Guild Wars 2

I think the spike earlier today shows that there are people speculating on Gems artificially driving the price up.

It would be probably a good idea to limit the amount of Gems a player can buy for Gold to ~1000-2000 Gems per month.

For the average player nothing much would change and people who want to buy more than the limit can still buy them from ANet.

Rengaru.4730:

I think the spike earlier today shows that there are people speculating on Gems artificially driving the price up.

It would be probably a good idea to limit the amount of Gems a player can buy for Gold to ~1000-2000 Gems per month.

For the average player nothing much would change and people who want to buy more than the limit can still buy them from ANet.

Why do you think that the “spike earlier today” shows people speculating on gems?

Could you explain your reasoning please?

whiran.1473:

Why do you think that the “spike earlier today” shows people speculating on gems?

Could you explain your reasoning please?

The price rose by nearly 30% in two hours, reaching an all time high just to plummet by 40% afterwards.
Obviously a lot of gold has changed owner during that time, and it’s not a far cry to assume the market was manipulated with.

Rengaru.4730:

The price rose by nearly 30% in two hours, reaching an all time high just to plummet by 40% afterwards.
Obviously a lot of gold has changed owner during that time, and it’s not a far cry to assume the market was manipulated with.

I looked at the spike. I agree with the implication that a lot of gems were bought or ArenaNet had a quirk in the system.

What I don’t get is how that leads you to market manipulation. To what end? Explain the underlying logic you have that makes the leap from an accurate observation to a belief that there is gem purchasing speculation of some sort.

If you could lay out how you connected the dots and could postulate as to the desired results of any speculator I would appreciate that.

From looking at the graph, at the highest point of the spike the gem → gold rate was 1g 66s 34c per 100 gems (at around 15:11 GMT if my time conversion is accurate – the graphs display local time for me).

To make a profit buying gems with gold and then reselling them, the latest time they could have purchased gems was around 10:25 GMT when the gold → gem rate was 1g 65s 88c per 100 gems.

The actual spike looks to have started at about 11:09 GMT, so in order to profit, any potential “manipulators” would have had to purchase gems with gold at least two and a half hours before the spike even occured (and then managed to sell at the peak rate).

Because of the time delay between these two “points of profitability” and the actual spike itself, it’s extremely unlikely the spike was caused by people trying to manipulate the exchange for profit. If it was, then they would in fact have lost gold in the attempt.

I was assuming that the only explanation for the spike was manipulation by speculators.

But you are probably right.
In the light of the recent announcement of the upcomming Wintersday Event it might just have been people hoarding Gems for outragous prices.
(Still, who would actually buy at over 2 Gold -> 100 Gems when the average price is around 1.65)

However, I still think it would be a good idea to limit the amount of Gems you can buy for Gold.
It keeps speculators and people who buy gold from third parties from messing with the market too much.

But it looks so much better on the reports to say “hey, look at how much activity we had in gems this month!”

But yes I fully agree. Limit the amount of gems you can buy through gold to keep people from buying gold from third party sites and converting it.

This also makes people buy gems from ANet.

Practically speaking, I imagine that restricting how many gems could be bought with gold, without restricting how many could be bought with RL money at the same time, would be one of the worst PR things that ANet could do. Right now, when people claim that they are “forced” to spend real money, there’s always the counter that you can get gems with gold. Restricting amounts actually does force people to spend RL money, particularly if they want to get a deluxe game upgrade, and a few other big price items in a month. Imagine getting the game upgrade, and then finding out that you’d either have to wait a full month to get a makeover kit, or have to spend money for it. You’d get a lot of annoyed people.

Think of those of us who have to read through all the complaints! :p

Rengaru.4730:

I was assuming that the only explanation for the spike was manipulation by speculators.

But you are probably right.
In the light of the recent announcement of the upcomming Wintersday Event it might just have been people hoarding Gems for outragous prices.
(Still, who would actually buy at over 2 Gold -> 100 Gems when the average price is around 1.65)

However, I still think it would be a good idea to limit the amount of Gems you can buy for Gold.
It keeps speculators and people who buy gold from third parties from messing with the market too much.

Does cash-to-gems have an effect on the price of gems? If not, it could have ramifications for currency manipulation.
If cash-to-gems has an effect on the price of gems, then this could have caused the spike as people rush to buy the new makeover kit, perhaps.
A huge influx of cash-to-gems-to-gold could cause problems with the market.

whiran.1473:

What I don’t get is how that leads you to market manipulation. To what end? Explain the underlying logic you have that makes the leap from an accurate observation to a belief that there is gem purchasing speculation of some sort.

If you could lay out how you connected the dots and could postulate as to the desired results of any speculator I would appreciate that.

The thing is, you have to remember that if someone is actually strong enough to manipulate the market, they are not playing the same game you are. Let’s try an example.

Say I already have 100,000 gems. I’d like to sell them for gold. But why sell them for (let’s say) only 1g15s per 100, when I can make the market better? So I buy 500,000 gems with the >5000g I have liquid. BAM: the market jumps up to (let’s say) 1g50s per 100. Then I dump all 500,000 gems for a tidy profit.

This is the type of game some players are playing. Welcome to capitalism.

Sorry, my example wasn’t clear enough, and I messed up one of my numbers. Makes me wish I could edit posts:

Let’s say I have 100k gems that sell for 1.15g /100 (normally that would make me 1150g). I can buy gems for (let’s say) 1.5g /100. I buy 400k gems for 6k gold, and drive the sell price up to 1.45g. Then I sell all 500k gems for 7250g. Total profit: 100g.

I lost .05g on selling the 400k, but I made .3g on selling the 100k. I make enough from the uptick on the smaller amount that it more than covers a slight loss on the larger amount.

Plus, once the market crashes, I could buy back all 100k gems I started with for (let’s say) 1.2g, and still come out ahead by 50g. That means I started and ended with 100k gems and I made 50g out of thin air. All this is done with zero effort or risk, and all it takes is a massive amount of capital.

Certainly this is all hypothetical, but I tried to make the numbers similar to what happened. In the end, if you’re looking at that graph with the two lines and one line goes past another, someone is making money.

So thats not possible to do back to back heres why tax they tax the piss out of gold for gems an you would lose money now say you bought the gems along time ago watched iy rise then sold sure ur playing with them like they are stocks but in order to make money off that tax they charge u need a significant increase

I don’t really understand what you’re saying, Wobels, but I assure you my example takes the gap between buying and selling gems into consideration.

So say i want to buy 100gems and it costs 1g25s. if i turn around and sell the 100gems for gold i would only get 1gold. im not sure exactly what the tax rate is but i know its really steep. the only way to make gold off of doing that would be to buy some gems and hold them until the price received would be higher then price paid to make money at it. Its hard to figure out exactly what the tax rate is. And how much buy drives the price up but im sure its in anets favor.

An the spike didnt happen from buying gems with cash cause the cash for gems option was disabled when this spike happened i think its more or less anet made a change to the market when they brought it down which caused a spike and people with gems at the time either took advantage of the sell option at the time cause it was still enabled or anet brought it back down to its normal rate before they changed something

Gem prices will spike or fall depending on different circumstances. You cannot control it 100%. You say you want to stop people from playing the gem market, but by limiting how many gems people can buy you are also hurting people who “legitimately” are buying gems for goods and services.

Here’s an example. A couple months ago I bought 2,000 gems with gold for the deluxe upgrade. Under your current rules that you are suggesting, I would not be able to purchase anything else from the black lion store for the rest of the month.

Kojiden.8405:

I would not be able to purchase anything else from the black lion store for the rest of the month.

You could buy them from ANet, supporting the game.

If you can’t, for any reasons, you could wait a month.
It’s not like you can’t play without the Cahs Shop anyway.

Manipulation is impossible unless there’s a bug in the code. Your analysis is fatally flawed: The gems are not purchased all at once, but rather in small batches. After each batch is bought, the price rises slightly. Their actual cost will be the average of all of their purchases.