Guild Wars 2

If gems are not truly a limited supply item then why do prices keep climbing? Why does it seem as if they have been forced to comply with the factors of supply/demand when in fact the supply is unlimited. A person spends gold, buys gems, uses em and poof! the gems disappear into thin air it seems.

So let me speculate on why gem prices are so high right now:

(1) There are more players playing GW2. More players mean that the overall gold supply gets higher — shouldnt the gem supply also scale to factor this in?

(2) New shinies keep coming out which is keeping people’s gold supply down.

So why doesn’t ANet increase the circulation of gems or otherwise stabilize their value so that they’re more affordable to purchase with in-game gold? Take into account gold/income per player instead of (how it seems) doing it based on the entire pool of gold in the game. Of course that pool will increase with more players.

Just because something is infinite in quantity doesn’t mean it can be required at an infinite rate.

Also, aren’t gems only in circulation when people pay real money to buy them?

Yes people need to sell their gems for gold. Otherwise the gem/gold ratio will keep climbing.

Wouldnt that only be true if they were simply stockpiling the gems rather than spending them? I mean if the average player has 250 gems (assuming most have 0, a significant amount have >500 and maybe 5% of the population has >1500). If gems are used to buy things, then they should theoretically go right back to the TP. That makes sense, and it makes sense if it’s done that way.

However, there is a deeper issue behind why gem prices are climbing so rapidly.

I can hypothesize one reason might be behind an /increase in players/. If Anet is not increasing gem supplies to keep match with the amount of players then the price will rise dramatically.

If Anet is not recirculating gems used to buy stuff back into the supply then the price will rise dramatically.

If people stockpile gems by the truckload then the prices will rise dramatically.

If farming has been discovered to be too effective and ANet spots that and lets some factor rise out of control or (god forbid) even removes gems from the market. Then costs will rise dramatically.

This is assuming a limited supply scenario. However there is not a limited supply, such limitations are artificial as ANet can simply tweak a couple of numbers to double the gem supply thus halving the cost or if more effort is required, then it would cost what? 8 man-hours to do?.

I admit that it’s not in the best interest of ANet to do so from a profit standpoint, and would reduce the income that they get from people buying gems with real money. However I do think that they should use whatever means they can to find out why prices are spiking so high and mitigate those means ‘as necessary’ so that a balance between profit and player happiness can be achieved (because ANet needs money to hire content designers, buy software, buy server hardware, and pay their staffers).

I am simply speculating on what the sources can be.

Gems through the gem store are not a limited supply item, and the price does not fluctuate.

Gems that can be exchanged for gold are a limited supply item – the only gems available through the currency exchange are gems people have sold for gold.

The gem market is working as expected – a highly demanded item was released (makeover kits) and people exchanged a ton of gold to get gems for it. People who noticed this sold gems and got gold at a much more favorable rate than in past weeks. The market has been relatively settled for the past day at a certain conversion ratio with minor fluctuations. Everything’s working as expected, and I get that you’re kittened, puppied, or otherwise irritated about not cashing in / high prices / life is hard, but that doesn’t mean the rules should change.

I think spending gems has no effect on the exchange rate. Neither is the amount of either in the market. Rather, its the amount and frequency of the exchanges that affect it. So theoretically, with “infinite” gold, one can continuously convert gold to gems, however as more gold are converted to gems, prices of conversion will increase. The only way for prices to come back down, imo, is for more people with gems (or buying gems via real cash) to convert those gems to money.

If there is an infinite supply of it, why don’t you have infinite number of gems?

Why is any item subjected to supply/demand when you can always get more of it?

Considering only a small subset of items are discontinued or unobtainable, by your logic, almost everything in the TP should be free.

Esrever.8613:

If there is an infinite supply of it, why don’t you have infinite number of gems?

Why is any item subjected to supply/demand when you can always get more of it?

Considering only a small subset of items are discontinued or unobtainable, by your logic, almost everything in the TP should be free.

That logic is false…which is your point…+1

That’s not what I meant at all, and I spent a great deal of the OP explaining exactly what I meant.

I was simply trying to find out why gem prices spiked to 3x since I started playing and why ANet isnt doing anything about it since they control the supply (and the supply is not limited in any REAL sense, like Oil is, supply in GW2 is just numbers in a system)

Let me repeat:

However I do think that they should use whatever means they can to find out why prices are spiking so high and mitigate those means ‘as necessary’ so that a balance between profit and player happiness can be achieved (because ANet needs money to hire content designers, buy software, buy server hardware, and pay their staffers).

Zero Angel.9715:

That’s not what I meant at all, and I spent a great deal of the OP explaining exactly what I meant.

I was simply trying to find out why gem prices spiked to 3x since I started playing and why ANet isnt doing anything about it since they control the supply (and the supply is not limited in any REAL sense, like Oil is, supply in GW2 is just numbers in a system)

I assume that the price is only calculated on a part of the supply, the gems that players sell for gold. Just like demand is only calculated on players action, Anet buys all gems up too, so the demand is infinite too.

Now, why isn’t Anet doing anything about it? Probably because they make money with higher gold-gem prices. The more gold it cost for people to buy gems, the more people will use dollars to buy gems (all other things being equal).

If I were in charge, I would have a market study done to calculate two numbers…
X: the amount of dollars that Anet wins, because more people buy gems with dollars due to the higher gems prices.
Y: the amount of dollars Anet looses, because people leave the game due to higher gems prices.

To calculate number Y, split up the players into different ‘type of players’, attaching a dollar-value to each one of them, probably depending on how much dollars they spend and how much time they spend in the game (and maybe some other variables).

Tallis.5607:

Now, why isn’t Anet doing anything about it? Probably because they make money with higher gold-gem prices. The more gold it cost for people to buy gems, the more people will use dollars to buy gems (all other things being equal).

This is the one and only reason. anet/ncsoft cares about the player insofar as their wallet. Keeping the exchange rate low is beneficial for them.

As well they should. So far as I can tell, the gems market is their only way of getting funds, beyond initial game purchases. Everything on the gems market is extra—not required to play the game. You don’t like the price, you don’t have to buy.

Complaining about the high price of gems is like complaining about how much NPR charges for coffee mugs.

Tarvok.4206:

As well they should. So far as I can tell, the gems market is their only way of getting funds, beyond initial game purchases. Everything on the gems market is extra—not required to play the game. You don’t like the price, you don’t have to buy.

Complaining about the high price of gems is like complaining about how much NPR charges for coffee mugs.

I’m not complaining, I’m stating the facts.
If I want something from the gemstore I’ll dip into the 40k+ of gems I got by buying them when they were 1g/300. I do feel bad for the people that have to pay for their gems using real money though.

I’m sure for some people there is a warm and fuzzy feeling they get from “supporting the developer” but I’m not so easily parted from my money.

There is more gold in the economy, so it takes more gold to get people to spend RL money since they can farm it themselves.

Brutal Arts.6307:

Tallis.5607:

Now, why isn’t Anet doing anything about it? Probably because they make money with higher gold-gem prices. The more gold it cost for people to buy gems, the more people will use dollars to buy gems (all other things being equal).

This is the one and only reason. anet/ncsoft cares about the player insofar as their wallet. Keeping the exchange rate low is beneficial for them.

Anet is raking ’er in!
They have no reason to change anything since the money keeps flowing from this channel.

Zero Angel.9715:

That’s not what I meant at all, and I spent a great deal of the OP explaining exactly what I meant.

I was simply trying to find out why gem prices spiked to 3x since I started playing and why ANet isnt doing anything about it since they control the supply (and the supply is not limited in any REAL sense, like Oil is, supply in GW2 is just numbers in a system)

Let me repeat:

However I do think that they should use whatever means they can to find out why prices are spiking so high and mitigate those means ‘as necessary’ so that a balance between profit and player happiness can be achieved (because ANet needs money to hire content designers, buy software, buy server hardware, and pay their staffers).

You spend a great deal explaining, but you’re still practically incorrect.
Gems are theoretically unlimited in the sense that yes, ANet can “print” however many gems they want. However, that’s not happening. Gems are only printed in the quantities produced by customers buying gems with real-world currency.

Just as oil is a limited resource based on the amount of ancient lifeforms that died and remained under pressure for thousands of years, gems are a limited resource based on the amount of real money being paid by players to purchase gems.

Ive got 3404 gems im keeping for xmas, hopefully there will be something decent to buy, unlike the lost shores event.

Actually, I do not believe that all gems bought with $$$ enter the gem/gold exchange equation, only if the gems are directly used to exchange for gold they affect the rate.

My suspicion for a while now is that Anet started out with a set amount of gems and gold in their “central bank” and through buying and selling gems with/for gold they try to increment their “gold wealth” until a point that they can buy “new gems” from themselves (print more gems, while still keeping a gold reserve) effectively destroying some of the gold from the economy and “steering” the rate as desired/needed.

It’s a way of being true to the statement that gems are controlled by the market while leaving some room to make adjustments.

As you know the cash shop is way of Anet to get funding so the gem rate was never meant to be as low as month ago otherwise Anet will never be able to sell anything from the shop (this is why Anet si so zealous about people getting gold by exploits). The rate has to steep enough as to encourage people to just use $$$ while still being perceived as obtainable. Its a very fine line but so far I think they are doing a good job.

On the bright side I suspect that the harsher the rate the easier Anet will go towards gold sinks.

Come on people, let’s face it, gems are Anet only source of income, after someone buys the game for the first time. Do you really expect the gems to have that low fixed price forever?

The gold supply in the game increases with every hour played. Every player has more money now then it had in the past. Despite the game’s gold sinks, there is inflation, and gold is getting easier and easier to obtain and thus it’s worth less. Overall you must put the same effort in getting an additional bank slot now as you had to do 2 months ago when the price was 50s. Gold to gem ratio will probably be the constant that reflect the true inflation rate of the game.

Honestly, I believe that the simple fact that you can convert gold to gems is a bonus from Anet, considering almost all the games with this type of pay2play system do not allow such a thing. The only thing that needs tweaking is the gem price of some commodities currently on the gem market, some of them seem really underwhelming and provide way less value/gem then others.

Zero Angel.9715:

That’s not what I meant at all, and I spent a great deal of the OP explaining exactly what I meant.

I was simply trying to find out why gem prices spiked to 3x since I started playing and why ANet isnt doing anything about it since they control the supply (and the supply is not limited in any REAL sense, like Oil is, supply in GW2 is just numbers in a system)

Let me repeat:

However I do think that they should use whatever means they can to find out why prices are spiking so high and mitigate those means ‘as necessary’ so that a balance between profit and player happiness can be achieved (because ANet needs money to hire content designers, buy software, buy server hardware, and pay their staffers).

Players sell gems. Sometimes players do not buy enough gems to sell to other players.

These are not hard concepts. And wanting to Anet to gerry rig the system to satisfy people is LOLbad.

~Tinfoil hat~
Because Anet is manipulating the market, I don’t blame them, it’s good business, look how juicy it is to dump that 20$ in gems right now and sell them for insane amounts of gold, my buddy has been doing it since they prices skyrocketed.

@weredragon > I think your statement depends on what you consider to be ‘insane amounts of gold’.

3 months ago the idea of having 1 gold was OMG IT’LL NEVER HAPPEN! Now the prospect of making less than 1 gold in a day hurts my heart a little bit. $20 for 40 gold is not worth it for me personally now (if you’d asked me 3 months ago I would have said OH HECK YES!), so I would never buy gems to turn into gold.

Beneficial to folks with some cash and low level characters I think, but not so much to people who are tapped out at 80 on one or more.