Guild Wars 2

John Smith.4610:

Out of curiosity, how many feel that a 100% free market would be a good idea?

I do.

And the whole "no real free market exists’ thing is red herring.

What we have now for gems is a completely fake free market – you guys made an algorithm that lets the trade value shift slightly – but the algorithm has aa strong attractor for the point you would prefer.

So what we mean when we say we want a free market is that people make sell and buy order for gems with no restrictions.

Free market is bad. Keep it as it is. Theres already enough capitalism in this game.

This thread more or less started with two questions: 1) what factors run the market, and 2) why is the gem market spiking now?

We’ve addressed #1 but I’m not entirely sure we’ve really dug into the second. Yes, more people are 80, yes there are bots, yes the gem store is over-priced ($7.50 for a bank slot seems…nutty).

But none of these features are new. The increase in gem prices was slight for the first 5 weeks after launch (even though many people reached 80 within the first week or so), and then has climbed steeply in the past 7-10 days.

Gem store prices are unchanged, and while there are more 80s, I’m not sure it’s growing exponentially. Likewise, there are many people who reached 80 and stopped playing who are no longer infusing gold into the economy.

It seems to me 2 things:
1) bots getting more numerous and sophisticated
2) anticipation of a halloween event that may or may not involve gems

It leaves room to speculate as well whether ANet is manipulating the market, though as with the DR issue I agree that whatever the cause, it seems to be impacting regular players more than bots or people who buy from gold sellers.

I’m a bit concerned that this is creating a bit of a bubble in gem prices that may deflate if ANet gets control of the gold sellers and/or Halloween gem event either doesn’t happen or wraps up.

Not buying gems is somewhat changing the way I play (and arguably starting to impact my satisfaction with aspects of the game), but I’m sitting this market out for the time being. That said, if prices for the gem store itself were revisited, I would certainly consider spending RL $$ to buy gems for bag/bank/toon slots. But almost everything is significantly overpriced in RL terms.

It’s sad that our society conditions us to think free markets are a bad thing, that they only benefit the few, that abuses are ripe, and that will end badly.

I believe these things to be true:
– The current lack of transparency leads to a distrust of the current system.
– The acknowledgement of price manipulation leads to more distrust of the current system.
– Distrust causes people to either ignore the gem market, unless necessarily, and then only for a limited range of useful items.
– Artifical prices drive people to gold sellers.
– The more people that turn to gold sellers because of better value for money, the more the gem market is hurt. Which undoubtedly causes a spiraling cycle.

Now what I think would happen in a free market in which gems could be traded freely without any rate setting,

- Smart players could trade gems/gold back and forth and make a profit.
- More players buy and use gems because of their transparency and potential profitability.
- Prices begin to stabilize, possibly aided by gem sales to get the gem-gold price towards more real numbers.
- Ideally the difference in value between the gold from buying gems and the gold from gold sellers closes, and people are more willing to pay a slightly higher price to A.Net due to convenience and security.
- Gem prices are lowered and ALL players benefit from lower prices, not just the ones making a profit from gem trading.

John Smith.4610:

Venge.6893:

- The acknowledgement of price manipulation leads to more distrust of the current system.

Can you elaborate on this?

Hmm, perhaps I did not see a explicit acknowledgement. But I had thought it was inferred given all the assertions that it is happening and no comment to the contrary. In addition it seems evident given the disparity between the Gold>Gem and Gem>Gold conversions.

I’ll put it up front: I’m only commenting in this thread because I feel like my concerns will be read/heard/appreciated by the ANet development team through John Smith. Thank you for your activity in this thread and your promotion of intellectual discussion.

“Better” is such an arbitrary term. I think in the grand scheme of things, a free market approach to gems would probably drive prices far higher and far faster than they currently are rising. I also think that countless hundreds of people would invest in thousands upon thousands of gems and hoard them to sell back later at an immense profit. And while the free market we have in GW2, the BLTH, is a buyer’s market, I think the buyer of gems would be hurting a lot more than they are now.

That said, I endorse it. The transparency and player-control over the market makes it feel more fair. I also think prices would normalize more predictably in both time and magnitude, resulting in less of this “slow incline” that frustrates players as it stands. I also think a free market would net ANet more money, because as gem prices climb, people will get more bang for their buck when they spend $10 for 800 gems.

Let me elaborate on that last point for a second. I make a lot of money annually, and I really enjoy GW2. I would really like to support ANet for their hard work and to keep content coming. However, I do not feel right now (or anytime in the near future) that my cash is getting me the monetary reward in-game that it should. RMTs may be poisoning the well in this sense, but I’ll be frank with you—if I could buy T3 cultural armor for $50, I would. I might consider buying multiple sets, but probably not right away. I think that’s a fair exchange rate for the equivalent price of an expansion (in my totally arbitrary opinion based on my salary and how much money I’m willing to spend on a game). As it stands, right now, it would cost me $321.30 to buy a set of T3 cultural armor at current gem prices converted back into gold. That is incredulous, and essentially means that I will never support ANet until such time that I feel the conversion is worth it. That’s really unfortunate because I love the company, but am just not comfortable throwing money away. I think that a free market would help address that concern.

John Smith.4610:

There has been no price manipulation, there is a transaction fee, I don’t feel these are the same thing.

Then could we get transparency about how the gem prices fluctuate and why the big difference in the two different trades. With Gems>Gold and Gold>Gems usually about a 10~ silver difference last time I looked?

I love how John Smith successful shifted the topic to avoid answer the question.

Venge.6893:

John Smith.4610:

There has been no price manipulation, there is a transaction fee, I don’t feel these are the same thing.

Then could we get transparency about how the gem prices fluctuate and why the big difference in the two different trades. With Gems>Gold and Gold>Gems usually about a 10~ silver difference last time I looked?

I think this is the big issue for a lot of people. While some are prepared to have faith that there has been no manipulation of the gem/gold and gold/gem exchange rates by ArenaNet, the lack of transparency about how these rates are set leads others to doubt the extent to which the rates are “player driven”.

In my previous post, I referenced the material traders in the original GW. Having seen these in operation, I believe that the currency exchange portion has been set up in a similar fashion with respect to how the rates are determined. I don’t recall people in GW doubting that the buy/sell rates these traders were being manipulated by ANet, but it may be that the real money element to the currency exchange requires more transparency about the rate setting algorithm.

I’m assuming there is a brokering fee built into the transaction, similar to how the auction house works. Therefore a difference between the cost to buy versus the cost to sell. Also similar to stock purchases, where broker houses get a certain percentage of the transaction.

Rising Dusk.2408:

I’ll put it up front: I’m only commenting in this thread because I feel like my concerns will be read/heard/appreciated by the ANet development team through John Smith. Thank you for your activity in this thread and your promotion of intellectual discussion.

“Better” is such an arbitrary term. I think in the grand scheme of things, a free market approach to gems would probably drive prices far higher and far faster than they currently are rising. I also think that countless hundreds of people would invest in thousands upon thousands of gems and hoard them to sell back later at an immense profit. And while the free market we have in GW2, the BLTH, is a buyer’s market, I think the buyer of gems would be hurting a lot more than they are now.

That said, I endorse it. The transparency and player-control over the market makes it feel more fair. I also think prices would normalize more predictably in both time and magnitude, resulting in less of this “slow incline” that frustrates players as it stands. I also think a free market would net ANet more money, because as gem prices climb, people will get more bang for their buck when they spend $10 for 800 gems.

Let me elaborate on that last point for a second. I make a lot of money annually, and I really enjoy GW2. I would really like to support ANet for their hard work and to keep content coming. However, I do not feel right now (or anytime in the near future) that my cash is getting me the monetary reward in-game that it should. RMTs may be poisoning the well in this sense, but I’ll be frank with you—if I could buy T3 cultural armor for $50, I would. I might consider buying multiple sets, but probably not right away. I think that’s a fair exchange rate for the equivalent price of an expansion (in my totally arbitrary opinion based on my salary and how much money I’m willing to spend on a game). As it stands, right now, it would cost me $321.30 to buy a set of T3 cultural armor at current gem prices converted back into gold. That is incredulous, and essentially means that I will never support ANet until such time that I feel the conversion is worth it. That’s really unfortunate because I love the company, but am just not comfortable throwing money away. I think that a free market would help address that concern.

Completely agree here the exchange rate is just extreme. People are willing to pay for gold but take the apple store for example, the money made is not the large transactions but the smaller $1.99 – $3.99 sales.

I’d also assert the fee system is in the best interest of not only the economy as a whole, but to the benefit of the players as well. It’s much better that the players buying gems for gold not incur a fee versus the ones willing to toss real world currency at buying in game gold. The ones putting cash into the system should be the ones paying the fee.

Edit: Also to address the spike, with the announcement of the Holiday event and adding things to the gem shop, people are buying up gems.

What I’d like to see is pretty much what happens in Star Trek Online.

In ST:O, it’s the players who set the price. Much like what happens in the BLTP now. That way it’s transparent why the price is changing, and not some “behind the curtains” sums.

However before you get to that part.. the whole cash > gems > gold, needs a good looking at. I can understand Anet wanting to make a cut of any purchases, but currently it’s cheaper to buy gold from less honest places, than it is from Anet direct. And most of this is actually down to the conversion rate. Players get penalised heavily for wanting to convert from gems to gold and it that can’t be good, when there’s such a big disparity between the two currencies.

Aveneo.2068:

Just out of curiosity, but why not set a max price for items? That way someone selling it can’t simply hoard the items and sell them at ridiculous rates. They’d have to sell them at the max allowed price.

Maximum prices don’t work. If an item is valued by people at substantially above the maximum allowed price in the market, people will trade it on the black market instead. If you can’t sell a precursor for more than 50g but people are willing to pay 350g, then you either sell it in general chat (thereby annoying people with spam and losing the certainty of escrow), or you just sell it on Ebay for real-world money.

There is no finite amount of gems, no drop rate to base prices on, therefore i’m certain there is a tally system to base how much gems get bought versus how much gold in moved, therefore creating a false finite system. Also, this free market thing you speak of doesn’t exist for items that are infinite and no matter what, any manufacture of goods or seller of services does initially dictate what to sell an item for. I don’t see how what anet’s doing with the gem shop any different, which the only exception that we aren’t dealing with a limited supply.

i believe that the Gem market should be a sole trading channel used by Arenanet to fight and control the Botters and Gold Sellers.
Gem Market should never be free market economy!
many of those who cry loud for free Gem Market are Speculants and perhaps are even the ones who are responsible for the Gem Prices rising! its the fox who is crying he is hurt while the “cure” will be allowing them to sell their cheaply bought gems to players in a free market. since they can not compete with the current Gem to Gold difference they beg the system be changed. if that is not an attempt to manipulate the system i dont know what is.
for many years i said that Arenanet should have put an NPC to sell Ectos to players in always a cheaper rate than gold sellers. such a mechanism would have a ruining effect on the Proffesional Botters/Farmers Gold traders. they would have been running continously into lower and lower and thus not profitable exchange rate.
the Gem market is a good idea. but it has its flaws. its biggest flaw is the fact that gems can be exchanged back into gold. thus can be traded. so why not instead trying to cheat the Gold Sellers into a semi manipulated gem market wouldnt Arenanet start selling gold instead? always a cent cheaper than the gold sellers? atleast this will produce some REAL income to Arenanet. (games such as Second Life, offer such Gold trade system for years now, and they seem to have found the exact point of stability between real money coming in to Lindens going out) if Gems were supposed to be just Tokens to allow purchase of items found in every in game store, they should have not be made tradable/exchangable back to gold, to begin with.
TLDR:
If you want to fight the Gold Traders, Arenanet should simply sell gold in slightly better rate. and make GEMS fixed price tokens for in game store items. (which cannot be traded be traded between players, just like game store items in GW1).

I appreciate that the game doesn’t have a “free market,” as I understand it. I’m just over 50 years old and I remember the real world trouble caused by our American free market stock exchange over the years.

I readily admit that I do not fully understand economics. I understand it even less when real world markets fluctuate based on rumors, and how housing prices and bad loans started a world-wide recession. Maybe that’s not how it really works, but that’s how it looks to my working-class eye.

I don’t see how you could honestly make a free market in the game anyway. It doesn’t seem right to consider Anet a monopoly, but I can see how the parallel can be made — I just think there must be some higher-theory reasoning as to why this isn’t so. Either way, it doesn’t benefit Anet to mistreat players as a monopoly might mistreat customers to extract profit, so I’m not worried about that aspect of it.

But I wouldn’t put it past players (or gold farmers) to take advantage of other players in a free market environment. Look at pricing of Precursors for an example of gouging. Altruism and community seem to go out the window when the possibility of personal gain exists.

As far as I can tell, a great simplification of how the system currently works is that the Gem>Gold and Gold>Gem conversion rates are completely separate and based upon how frequently people use either over a period of time. More Gems turned to Gold in a short time frame, for example, means those Gems convert less efficiently. Less conversions made, and they convert more efficiently.
The problem is, this would inevitably lead to periods in which no one is willing or able to make a particular conversion because it inevitably becomes too expensive, leading to a yo-yo type effect. The prices just keep going up and down again and again because the frequency of conversions are based upon the frequency of conversions! Prices are lower, more people convert. Prices are now higher, so fewer people convert.

Rationally, it seems to me that it would be much better to link the two conversion rates; every time someone converts Gold>Gems, that conversion becomes less efficient and Gems>Gold becomes more efficient, and vice versa. Unless I’ve made some great oversight, that would keep everything relatively stable by basing it upon how popular either conversion is in relation to the other.

I’ve about given up on replying to my own thread because I can’t quote people any more. Fix the bugs in your board software please! Or better yet go buy some quality board software.

To whomever challenged me on the legality of arbitrage, you were mostly correct. Thank you for setting me straight.

The Securities Exchange Act prohibits directors, officers, and shareholders to profit from arbitrage transactions on short-swing speculation in corporate securities in certain instances.

Source: http://definitions.uslegal.com/a/arbitrage/

John Smith.4610:

Ghoest.3945:

John Smith.4610:

Out of curiosity, how many feel that a 100% free market would be a good idea?

I do.

And the whole "no real free market exists’ thing is red herring.

What we have now for gems is a completely fake free market – you guys made an algorithm that lets the trade value shift slightly – but the algorithm has aa strong attractor for the point you would prefer.

So what we mean when we say we want a free market is that people make sell and buy order for gems with no restrictions.

The intent of this was to provoke an academic debate over whether players thought a free market would be superior.

I’m not asking if you want a free market, I’m asking for players to discuss why or why not they think a free market would be better.

In other words you have no intention of addressing the issues I brought up in the OP.

The main issue here is that you should let players place buy and sell orders for Gems on the TP.

The secondary issue the way the TP is setup to begin with.

Anet sets the price depending on the average player gold/income.

Also they have to make false ups and downs in the value to make it look a little bit real.

John Smith.4610:

There has been no price manipulation, there is a transaction fee, I don’t feel these are the same thing.

No intentional price manipulation. But what about accidental manipulation from bugs in the algorithm used to set the price ?

This includes bugs where the algorithm is implemented perfectly, but the algorithm doesn’t actually do what it is supposed to do. I’m not sure how someone could test for that, especially when we don’t know what the algorithm is.

How about you publish the algorithm ANET is currently using so we can analyze it for ourselves ?

So many people have so much disdain in the idea of a free-market. The person that said they’re 50 years old and seen the failings of a free market? What country were you living in at the time? The American market hasn’t been free for at least 70 years. “Speculators will run rampant” I don’t see how that would happen in such a large and open market. Maybe an intelligent person could watch market changes and make a profit, but for someone to have enough capital to change the market is laughable at best. This isn’t the stock market with investors controlling large % of the shares. This is a currency that is very spread out with control in the hands of no one save for A-Net.

Trading Gems for Gold should decrease the Gold price of Gems for both ways, and vice versa. Currently instead of doing this, people are turning to gold sellers which means that less and less people are trading real-money bought Gems for Gold. This means the supply of Gems is MUCH smaller than what it could be and thus Gems are MUCH more pricey than they should be.

In a FREE Market, these people playing the market to make a profit, and those who now buy gems for real money from A-Net instead of the gold sellers, both drive the price of Gems down. The people making the profit wouldn’t even be able to do that until the prices settle anyway.

So to argue against the Free Market is to argue for Expensive Gems, a flourishing black market (gold sellers), and a worsening economy.

Furthermore, this “transaction fee,” if this is the only thing there is and there is no price manipulation. Then what is the fee? It’s seems to me Way too high. In the Real-World this would be a Tax, and Tax evasion is HUGE. Except regular people do it and get in trouble, while the wealthy people and businesses, just move their businesses to tax havens. I would liken this to people moving to gold sellers.

With gem cards possibly available at local retailers we may see an increase in the tp gem supply. Perhaps some of the players who dont use a credit card will buy gems direct from Anet now.

Actually what would really fix this problem is a simple 3 step process:

1. Either lower the real money cost (worth) of gems, or decrease the cost of petty short-term bonuses and consumables.
2. Allow smaller increment purchases ($1-5), and actually increase number of gems per dollar…right now spending $10-20 gets you the same price per gem.
3. Create first-time daily bonuses for team-oriented content that amount to slightly more than the worth of soloing for the same time period.

Grimwolf.7163:

As far as I can tell, a great simplification of how the system currently works is that the Gem>Gold and Gold>Gem conversion rates are completely separate and based upon how frequently people use either over a period of time.

The graph of gem exchange rates at http://www.gw2spidy.com/gem demonstrates that these 2 rates are indeed linked.

Trading Gems for Gold should decrease the Gold price of Gems for both ways, and vice versa. Currently instead of doing this, people are turning to gold sellers which means that less and less people are trading real-money bought Gems for Gold. This means the supply of Gems is MUCH smaller than what it could be and thus Gems are MUCH more pricey than they should be.

In a FREE Market, these people playing the market to make a profit, and those who now buy gems for real money from A-Net instead of the gold sellers, both drive the price of Gems down. The people making the profit wouldn’t even be able to do that until the prices settle anyway.

This would be fine if the primary concern was to maximise the number of gems that can be bought with in-game gold. What about those people who would like to maximise the amount of gold they can receive for the gems they bought with RL money? I will agree that ideally, the price should stabilize to some kind of equilibrium point, but given an ever-increasing gold supply, that is unlikely to happen (IMO).

Astraea.6075:

Trading Gems for Gold should decrease the Gold price of Gems for both ways, and vice versa. Currently instead of doing this, people are turning to gold sellers which means that less and less people are trading real-money bought Gems for Gold. This means the supply of Gems is MUCH smaller than what it could be and thus Gems are MUCH more pricey than they should be.

In a FREE Market, these people playing the market to make a profit, and those who now buy gems for real money from A-Net instead of the gold sellers, both drive the price of Gems down. The people making the profit wouldn’t even be able to do that until the prices settle anyway.

This would be fine if the primary concern was to maximise the number of gems that can be bought with in-game gold. What about those people who would like to maximise the amount of gold they can receive for the gems they bought with RL money? I will agree that ideally, the price should stabilize to some kind of equilibrium point, but given an ever-increasing gold supply, that is unlikely to happen (IMO).

Well first off I’d really like to know the currency exchange fee. In the real-world you can exchange currency for a simple 2% fee. Given the prices I would think the fee is a lot higher and if it was reduced you could get more gold for real money.

Secondly MMOs need to have a gold sink to control ever-increasing gold supply, but I believe the most effective way to do this is giving the choice to the players. The Gem Store is a perfect opportunity for this, if there were more useful or cooler items on the store then players would ideally pour gold into gems to purchase them if they had gold thus driving up the price of gems in gold. Which gets you more gold for real money if the gem store had desirable items. But alas, only some of the utility stuff is useful and I personally think the first armors they put on there look terrible.

But we have a lack of transparency about what the real numbers are and what the currency exchange transaction fee is. I’m thinking it is 15% which is Way too high for currency. This is different than the item trading post and should be treated so.

Thus it’s not the free market that would harm the gold value of your real-money, its the fee and lack of people wanting to use gems. I, think combined what I argued earlier, these things would help everything. If more people turn from the gold-sellers to buying gems with real money sure it will lower the gem to gold price, but it’s the burden of A.Net to provide the gem store with more useful items than character, bag, bank slots, or a select few boosters to offset this.

I wonder if the exchange rate algorithm uses the actual transactions in a 1:1 relationship, a different relationship, or follows market trends over short periods of time.

It is very hard for me to imagine that gems are exchanged into gold at even close to the same rate as gold into gems. It could be that the algorithm works off of the amount of gems bought with real money relative to the amount bought with gold, and more or less ignores the gems to gold conversions. The latter makes more sense to me from a business perspective. If your goal is 20% “paying customers”, then the exchange rates would settle once 20% of gems are bought with real money and 80% with gold. Either way, the point being…

Unless the rates are indeed determined by a 1:1 ratio between gold->gems and gems->gold exchanges, implementing a trading system similar to the trading post, where all gems have to be supplied by other players, would cause a drastic change in the rates. If my hunch is correct then it wouldn’t be a change for the better, if you are on the gold->gems side of things.

I am genuinely curious what everyone’s thoughts are on this.

Heaven.4385:

To John Smith,

How do you explain gem prices jumping on non peak days at non peak hours, it may be supply and demand but who’s buying all the time, I’ll tell you who…bots. Bots are ruining gem price fast. Obviously free market at this point would just ruin the game even more because of the botters. I think arena net needs to step in and slow the gem inflation or put a daily limit on how much gems can be boughten with gold per account. In the month or so I’ve been playing gems went 280/g to now 150/g, which is close to 100% inflation in that time span. I realize gems are a luxury for gold but it’s just annoying to log on and everytime need to farm more and longer everyday consistently. I haven’t been upgrading my gear as much because I’ve been trying to outrun inflation to upgrade my bag slots/bank slots and get a few extra character slots before inflation really just sucks. I wish I started playing sooner when I heard rates were closer to 500+/g but I feel bad to newer players that will be stuck with an even worse rate then me. Anyways back to the gold grind!

non peak days and non-peak hours? It’s a global economy, every single hour is peak hour somewhere. Inflation happens not because of bots, but because more and more people now have gold to spare. And when they have gold to spare, a significant chunk of those people will choose to buy gems. That’s plain common sense. Bots have no reason to buy gems. It would be stupid for gold farming bots to buy gems. Customers of gold farming botters might buy gems, but even then it’s unlikely since they bought gold in the first place because they wanted to use the gold for things like exotics, crafting mats etc.

vjek.4270:

Heaven.4385:

To John Smith,

How do you explain gem prices jumping on non peak days at non peak hours, it may be supply and demand but who’s buying all the time, I’ll tell you who…bots. Bots are ruining gem price fast. …

An interesting item of note:

During the first few weeks, when the BLTC/Awesomium interface was down more than it was up, the exchange rate would rise even when no-one could buy or sell gems. It was a perfectly smooth rising slope. No variation. Looked to be a rise of about 1c/hour or similar.

In other words: No-one was using it, and the exchange rate was rising. I’m not going to point out precisely what that means, because it’s pretty clear. If there are historical records of the exchange rate for the first 1-3 weeks after headstart, you can see it for yourself.

That is incorrect. While the rest of the BLTC was down, quite often the currency converter is the sole thing that is still up. Another thing to note is that during the period when BLTC and currency converter was down for majority of players, it was still up for a random selection of players because they were testing the infrastructure. So in reality, the Currency Converter was almost always up.

Ok then – here is WHY we should have a free(or almost free) market.
And going to explain the same thing from a few perspectives to make my point.

1 The game make is so inefficient at transferring gold that many(maybe most) people who want gold have resorted to 3rd party sellers.
This is pretty much the definition of a failed market – it is analogous to state controlled economies where the black market out grows the official economy.

2 If there was a free market the ratio of gold to Gems would increase.
This is because their is a huge over supply of gold in the total economy while at the same time the average player wants more gold.
This would be good for ArenaNet because buying gems to trade for gold would become more popular so Arenanet would make more money.
It would be good for players because right now most are either just not spending money since it seems like a bad deal or they are buying gold on scam tastic black market.

3 Gems are not very worth while to the average player currently.
Most of what they offer is only attractive to a small subset of players. The average player is not going to buy Gems unless they can get an amount of gold close to what the black markets offer now – this will only happens if you allow the Gold/Gem exchange rates to rise dramatically(as market forces would lead to.)

Free market never works in a game, ever. Most of the players who have the money to control anything at this point are not the kind of players I want to be in control, however, in a free market, they will be the ones who control it. Id rather Anet control it, not exploiters and people who used knowledge of beta to buy items nobody else knew they would need, just feels too much like insider trading. You let those people control the economy and it becomes..the rich own everything and control everything, the new player could only get items via non economy based mediums of currency like karma or dungeon tokens.

You want free market? Take a look at the prices of the precursors, there’s your free market. The exploiters are setting the prices for them, like those prices? Think they are fair?

Take eveonline for example, where one group (goons) masterminded a careful sabotage of a specific item’s supply after having gathered an extensive stockpile of it. Any new supply of said item was purchased immediatly and added to their stockpile.
(This item was Oxygen Isotopes, mined in ice belts in the game and neccessary for all station upkeep and travel fuel for a specific race of ships/stations in the game… so a VERY important item.)

Days later, said group (goons) has most of every player needing that item playing right into their hands and forking over almost all of their fortune just to keep playing.

I know that Gw2 is much more immune to that sort of player exploitative manipulation (I can’t keep you from mining Oricalcum in any effective way, even if I tried very very hard) But we are seeing that happen with the precursors as they are rare enough that some individuals managed to flip the market and control the price.

In Eve Online that sort of behavior is accepted because it was designed to be a free market, all resources created were carefully tailored to value risk vs reward and time to aquire, also, because of the many resource sinks (aka, ships blowing up for good) the demand would forever be constant without needing much tweaking, the market would stabilize and be malleable in small ways as time progresses.

Once every man, woman, alt, child, dog and cat would have their exotic/legendaries, then what? you’d have to constantly create new things for people to crave for and spend time/effort to collect it for any new market to be created.

Maybe GW2 should have whole market like EVE Online has?
If GW2 will have market like EVE and whole items, mats across all lvls will be needed i think GW2 will be very strong game at the Online Game market. ATM for me there is no economy and no market.. low lvl materials are cheeper than u can sell it to NPC, noone want them and noone need them, there is easier to farm them, players make big money very easy.. bots are banned but all what thye add on AH still stay there.. day after day prices are cheaper and cheaper … soon all players will need to farm events and sell all to NPC to earn any money.

In other hand… why EU game price isn’t the same like US Price… 10$ =/= 10€.. i live in country in europe with own money and system set € for me. € is more expensive for me than $, why i need to pay more than European players who earn € and more than US player who use $ ? Why Russian players pay in $, same players from Ukraine.

I rly whould to choose with currency i want to pay.

IMO, free market is not applicable at all to games like GW2. In real world, bad decisions on the market can have serious consequences (such as basically starving to death). In a game like GW2, making a bad decision is much less dramatic. If the market were completely free, some (more intelligent/dedicated) would be able to completely abuse it while most (who don’t take trading too seriously) would always be at loss. In the end, this would create a massive divide in the wealth, which is not good for the game. And I am not even starting on how resources work differently in real world and in GW2.

Secondly, I saw ‘EVE Online’ being mentioned in some threads here. The comparison to GW2 couldn’t be more far fetched. EVE Online’s market has much more resemblance to the ‘real world’, because a) it has physical spread (travel time between stations) and b) all the game is based on player-created items.

Plum,

The comparisons to EVE’s market are about PLEX vs. Gems, not about the player market in general.

Colonel Kernel.7506:

Plum,

The comparisons to EVE’s market are about PLEX vs. Gems, not about the player market in general.

Oh, right, sorry. I misread I though the discussion shifted more towards discussing the market overall.

If its only about gems then yes, I’d prefer a free market here. Still, a transaction fee (as long as it is reasonable) makes sense to me, e.g. buying gems should be slightly expensive then selling gems. I don’t know much about economics but I think that a transaction fee would minimise the opportunity for speculation.

But I believe John Smith already stated that the players dictate the price?

I don’t understand, why not just set the price at 100 gems = 1 gold, buy or sell? It would encourage people to sell gems for gold while increasing the money sink for gold to gems and help undercut the profit of RMT. Like a lot of people that occasionally like a nice quick gold influx for a few bucks and don’t like to go the illegal route, it makes sense and if the price per 100 gems were a full gold, people would be more likely to buy them with RM rather than spend in game currency.

I fail to see the issue with this or how it’s ab-usable?

Sorry, wanted to adds something else real quick.

AN can’t undercut the RMT without causing a huge influx of gold into the game, ruining things. My 1 gold = 100 gems idea would make buying gold (lets call it what it is) from AN more attractive for those who can afford it vs going the RMT route and all the possible issues that come with that.

Equally, while it would permanently make buying gems with gold more expensive, the price would never go up more than that and if you wanted to convert unused gems back, you would lose nothing on the trade-in. It also makes the trade between the two easy to understand.

Sure, at the lower levels, it would be harder to use the market, but at higher ends where gold is more prevalent, it creates a better money sink since not only are they spending more on gems but are more willing to do so if they know they can get that money back if they change their minds or have gems left after the desired store purchase is made.

A real-world “Free Market” discussion applied to GW2 is laughable. It can’t happen. ANet is already playing multiple market forces (taxing authority, foreign exchange rate authority, and bank (Federal Reserve and IMF) all in one.

Where in the real-world are broker fees hidden from transactions? 15% on the BL exchange when purchasing gold-for-item but there is no listed amount on the Gem-to-Gold or Gold-to-Gem markets. In the real world, it’s a crime if you do not disclose your fee rates (in the US, laws from back in 1933/1934 changed that).

I understand ANet has their reasons to hide this fee information but no one should be under the delusion that the system is anything close to Free Market or will ever even come close to one regardless if the algorithm is released or not.

Nate.8934:

… While the rest of the BLTC was down, quite often the currency converter is the sole thing that is still up. Another thing to note is that during the period when BLTC and currency converter was down for majority of players, it was still up for a random selection of players because they were testing the infrastructure. So in reality, the Currency Converter was almost always up.

I was not referring to these times. The times I was referring to were when it was publicly stated by ArenaNet to be down for everyone.

Also, your assertions indicate information not available publicly, so it would be good to quote your source. (regarding internal ArenaNet systems)

As to the updates from John Smith last evening regarding a Free Market discussion. Artaz summed it up nicely: ‘A real-world “Free Market” discussion applied to GW2 is laughable. It can’t happen. ’ That’s pretty much it.
A free market for any aspect of GW2 should not happen, ever. Just like real countries, they’re full of broken humans who will take any short term gain at the expense of any long term consequence.

In other words, ultimately you have to plan for the worst possible abuse of any system, RL or otherwise. If you don’t, you’re intentionally setting yourself up to fail. ~15 years of MMO’s have demonstrated this quite nicely. For the moment, GW2 is being held hostage by very few people who exploited early, and exploited often. Until they’re removed from the game, any semblance of fun or “fair” in the Economy is a dream.

So what, nobody wants to answer my question why a solid 1 gold = 100 gems idea is bad?

So what, nobody wants to answer my question why a solid 1 gold = 100 gems idea is bad?

If the currencies were linked at a fixed rate without transaction fees, there would be no need for two separate currencies. You could just buy gold directly from ANet instead of gems, and pay with gold in the gem store. That’s not really an argument either way though.

The gem store is a gold sink. Every time a player exchanges gold into gems, it removes gold from the game. At release, gold was scarce and you could get a lot of gems for it. As the game progresses, gold becomes much more common. The exchange rate has to keep up with the gold inflation, ensuring that gem store items are always priced in such a way that players can justify purchasing gems for real money. If it didn’t, a year or two down the line, players would have no incentive to buy gems for real money as everyone is sitting on hundreds if not thousands of gold.

I apologize if someone has already said similar above – I tried to read the entire thread, but the details of economic policies are beyond the scope of my understanding.

I’ve tried to reason out why the variable exchange rate bothers me, but others have explained it better.

For me, bottom line is this:

At launch, Gems were too expensive for me to purchase with Real Money. I had no desire to buy cosmetic items for more than a dollar or two. They were, however, very cheap to purchase with Gold. (I acknowledge that they were probably too cheap then.) So I bought some dye packs.

Now, Gems are now too expensive to purchase with either gold OR real money. My perceived value of items in the gem store has not changed, but neither method for buying them is worthwhile. I want to buy more dye packs to complete my collection, but there is no way in Kitten I’m going to pay 300% more for them now.

If you’re going to keep this flexible exchange rate for Gold→Gems, please for crying out loud give us more Gems for Cash so I can buy something for at least ONE reasonable price!

If anyone cares, this is about what I’d be willing to pay for things in the Gem Shop:
Character Slot – $5.00
Character Bag Slot – $1.00
Bank Space – $2.50
Black Lion Key – $1.00 for four
Dye Pack – $1.00
Consumable Buffs – $0.50

If prices were closer to this level, I’d be buying stuff several times a month.

I think that is the general compliant overall. Paying 60 for a full game and having the items in game extremely more expensive then the entire price of buying the game in the first place. I certainly hope they lower the costs on gem only items.

green plum.7514:

But I believe John Smith already stated that the players dictate the price?

No he didnt say that.

The price is determined by an algorithm that uses players purchases and sales as the variable.
Its not at all the same thing as players dictating price.

The way it seems to work is that there is a soft target price range or a strong attractor and player trades effect the variance around the target range.