Guild Wars 2

UrieltheFlameofGod.8643:

It’s pretty ridiculous to suggest that micro-manipulation is not occurring. It’s the only way to make any money in this game.

I can make profits by placing buy orders at above the current buy rate and reselling at below the current sell rate. How am I manipulating the market?

There may be some incidents where a segment of the market is being manipulated by an individual or a group, but the global nature of the TP means that these incidents are short term in duration and the market corrects itself pretty quickly.

I really don’t see a problem with the way the market currently works and there’s nothing wrong with people making money off of it. At the end of the day, what’s all that gold really worth? A certain item can only become so expensive before everyone decides that farming that item is the best way to make money so they would all go farm it and increase the supply.

The only problem with that system imo happens when an item is really problematic to obtain making the TP the only viable option to get it. This is something I feel happened with the precursors, but these are already being adressed so all will be well as far as I see it.

Same with charged lodestones. I figured I need to do 1000 CoE runs to get 100 charged lodestones (counting core to lodestone conversion) if I continue to get them at the current rate. If I would want to make Mjolnir thats even 3500 runs…

John Smith.4610:

I would also be curious to know what evidence you see of market manipulation.

There are threads on this very forum telling players how to do it.

Flipping is causing the most harm and players are teaching each other how to do it right here in this very sub-forum.

As to “How to stop them” ideas, I have none other than increasing drop rates. Especially on materials during collection/salvaging.

I’m not an economist, I’m just a computer administrator/repair tech.

What harm is caused by flipping?

Side note: What people call “flipping” in this game is better described by the term “scalping”, which is a form of arbitrage.

I agree with the first 2.

It would make the TP less of an absolute pain for those who want to use it as intended (to trade with other players for things we looted or need to use).
I’d pretty much never buy something and need to sell it again within 3 days.
I’d pretty much never sell something and need to buy more within 3 days.

Middlemen infest the market now. 1 person gaining lots of money for little work at the expense of the many.

I can understand people anticipating market trends and buying a bunch of something hoping it will rise in price in a week or two. They would be exempt from this suggestion as it only applies a cooldown.

And also, I’ve seen “prove it” a couple of times here being said by the people who hold and don’t share the evidence. It does not endear the company to me.

Clark Skinner.4902:

I agree with the first 2.

It would make the TP less of an absolute pain for those who want to use it as intended (to trade with other players for things we looted or need to use).
I’d pretty much never buy something and need to sell it again within 3 days.
I’d pretty much never sell something and need to buy more within 3 days.

Middlemen infest the market now. 1 person gaining lots of money for little work at the expense of the many.

I can understand people anticipating market trends and buying a bunch of something hoping it will rise in price in a week or two. They would be exempt from this suggestion as it only applies a cooldown.

As one of the middlemen that are “infesting” the market, let me try to explain how my actions are actually beneficial to those who just want to sell stuff they looted/crafted or buy goods to use.

Firstly, I place buy orders at a rate that is generally at or above the current going buy rate. This gives players who just want to sell their stuff straight away more money for their goods than they would have otherwise received.

I then place sell orders for those goods at a rate that is generally at or below the current going sell rate. This gives players who want to receive the goods they are buying straight away the ability to pay less for those goods than they would otherwise have cost.

Yes, I make a profit, but I also provide liquidity in the market by being an immediate buyer and seller of goods, and the actions of players like myself repeated multiple times help narrow the margins between the buy and sell prices of goods on the market.

I’d love to see a scatter plot where each point represents a player. The y-axis would be total transactions on the trading post, the x axis would be the total value of the player’s account (use the current market value of all items on the whole account if you could sell everything on the TP or to a vendor taking the highest offer for each item).

Do similar plots but do one for value against play time, DE’s completed, Anet points and skill points. I’d be curious to see which is most strongly correlated with wealth. I’ll place my bet on TP transactions having the strongest correlation.

But the biggest thing I’m seeing here is a difference in what constitutes market manipulation. Some people consider flipping items as manipulation. But to an economist’s ears that probably sounds a lot like “market making.” I’d suggest that in a digital world market making shouldn’t be left to players because centralizing huge amounts of wealth on individual accounts is a source of other in game headaches.

Magikker.9243:

I’d love to see a scatter plot where each point represents a player. The y-axis would be total transactions on the trading post, the x axis would be the total value of the player’s account (use the current market value of all items on the whole account if you could sell everything on the TP or to a vendor taking the highest offer for each item).

Do similar plots but do one for value against play time, DE’s completed, Anet points and skill points. I’d be curious to see which is most strongly correlated with wealth. I’ll place my bet on TP transactions having the strongest correlation.

But the biggest thing I’m seeing here is a difference in what constitutes market manipulation. Some people consider flipping items as manipulation. But to an economist’s ears that probably sounds a lot like “market making.” I’d suggest that in a digital world market making shouldn’t be left to players because centralizing huge amounts of wealth on individual accounts is a source of other in game headaches.

It’s an interesting idea, and could be a good area for study. While I also suspect that TP activity would have the strongest correlation to overall wealth, a large contributing factor to that would be because other activities are generally geared to other types of rewards that aren’t exclusively financial in nature (e.g. time spent running dungeons for a desired skin can be financially rewarding, but the ultimate reward from completion has a value to the player that can’t be measured solely in financial terms).

The problem of centralizing wealth in a digital market is also quite complex. I guess the main issue is to what degree does this restrict opportunities for new entrants into the market. My (uneducated) guess is that the size of the market helps restrict the formation of monopolies or cartels which should help with some of the problems this wealth centralization can cause in the real world.

Astraea.6075:

Clark Skinner.4902:

I agree with the first 2.

It would make the TP less of an absolute pain for those who want to use it as intended (to trade with other players for things we looted or need to use).
I’d pretty much never buy something and need to sell it again within 3 days.
I’d pretty much never sell something and need to buy more within 3 days.

Middlemen infest the market now. 1 person gaining lots of money for little work at the expense of the many.

I can understand people anticipating market trends and buying a bunch of something hoping it will rise in price in a week or two. They would be exempt from this suggestion as it only applies a cooldown.

As one of the middlemen that are “infesting” the market, let me try to explain how my actions are actually beneficial to those who just want to sell stuff they looted/crafted or buy goods to use.

Firstly, I place buy orders at a rate that is generally at or above the current going buy rate. This gives players who just want to sell their stuff straight away more money for their goods than they would have otherwise received.

I then place sell orders for those goods at a rate that is generally at or below the current going sell rate. This gives players who want to receive the goods they are buying straight away the ability to pay less for those goods than they would otherwise have cost.

Yes, I make a profit, but I also provide liquidity in the market by being an immediate buyer and seller of goods, and the actions of players like myself repeated multiple times help narrow the margins between the buy and sell prices of goods on the market.

You’re giving the person selling their item 1c more. You’re taking 15% of the money that would have come from that transaction and giving it to the tax man. If you weren’t there, the person buying below you would have gotten their item sooner and that 15% would not have been destroyed.
You consider it a benefit to save people from having to wait, yet you’re causing people who already have the item up for sale to have to wait, so any benefit is negated.

Clark Skinner.4902:

You’re giving the person selling their item 1c more. You’re taking 15% of the money that would have come from that transaction and giving it to the tax man. If you weren’t there, the person buying below you would have gotten their item sooner and that 15% would not have been destroyed.
You consider it a benefit to save people from having to wait, yet you’re causing people who already have the item up for sale to have to wait, so any benefit is negated.

Some very good points.

With respect to the 1c more, I sometimes adjust the price by more than this, but the most important part is that I’m not the only one doing this, so the buy price is likely to have been adjusted upwards multiple times. Yes, it may mean people have to wait longer to receive items they wanted to buy at the lower price, but you can also assume that they were prepared to wait in order to buy at that lower price in the first place. The same principle holds for those selling goods.

As an aside, I also use the TP for buying materials to level crafting. Sometimes I will place buy orders if I’m not in any rush for the materials, and other times I will pay at the sell rate if I want to use them immediately. This is the trade-off I am prepared to make of time vs. cost, and I even use it when selling items on the TP.

What I and the others engaged in this activity are doing is reducing the price spread between buy and sell prices by assuming some of the risks and opportunity costs involved in putting up buy offers and listing items for sale. We have a trading post where players can signal to others both how much they want to pay for and item and what price they are willing to sell that item for. Traders like myself work in the margin between these 2 values and help to bring them closer.

Why would you want to reduce it? It’s supposed to be a free market is it not?

Astraea.6075:

Some very good points.

With respect to the 1c more, I sometimes adjust the price by more than this, but the most important part is that I’m not the only one doing this, so the buy price is likely to have been adjusted upwards multiple times. Yes, it may mean people have to wait longer to receive items they wanted to buy at the lower price, but you can also assume that they were prepared to wait in order to buy at that lower price in the first place. The same principle holds for those selling goods.

As an aside, I also use the TP for buying materials to level crafting. Sometimes I will place buy orders if I’m not in any rush for the materials, and other times I will pay at the sell rate if I want to use them immediately. This is the trade-off I am prepared to make of time vs. cost, and I even use it when selling items on the TP.

What I and the others engaged in this activity are doing is reducing the price spread between buy and sell prices by assuming some of the risks and opportunity costs involved in putting up buy offers and listing items for sale. We have a trading post where players can signal to others both how much they want to pay for and item and what price they are willing to sell that item for. Traders like myself work in the margin between these 2 values and help to bring them closer.

There’s nothing wrong with buying mats you intend to use or keep at a low price.

A person putting a buy order in is prepared to wait to get the item in reasonable time. They aren’t prepared for another person to put a buy order on top for 100 of the item so they will never actually get it. Playing the middleman stops trades for those people to give 1 person the discount that would have gone to many. If it wasn’t for that, one could just put an order in and feel confident that waiting a day or 2 would have the order fulfilled. But now you have to check it every 20 mintues to see if someone has halted trade with their massive middleman injection.

If you think of it this way: You go to the grocery store to get oranges since they are on sale 50% off. When you arrive, you find 1 person has bought the entire 50lbs of oranges and in their rush they dropped 15% of them on the floor. They then turn around to sell them to you at the full price. How would you react?

Clark Skinner.4902:

If you think of it this way: You go to the grocery store to get oranges since they are on sale 50% off. When you arrive, you find 1 person has bought the entire 50lbs of oranges and in their rush they dropped 15% of them on the floor. They then turn around to sell them to you at the full price. How would you react?

That’s a terrible analogy, as it assumes you’d get them in the same time were it not for that person.
The reason sell orders exist is to get them now, whereas for buy orders you’d have to wait. In this case, someone’s done the waiting part for you.
It’s more like: you want oranges, but don’t want to go to the store, so you get someone to bring you oranges, paying more than they did.

Clark Skinner.4902:

You’re giving the person selling their item 1c more. You’re taking 15% of the money that would have come from that transaction and giving it to the tax man. If you weren’t there, the person buying below you would have gotten their item sooner and that 15% would not have been destroyed.
You consider it a benefit to save people from having to wait, yet you’re causing people who already have the item up for sale to have to wait, so any benefit is negated.

I have no idea how you get the idea that 15% of the money get ‘destroyed’ ONLY by those people ‘flipping’ items.
In order to put up a sell order, everyone has to pay a 5% fee and when the item is sold another 10% are added.

If someone wants to sell an item at a specific price and someone else ‘cuts’ him, even with a greater number of items, he will sell the item if he put it up at a price that is within the fluctuation of the price curve, created by supply and demand.

If we are talking about the person who uses the TP ‘as intended’, he should not have a problem selling his item a few days later.

I’m sorry to those who think that the TP should be only used in certain ways, but you’re totally wrong.

The TP is part of a game. It has gameplay.

Because it has gameplay, you can perform various actions, using your knowledge, and you will gain some sort of outcome or reward.

There are ways to make a profit just by playing the market. This is intentional – because some people enjoy playing the market. It’s part of the game they like playing.

If the person doesn’t do it right, or gets unlucky, he might lose money. Either his flipped item never gets sold, or he’s forced to relist at a lower price to get something back, etc. So there’s risk involved as well – it’s not guaranteed money (unlike farming.)

I think the way to improve the market is to add more information, just like a real stockmarket. I want to know the volume of a particular item type that has been traded recently, and the price of recent trades, and the average price of trades made recently.

This makes it easier to spot flippers – because we can see that they are trying to sell an item for higher than the average or previous price. I then make the choice – do I want the item badly enough to pay more? Or do I put a buy order at the average price and wait for someone to fill it?

Gameplay.

Rieselle.5079:

I think the way to improve the market is to add more information, just like a real stockmarket. I want to know the volume of a particular item type that has been traded recently, and the price of recent trades, and the average price of trades made recently.

This makes it easier to spot flippers – because we can see that they are trying to sell an item for higher than the average or previous price. I then make the choice – do I want the item badly enough to pay more? Or do I put a buy order at the average price and wait for someone to fill it?

Gameplay.

That info is already available.

DavidMonthen.4398:

Why would you want to reduce it? It’s supposed to be a free market is it not?

Why should it be a free market? Digital economies and real economies are very different. What makes you think that what works for should work for the other?

DavidMonthen.4398:

Why would you want to reduce it? It’s supposed to be a free market is it not?

I’m not an economist (nor do I play one on TV), but I’ll try to answer this as best as I can.

In a “perfect” market, buyers and sellers would know the exact value of the goods they are trading in at any particular point in time. Buy orders and sell listings would then be placed at that value and there would be a perfect match between supply and demand at that point in time.

What we have in reality however is a lot messier. Buyers and sellers are both “guessing” at the value of the goods they are trading in, although they have some information to help them arrive at the value (e.g. current buy and sell listing prices and volumes). Some buyers elect to take the best available sale offer, and some sellers elect to take the best available buy offer, but everybody else puts up an offer that is usually in between these two values.

The actions of traders like myself, help to reduce the spread between these 2 prices and therefore move both buy and sell prices towards the point where supply will match demand.

Astraea.6075:

DavidMonthen.4398:

Why would you want to reduce it? It’s supposed to be a free market is it not?

I’m not an economist (nor do I play one on TV), but I’ll try to answer this as best as I can.

In a “perfect” market, buyers and sellers would know the exact value of the goods they are trading in at any particular point in time. Buy orders and sell listings would then be placed at that value and there would be a perfect match between supply and demand at that point in time.

What we have in reality however is a lot messier. Buyers and sellers are both “guessing” at the value of the goods they are trading in, although they have some information to help them arrive at the value (e.g. current buy and sell listing prices and volumes). Some buyers elect to take the best available sale offer, and some sellers elect to take the best available buy offer, but everybody else puts up an offer that is usually in between these two values.

The actions of traders like myself, help to reduce the spread between these 2 prices and therefore move both buy and sell prices towards the point where supply will match demand.

But sometimes I’m in such a rush, that I don’t care to guess, and will put up numbers that will guarantee I get my items within seconds. I guess I’m one of those on the extreme. Then the problem is when people see my numbers, and base their decisions on my poor price choices.

Smooth Penguin.5294:

But sometimes I’m in such a rush, that I don’t care to guess, and will put up numbers that will guarantee I get my items within seconds. I guess I’m one of those on the extreme. Then the problem is when people see my numbers, and base their decisions on my poor price choices.

And that’s perfectly fine… I will quite often do a similar thing when buying/selling stuff that isn’t related to my trading activities. I’ll fill buy offers just to get the money now, or pay the current listing price for mats I want to use straight away, or put stuff up at some kind of mid-point between the two prices. Someone is likely to have made some (extra) profit from these transactions, but I got what I wanted straight away and could move onto the next thing I want to do so I don’t really care.

ilr.9675:

John Smith.4610:

market manipulation.

… well that’s unfortunate that the head Econ guy doesn’t see “Flipping” as Manipulation.

I’m just curious what else you’d call it when the entire point is to manipulate the final sales price for a bigger profit on something that would have been a lot cheaper if there was no short-term speculating middlemen driving up the prices.

Flipping an item lowers its price – if an item is flipped often enough the buy and sell orders will be within coppers of the 15% charge for using the trading post.

Vorpal Smilodon.3025:

ilr.9675:

John Smith.4610:

market manipulation.

… well that’s unfortunate that the head Econ guy doesn’t see “Flipping” as Manipulation.

I’m just curious what else you’d call it when the entire point is to manipulate the final sales price for a bigger profit on something that would have been a lot cheaper if there was no short-term speculating middlemen driving up the prices.

Flipping an item lowers its price – if an item is flipped often enough the buy and sell orders will be within coppers of the 15% charge for using the trading post.

1) Holy moly, necro.

2) Hahahah yea, flipping lowers the price, that’s why ppl do it, to LOSE money.

Flipping, cornering, scalping, whatever the market manipulators do or however it’s called, it’s being done to make money. That money has to come from somewhere, namely other players. And that money also has to cover the 15% reselling tax + margin and that is the loss a player incurrs if he buys from the manipulator instead of the original seller.

And JohnSmith…so easy to check if anyone is manipulating stuff… just check players who have 5.000-10.000g+/gazillion gems and their actions. So hard right? I know, I feel your pain at losing 1hr to do it.

Novalight.7568:

Vorpal Smilodon.3025:

ilr.9675:

John Smith.4610:

market manipulation.

… well that’s unfortunate that the head Econ guy doesn’t see “Flipping” as Manipulation.

I’m just curious what else you’d call it when the entire point is to manipulate the final sales price for a bigger profit on something that would have been a lot cheaper if there was no short-term speculating middlemen driving up the prices.

Flipping an item lowers its price – if an item is flipped often enough the buy and sell orders will be within coppers of the 15% charge for using the trading post.

1) Holy moly, necro.

2) Hahahah yea, flipping lowers the price, that’s why ppl do it, to LOSE money.

Flipping, cornering, scalping, whatever the market manipulators do or however it’s called, it’s being done to make money. That money has to come from somewhere, namely other players. And that money also has to cover the 15% reselling tax + margin and that is the loss a player incurrs if he buys from the manipulator instead of the original seller.

And JohnSmith…so easy to check if anyone is manipulating stuff… just check players who have 5.000-10.000g+/gazillion gems and their actions. So hard right? I know, I feel your pain at losing 1hr to do it.

OK, so (using the example of flipping) who specifically does the marketeer hurt
?

Novalight.7568:

2) Hahahah yea, flipping lowers the price, that’s why ppl do it, to LOSE money.

Flipping, cornering, scalping, whatever the market manipulators do or however it’s called, it’s being done to make money. That money has to come from somewhere, namely other players. And that money also has to cover the 15% reselling tax + margin and that is the loss a player incurrs if he buys from the manipulator instead of the original seller.

Flipping generally lowers the current sell price of items, people do it when there is a large enough margin between the buy and sell prices to make a profit after fees are taken into account.

As a flipper, I’m not manipulating the market, but rather working within the existing market and using my time and gold to make a profit while also providing better value to people who want to buy or sell items immediately by raising the return they get for selling to lowest buyer and lowering the cost for buying from the lowest seller.

Who gets hurt?

People who need that item for crafting, legendaries, etc. People who are trying to farm for gold to get something, only all the top-tier items are priced for people who make massive fortunes doing things that would be illegal if the TP was the real stockmarket.

I’m all for a free market IRL. But this is a game. I play to have fun. Not to worry about whether I’ll be able to afford something because someone cough Logun cough has been manipulating market prices so they can make a killing for the joy of trolling other players.

‘Playing’ the TP means treating the PvE game as a PvP game, and it messes up the PvE experience for those who play PvE. It stratifies the market so that people who actually play in the world are in a much worse position to engage in economic activity. It’s part of the reason people have disappeared into fractals, so they can hope to keep up financially. It pushes people into farming the most profitable events because otherwise they’ll be left behind. The only PvE players not impacted are those who don’t care about:
1) Having on-level gear
2) Optimizing their builds
3) Crafting
4) Saving for special events

TL;DR – Flippers and middlemen are useful in real life where transportation and business finances are actually a problem to address. Having them in-game makes GW2 economic activity a problem for everyone who doesn’t ‘play’ the market, turns the PvE game into a PvP game, and messes up incentives to play the open world.

Flipping doesn’t drive up prices. Logun doesn’t even drive up prices. Rare items are rare (and expensive) in this game due to low drop rates and high demand. Period.

TP Players.. of all different styles.. make money because people habitually offer their dropped items for sale for less than the equilibrium price. That’s all I do to make money-buy items selling for less than they are worth and reselling at value (often after mystic forging it).

They only thing that drives up prices is an increase in the gold supply. TP players reduce the gold supply, not increase it.

Gilosean.3805:

Who gets hurt?
TL;DR – Flippers and middlemen are useful in real life where transportation and business finances are actually a problem to address. Having them in-game makes GW2 economic activity a problem for everyone who doesn’t ‘play’ the market, turns the PvE game into a PvP game, and messes up incentives to play the open world.

Flippers in game do serve a productive economic purpose. For people who choose to buy immediately and sell immediately (almost always regular players), flippers bring the prices closer to equilibrium (convergence of buy and sell price 15% apart), which means giving more money to those that sell immediately, and offering lower prices to those that buy immediately. Someone is always paying in liquidity in the TP (investing money or goods by putting it in an order that doesn’t get fulfilled right away). There’s no way around the fact that such a person should have a higher profit margin in a transaction than the person who gets their order fulfilled immediately.

If I invested money into providing a large number of armors at the cheapest price, I am in fact a storefront waiting for customers who come in, buy immediately, and leave, and I should therefore be awarded with a profit.

Is this the “Trading Post” forum or the “Vendor Post”? There would be much fewer threads like this if people spent half the time educating themselves on fundamental economic principles and trading styles as they did complaining about perceived “unfairness” in the market. Every concern raised in this thread could be easily explained by one of the following concepts.

The Four Laws of Supply and Demand
Quantity Theory of Money (Think Gems)
Inflation and Deflation
Time Value of Money
Arbitrage
Value Investing
Buy and Hold
Trend Following
Swing Trading
Active Trading (Aka Day Trading or “Flipping” in GW2)

And Gilosean, despite what you may think, I did not make my GW2 fortune manipulating markets. I did it using the principles above as well as others that I’ve shared in various threads in this forum.

Just a nitpick but I think ‘flipping’ is much more akin to market making than the colloquial use of the term (“Flip that house!”) If you could set a maximum price that you would buy an item at, there’d be much less of a need for very active trading.

I suspect ANet might not want to do that because such a system would benefit very well capitalized traders more, and make it harder for people to get a foothold as a trader.

Aoreias.6384:

Just a nitpick but I think ‘flipping’ is much more akin to market making than the colloquial use of the term (“Flip that house!”) If you could set a maximum price that you would buy an item at, there’d be much less of a need for very active trading.

I suspect ANet might not want to do that because such a system would benefit very well capitalized traders more, and make it harder for people to get a foothold as a trader.

The buy in to making money on the TP is around 50s. ROI’s at pre-100g are much higher than 1000g.

Thinking on it a little more, a max purchase for feature really isn’t compatible with a system that lists the highest bid anyway.