How Real is The Real Cash Economy?!

Discussion in 'General Entropia Universe Discussion' started by AxeMurderer, Nov 17, 2010.

  1. AxeMurderer

    AxeMurderer Master Of Entropia

    From where to start...

    1.People say that market prices are formed by the players, by the suply and demand as it is in real world. But this is not true. Market prices are dictated by MindArk. When they lower tre amount of sweat you get, the price go up. When they make some loot less - the price of that loot goes up.

    2.In real life there is constant Inflation (inflation is a rise in the general level of prices of goods and services) with few moments of Deflation (deflation is a decrease in the general price level of goods and services). In other words if you get 10 eggs for 1$ in real life today, you will need 1,20$ after a year to buy 10 eggs. In EU its the other way around. If you buy something today (appartment for example) it will cost less in the future.

    3.In real life when you get some row materials, perform some actions on them and make some goods you get more value after that. In EU you invest materials, skill, time and effort and at the end get alot less then what you have in the begining.

    4.In real life when you have more skill you are more eficient, when you use better technology you are more eficient. In EU if you get better armor or weapon or vehicle or estate or skill you loose more.

    5.May be this is not pure economic, but other thing that bothers me is that no matter how good you are at shooting or jumping or designing or running or wathever real skill u can use in games, you don't get better results than one handed blind men shooting randomly at the mobs.

    6.There is no way you can make money from EU even if you played for 5 years spending 10 000$ on the next hunt you will just add more to that 10 000$.

    7.Buying asteroid for 335 000$ is just marketing trick and there is no way someone will make profit from buying it.

    I like the game. The graphic is amazing, the idea is amazing. I will give it a chance to proove that it's a good game, but there is something that tells me that the game is not exactly how it must be.
     
  2. It's up to you to interpret the "Real Cash Econmy" line. The only thing we know is that is a ingame ecenomy connected to real money. You can put in money and you can get back money. It's sad that MA for ages have adverticed this as a place where you can earn money, and for some lots of money. This is true, but for a very small part of the players. You will for sure not get rich fast by gather resources and then sell them for markup. What you cando is gather resources, have luck and then use your luck wisely. You have to understand how the ingame econmy works, be fast, understand the opportunity that show for you. If a rare object loots and you are the first one to get it, you can sell it with high markup, but soon there will be other items like yours and the price falls. You can when you see the demand raise hold on to your item or resource and then sell it with good markup. You can use your profit to buy a rare Blueprint and manufacture rare items and sell them with high markup. But just run around mine or hunt will never make you rich in the long term. What you need to do is take you $10.000 and invest them in something like an LA and then maintain and advertice your LA to atract players.

    Regarding the asteroid, it was first bought for $100.000, that sum was earned back in 8 months. Then he has hold on to it and kept earning from his investment and now sold it for astonishing $600.000. That kind of prove that you can get rich in here, but you need to invest big time and then manage your investment to atract people. I did spend my last 2 days at the asteroid and IMO, it's dead compared with what it used to be, we can only hope that the new owner and his fellow dome owners can make a living place again.
     
  3. Ofc it is not real, it are all just a bunch of pixels.

    However:

    @1: if i buy all the narcanisum there is in auction the price will go up, so players can and do influence markup a lot. However if MA decides to change something it can affect the markups a lot more then what players can influence.

    @2: (un)fortunately (depending if you are buying are selling) there are also commodities that become more expensive. However if i buy 10 eggs today, i can throw them away in a month,

    @3: That depends on what you craft, if I for example craft something in real life, i can throw it in the garbage afterwards. In the game i will loose some tt value of an item, but i can sell the item for more markup then i paid (on a side note, don't try crafting).

    @4: Nope, more skills make you hunt the same mob more effictively, in EU some people however also upgrade the monsters they hunt, causing them to loose more.

    @5: You won't get better loot, but you will have lower costs

    @6: It is unlikely yes (well duh), not impossible

    @7 not a marketing trick since they one who bought it is a real player. And i do think he paid way too much for the asteroid, especially with a new big item hitting the auction soon. He will however probably get enough income to stop working, for as long as this game is still around.
     
  4. These are just some of my thoughts on your statements.
     
  5. 1. Partially true. Supply and demand dictates prices, AS ALSO MindArks adjustments of loot.

    2. Not true. Certain old school weapons have risen in price for years, though lately the prices have dropped. Estates are only in small decline. Land areas are on the rise, or stay same. Many weapon amps are on the rise. Events, MindArks decisions on loot, summer/winter time, new VU items, all these make fluctuations to prices. To me it resembles more like a rather steady economy like in my home country with hardly no inflation at all, only random changes in random item prices (depending on new inventions, new methods of manufacturing, redesigned logistics, bargains new enterpreneurs give to get place in market, rising/lowering raw material prices, and so on).

    3. Mostly true. Although at very high skill levels of crafting, with proper blueprints, you will get sellable items enough that the process can create constant net profit.

    4. So and so. More skill makes you more efficient using weapons/items that skill concerns. That is a well-tested fact. Less misses with gun, more return from crafting, and so on. This is like IRL. But "better" equipment is usually not better for too low skill level. At zero rifle skill you could upgrade to Justifier Mk V from Opalo, with same miss%, use Martial armor with zero evade skill, and go hunting big atroxes. You would end up with horrendous losses both in wasted ammo and armor decay. Where was the mistake, and how this compares to IRL? If you are given Photoshop, and you only know how to use MS Paint, you would be immediately less efficient manipulating pictures. If you are an rather efficient errand boy with a bicycle, and you are given a van, you would immediately be less efficient (relatively) with lacking driving experience and certainly less efficient than, say FedEx. You maybe can use traditional lathe for carving metals, but your efficiency would drop to zero if you were given a modern computerized model which would be more precise and effective only with proper skills.

    5. This I agree. I hate the fact that no matter how much skill you have, the loot is still just as random as it ever was. That is not a good ground for sound personal economic planning.

    6. Yes and no. Very much same as 5. Though it is not automatically so that you will always loose, so your point was a bit on the negative side. But hunting is especially annoying as the results are always very random. There is though some chance for planning, that is concentrating hunting mobs that give loot with some markup, that can be sold so that the net result would be (hopefully) often enough profit. But this has usually only a marginal effect.

    7. Not true. Deathifier bought his island years ago, and I am sure he is these days very happy about that purchase. Whereas Neverdie bought his station for 100.000 USD, made profit from it with the 4% taxes and thousands of miners and hunters there over years, and now sold it in separate transactions for 665.000 USD total i think. Land areas generally are the most certain source of income in EU and a certain way to get returns back, if handled and advertized properly. Naturally it takes some time, but result is quite certain.


    What nirfu said about the ability to understand the opportunities is very very important too. For example, I had the luck to loot the first ever vehicle blueprint in summer. First I did not realize what it means, then I was planning to sell the BP (too low price), then after some consulting with more knowledgeable friends started crafting those vehicles and sell them. Their price was very high in the beginning, but should I have waited just one week, it would have dropped to 50%. One month, and 20%.

    Honestly though, I have very lacking understanding of economics. I'm sure some more informed people will post their comments soon. :)

    Just my 2pecs.
     
  6. Kay Jones

    Kay Jones who?

    How real is the real economy? :D

    MA does not dictate, they manipulate. they can make price rise or fall, but they cant set the amount. that's the part that is up to the players. states to do that irl through subsidies and tax reductions on certain products (green energy, local agriculture, mining in germany which is about as profitable as taking a shovel and digging for oil in the desert...)

    there's inflation because we choose it to be, it's called monetary policy. if central banks wouldnt print new money, inflation wouldnt be so "normal". plus (this is what my first sentence refers to): who says a dollar is worth 10 eggs? it's some cotton and other material and some ink. you cant go to your bank and exchange it for something... you can just buy stuff for market prices.
    or let's take today's financial markets: I could login to my cfd trading program now and buy some pixels and numbers on a server somewhere in GB that would cause someone to pay me money if oil doesnt drop below X (didnt look at anything specific now). should it drop below X I in turn will have to pay that someone. and that's just something I am familiar with, there's more complicated and weirder stuff out there...

    or you might render the material worthless, because noone needs your product and your company goes bankrupt.

    skill, yes, defianately. technology, not necessarily. you could by machines for a factory that can produce meatal objects with an accuracy of 0,0001 mm but that would be plain stupid if all you produce is tin soldiers...

    tbh that annoys the hell out of me, but it's the point of the whole idea: what is supposed to matter are your avatars skills, not yours.

    not for most people, no.

    he will earn from it. when he will finally break even, that depends on him. in this particular case it will probably take a while, since players will spread across the universe soon. even if they just go to explore the planets out of curiosity, they'll be gone for who know's how long before they return to calypso. and then he has to bring them to his part of the asteroid...

    I can relate to all of that except for the "must be". it doesnt have to be anything. but the marketing should be different. I saw a video of PE on I think it was CES 2008, not sure, where some guy was interviewed and told the reporter that sweating was fun. how's that for honest marketing :jump:

    see my answer to 2.
     
  7. Nobatti

    Nobatti Guest

    In the context of this game RCE means that the items in the game are convertible to real world money. That's about it really. So, much more real cash than economy. The elements of an economy that are represented are mostly reflected in player to player trading and the behind the scenes meddling by the "balancer".

    All that other stuff like increasing skills and having better results and all that, well, results are a whole lot less economy. Think slot machine
     
  8. you miss something your own post talks about... You mention real world inflation and how you forsee prices going down on real estate in game. You can use that to your advantage... buy when the prices lower, then later when they are up you can sell. Also, if prices don't fall as you predict, buying now is smart because with real world inflation, it'll work like real world housing market was about 20 years ago vs today... Most houses these days irl that are selling for 100k were originally bought for 50k roughly about 20-50 years ago... Think about that... That means if you buy virtual real estate now, it might be worth double the money later... and due to inflation, you will have paid less for it now then you would be later.
     
  9. AxeMurderer

    AxeMurderer Master Of Entropia

    I don't agree with most of you, but to explain myself will take few hundred pages as it seems. :openmouth:

    Instead I will go in other direction. As a matematician I can add 1+2 and get 3 as result.
    We have:
    1.MA profits only from decay (if we can trust them) :handjob:
    2.People say they loose tons of money (in other things than decay - like amunitions and other stuffs) (if we can trust all the trolls :banghead: on the forums). And MA say this money go back into the economy.
    3.MA_income_aka_decay = People_loosing_tons_of_money - X

    Where X must be People_making_money but they don't talk about it.

    In other words if you spend 100 PED's today and 1 PED of them goes to decay (in MA pocket) the other 99 PED's must go to some other player right.
    There is 2 posibilities:
    1.MA don't tell the truth :handjob:
    or
    2.we are not alone, there are people making money in EU. :yay:

    And there is only 1 way to prove that. I am going to make some PED's :evil: here goes the song SHOW ME THE MONEY
     
  10. Kay Jones

    Kay Jones who?

    I'm not gonna re-read all the posts, but I cant remember anyone saying that no-one was making a profit.
     
  11. Thorn

    Thorn Proud CND Baby

    I can`t get into all the little details. But obviously the "cash" is "real". On the economy side players do have final say in what they are willing to pay or not for things which creates our markets. But they can only work within the supply that MA is willing to create and allow. So in this case it can never be a true free economy in the way most people think about one.
     
  12. I was going to reply to each number portion with specific detail, but hopefully, if I focus on #1 perhaps that can help you understand the others a bit better.

    First, please understand there are actually two prices to every item that you have to consider:
    1. TT vaule
    2. Markup (MU for short)
    If you can understand this and how each part affects the economy, you will be able to answer all your questions.

    However, let me give you a lesson about the supply & demand issue. The problem is most folks focus on the first part, and ignore the latter. Prices go up and down all the time, and always because of player desires.

    Yes, MA/FPC/RT/whoever can create missions and events that encourage an increase of specific activities. (I.E. hunting argos, highly increasing iron count) however, it's players choice whether to do these activities or not. I'm not hunting steel birds because they drop absolutely nothing I want. In the case of the faps they drop, the demand has stayed the same, but the supply has temporarily enjoyed a massive increase. The change in tiering has altered some prices, due to players changing their demands. Yes MA/FPC/whoever can influence the market, but ultimately if no players cared for the changes, they prices wouldn't have changed.

    Recently, while folks were complaining about the drop in narc prices, I was watching root acid increase in value. Why? Because some player(s) decided to use a lot of it, so they wanted more, so prices went up. The same thing happened to angelic flake prices rising while I saw an increase in crafting globals on weapons that used that item. BTW, know why the narc price dropped? Less folks doing massive ore amp condition crafting.

    Longu skin can sell for 200% MU. However, if no one's collecting any to texture their clothes or vehicles, you may have to wait months to sell any, unless some other person buys it, hoping to resell it for a higher price later. (Key word is "hoping")

    So in all these cases, the prices are influenced by player activities.


    Participate in the game and reflect on what has been taught to you by all these replies in this thread. There's a ton of knowledge about the game here if you are willing to learn and enjoy.
     
  13. AxeMurderer

    AxeMurderer Master Of Entropia

    What you say is true and useful.
    Just so far it looks like:
    1.There are always more sellers than buyers.
    2.The prices of 99% of the items and materials are going down. (If it's not some uber item or land or unique)
    3.The price of the materials used is greater than the price of the final product.
    I may be wrong, but that's what I see so far.
    And may be this is the only way EU can work, but it's not just like RCE.
     
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