That means we have loads and loads of ectos farmed every day and poured into the economy.

If we discover a way to turn sea water into Oil efficiently and for cheap, we wouldnt be paying $4.50/galon for gas. Basic supply and demand.

/close please

Reading was apparently too hard for this guy.

OP has it exactly right.

romeus petrus · Jun 26, 2008, 05:52 PM // 17:52

Arguing that SF didn't cause the ecto prices to drop is nothing short of laughable. If you truly believe so, there is clearly no point in continuing this discussion.

Chthon · Jun 26, 2008, 05:56 PM // 17:56

Quote:

Originally Posted by romeus petrus

Arguing that SF didn't cause the ecto prices to drop is nothing short of laughable.

Again, you are wrong. But let's assume for a moment that you're right. So what? Explain, if you can, why a low ecto price is bad for the economy.

Sora267 · Jun 26, 2008, 05:58 PM // 17:58

The only reason ecto prices have fallen is because of the idiots selling all of their farmed ecto to the trader, NOT hysteria.

Edit:

Quote:

Originally Posted by Chthon

Again, you are wrong. But let's assume for a moment that you're right. So what? Explain, if you can, why a low ecto price is bad for the economy.

He never said a low ecto price was BAD for the economy. He simply said ectos were being poured in at a higher rate than before because of the farm, which is true.

Targren · Jun 26, 2008, 05:59 PM // 17:59

Quote:

Originally Posted by romeus petrus

Arguing that SF didn't cause the ecto prices to drop is nothing short of laughable. If you truly believe so, there is clearly no point in continuing this discussion.

The only thing laughable is the hysteria of those who think it's a supply/demand problem. Like the OP, many others, and I have said for some time, this is wrong thinking. You cannot have a Supply/Demand issue WHEN YOU HAVE AN INFINITE SUPPLY.

The supply of ectos was infinite before. It is infinite now. The traders do not care how many ectos are "in circulation." Their prices are affected by the number of ectos SOLD TO THEM. So when some troll started this whole chicken-little fiasco, the hoarders got their panties in a twist, started selling short to liquidate, and flooded the seller, driving the price down.

Jebus · Jun 26, 2008, 06:02 PM // 18:02

One of the best (economical) posts in a while, good job.
You're completly right about the fact that there are already loads of ectos ingame, while this new farm only gives the illusion of bringing in loads (which it does, but as I said, there are already loads out there). However, the ecto price will most likely stabilize again (Currently dropping a bit atm) after the SF 'nerf'.

Quote:

Originally Posted by Targren

The only thing laughable is the hysteria of those who think it's a supply/demand problem. Like the OP, many others, and I have said for some time, this is wrong thinking. You cannot have a Supply/Demand issue WHEN YOU HAVE AN INFINITE SUPPLY.

There's no infinite/unlimited supply, there's a large, very large, supply of ectos, but certainly NOT infinite. It would be wrong to state that, as it gives a different image of the reality.

Sniper22 · Jun 26, 2008, 06:03 PM // 18:03

Ummmmmmm no

There is a great increase in supply of ectos, and people also use the ectos for armor, not just trading it with rare weapons, so ectos don't stay in the game forever. Slowly we are seeing a decrease in ecto price. If you have noticed, the ecto price did not drop immediately so your "hysteria" explanation is false. I believe the farm was around for a week or two before the ecto price actually started to drop. If the price decrease was really caused by speculation, then people would have noticed a more immediate drop.

Also with all the newly farmed ectos, people like to sell them off quickly so they can put the money earned to use. There would be no point of farmers to hold a stack of 50 ectos and not sell it. We now have a huge increase of people selling a large supply of ectos... of course the price will decrease.

Retake high school economics and close this thread.

Oh btw, most of the ectos in the game are being held by players who have over 1000k, so since they can't get any money, they can't sell them. So these ectos really do not count as supply on the market.

lyra_song · Jun 26, 2008, 06:03 PM // 18:03

"Im right, youre wrong."

This isn't a discussion. Its a rant.

Big_Iron · Jun 26, 2008, 06:04 PM // 18:04

All for closing, say "aye!"

Bryant Again · Jun 26, 2008, 06:04 PM // 18:04

Quote:

Originally Posted by lyra_song

"Im right, youre wrong."

This isn't a discussion. Its a rant.

< concurs with the madame.

immolatus · Jun 26, 2008, 06:05 PM // 18:05

The same thing was said when the 55 Monk build started. Ecto prices did drop for a couple of months but they came back up, not as high as before but still high enough. Glad to see A-net nerfed 55 Monks and they exist no more. Oh wait, they do still exist.

If Ecto prices drop then so be it. Go farm something else then. Maybe now regular players will be able to get that over priced crappy looking obsidian armor.

A Leprechaun · Jun 26, 2008, 06:07 PM // 18:07

He's wrong about SF not causing the price drop, for the most part it did. But he is right about how it really does not matter, because it doesn't.

~A Leprechuan~