Grand Exchange: Your thoughts?

[qeltar]

 

I just don't see why you think that people will "suddenly" be starting to make masses of pineapples, potatoes, etc? If that is going to happen then why aren't people making masses of them already?

 

...

 

Yes, you say because there is a lack of demand - but I do have to point out that lack of demand is caused mostly by a lack of supply.

 

 

The problem is an inability of those who want the items to find those who are willing to make them.

 

 

 

For example, I like making wild pies but I HATE making pie shells. I have in the past offered to pay very good money for them, but I can never find anyone who's willing to do it. Why? Because 30 seconds after I post about it on the Food forum of the RSOF, the thread is pushed down by dozens of "buying/selling sharks/lobbies" posts.

 

 

 

I'm hoping the GE will make it easier for people to find those who want to buy or sell these specialty items.

 

 

It is simply not efficient to produce them - and the GE won't change that.

 

 

You're mistaken, IMO. It's very efficient to produce a lot of items that are currently not produced only because they cannot be easily sold.

 

 

Furthermore, the price on such items will certainly become (much) lower and items like addy boots are bound to fall down to their high alch values in near to no time (if they aren't already), because there is probably an oversupply of them.

 

 

If there's an oversupply now, then the price will of course drop. It will never approach alch value because if it does, slayers will just alch them on the spot, causing supply to decrease and the price to go back up.

 

 

Either way, the liquidity on all those "unpopular" items will still improve significantly and that will be handy for anyone buying/selling any of them.

 

 

That's my basic point.

 

 

Transaction fees themself create market inefficiency, however.

 

 

Different kind of inefficiency, in this case one designed to prevent "churning" (buying and reselling the same things over and over.) This directly harms merchants far more than it does regular players.

 

 

Anyway, what I ment is that theory and practice don't always agree. Many economic theories make all kind of idealized assumptions that simply don't hold at all or don't hold completely in practice.

 

 

That's true.. though fundamentals (like markets not suddenly crashing due to a new means of exchange) do generally hold true.

 

 

And I'm fairly sure I have seen you make various of such claims as well. I believe you posted at the other thread that according to you the whole rares market in RS doesn't even represent 1% of all items in the game. Without proof or any calculations, I may add.

 

 

That comment was prefaced with "My guess is that...". Please keep claims about prior comments in context.

 

 

Price elasticity shows what a certain change in price is expected to mean for the demand of the item, according to the demand curve. Psychologic behaviour is not accounted for at all.

 

 

Psychological effects apply only to a very small number of items and markets. Most items in the game trade very simply and unemotionally based on a pure value/price equation.

[truffoo]

Qeltar vs. Duke Freedom - 2 of the more literate and economic understanding tif users. Both of you impress me with your understanding and ability to communicate it, even if you disagree on some of the details.

 

 

 

Although I didn't read the whole article, or the full discussions between you both, ultimately we will not know how GE will truely affect the RS economy until it is released. Decisions around how it works could greatly change the effects. This may have already been said.

 

 

 

Keep it up guys, we'll take score once the GE is released :shock:

[Solidus_77]

Ok, first of all, Qeltar, you did a great job writing the article. It's not easy writing about something we know so little about, and I think you explained the general terms pretty well without making too many assumptions. The economics, for the most part, about predictions are all logical and

 

 

 

I do also agree with you putting down the "economic crash" theories and similar nonsense as I really think,as you do, it's just bs.I will, however, disagree on your use of price elasticity, I prefer just explaining the concept of the "invisible hand" and price equilibrium. Price elasticity of demand or supply is used to explain, for a change in price, by how much there will be a change in supply/demand. It does not, however, adequately explain if there will be a change in price.

 

 

 

What I find odd, when reading the part about elasticity is that you talk about it like it's a force that acts upon supply and demand to give the equilibrium price. Now I believe that that is not price elasticity of demand/or supply, and unless I misunderstood the economic terminology I'm tempted to say that concept behind the movement of supply and demand is part of the "invisible hand" and not price elasticity.

 

 

 

Also, why "price elasticity" on it's own? From what I've been taught it's always either price elasticity of demand or price elasticity of supply (and others such as income elasticity of demand to explain "inferior goods" vs "luxury goods"). Otherwise, in the end, the great exchange does not change the supply or demand, they will simply find their equilibrium as they have in the past.

 

 

 

I understand the point and agree with it partly, but I don't expect that there will "suddenly" be a huge market for an item that didn't have a market before. I just don't see why you think that people will "suddenly" be starting to make masses of pineapples, potatoes, etc? If that is going to happen then why aren't people making masses of them already?

 

 

 

I think I understand the point that qeltar is getting across. Basically he is refering to a specific type of good that is considered "unsellable". These are goods, for which, there is no market meaning that the supply doesn't cross the demand (if you were to look on a graph that is). Meaning that the price is not considered high enough for producers to sell it and they are better off making something else.

 

 

 

Now, the assumption (which I support to a certain extent) is that although these goods in question take very little time to sell, are not considered "not worth it" because they take a very long time to sell at their current price. Therefore, the opportunity cost of selling is too great and the opportunity cost of buying is small enough so that most people just get the items themself

 

 

 

The great exchange, assuming there are few limitations, is aimed at severely limiting the opportunity cost of selling. Therefore, these goods are now easy to "produce" and easy to sell thus increasing the supply and therefore, if the supply increases enough, it is possible that it could cross the demand curve thus creating a market for this good.

[Duke_Freedom]

Solidus, you are indeed right about the unnecessary use of price elasticity as well as what price elasticity is. In essence price elasticity is nothing but the slope (i.e. derivative) of the price graph of the demand or the supply.

 

 

 

As I pointed it out in my posts, qeltar used it wrongly to "explain" a price change (caused by psychology or the GE) as you also noted. I believe qeltar mentioned it to point out that prices can't continue to fall in price forever ("crash"), because demand will rise and supply will fall (significantly) if prices fall. The percentual changes can be calculated with the use of the price elasticity of demand and supply, however that is not really relevant since we don't have any of those numbers anyway. Reason why I called it a theoretical concept.

 

 

 

It is simply not efficient to produce them - and the GE won't change that.

 

You're mistaken, IMO. It's very efficient to produce a lot of items that are currently not produced only because they cannot be easily sold.

 

 

 

I don't think we'll be going to agree on this point, but I think it's nice to summarize it anyway...

 

 

 

The problem we're getting into here is that we are observing two things:

 

 

 

- There are few people willing to make such items (lack of bulk supply)

 

- There are few people willing to buy such items (lack of bulk demand)

 

 

 

Now we both agree on those statements being true, however our approaches to it are different:

 

 

 

- qeltar: there are few people "aware" of the existance of the items and thus few people buy them (demand side) what in turn results in few people making them (supply side)

 

 

 

- me: there is little production due to it being inefficient to produce those items (supply side) what in turn results in few people buying them, because it is practically impossible to buy them in bulk (demand side)

 

 

 

To be honest I find qeltar's arguements extremely contradictionary (quoting the relevant statements):

 

 

 

It's very efficient to produce a lot of items that are currently not produced only because they cannot be easily sold.

 

The problem is an inability of those who want the items to find those who are willing to make them.

 

 

 

1) You state that it is very efficient to produce the items.

 

2) You also state that it is hard to find people willing to make them.

 

 

 

These two statements are completely contradictionary. You claim that it is "very efficient" to produce the items, but yet anyone who wants to buy them can't find anyone who is willing to produce them. You neglect to explain why noone is willing to produce them, while it is supposively "very efficient" to do so.

 

 

 

Essentially you are arguing that there's huge market inefficiency in a market that has been in an equilibrium for ages. Sorry, but you are defying various economic laws here.

[qeltar]

Price elasticity of demand or supply is used to explain, for a change in price, by how much there will be a change in supply/demand. It does not, however, adequately explain if there will be a change in price.

 

 

Yes, that's true. I used the term in a simplified manner, bearing in mind that my audience here is not college econ majors. :)

 

 

Also, why "price elasticity" on it's own? From what I've been taught it's always either price elasticity of demand or price elasticity of supply (and others such as income elasticity of demand to explain "inferior goods" vs "luxury goods").

 

 

I did mention both elasticity of demand and supply.

 

 

I think I understand the point that qeltar is getting across. Basically he is refering to a specific type of good that is considered "unsellable". These are goods, for which, there is no market meaning that the supply doesn't cross the demand (if you were to look on a graph that is). Meaning that the price is not considered high enough for producers to sell it and they are better off making something else.

 

 

Actually, I mean both that type of good AND markets that right now do not exist because the markets are so poor that the few numbers of buyers and sellers cannot find each other.

 

 

Now, the assumption (which I support to a certain extent) is that although these goods in question take very little time to sell, are not considered "not worth it" because they take a very long time to sell at their current price. Therefore, the opportunity cost of selling is too great and the opportunity cost of buying is small enough so that most people just get the items themself

 

 

Yes, in many cases that happens now.

 

 

The great exchange, assuming there are few limitations, is aimed at severely limiting the opportunity cost of selling. Therefore, these goods are now easy to "produce" and easy to sell thus increasing the supply and therefore, if the supply increases enough, it is possible that it could cross the demand curve thus creating a market for this good.

 

 

 

You got it.

[qeltar]

 

It is simply not efficient to produce them - and the GE won't change that.

 

You're mistaken, IMO. It's very efficient to produce a lot of items that are currently not produced only because they cannot be easily sold.

 

 

 

I don't think we'll be going to agree on this point, but I think it's nice to summarize it anyway...

 

 

 

The problem we're getting into here is that we are observing two things:

 

 

 

- There are few people willing to make such items (lack of bulk supply)

 

- There are few people willing to buy such items (lack of bulk demand)

 

 

 

Now we both agree on those statements being true, however our approaches to it are different:

 

 

 

- qeltar: there are few people "aware" of the existance of the items and thus few people buy them (demand side) what in turn results in few people making them (supply side)

 

 

 

- me: there is little production due to it being inefficient to produce those items (supply side) what in turn results in few people buying them, because it is practically impossible to buy them in bulk (demand side)

 

 

We're talking past each other because of the use of two different meanings of the word "efficient".

 

 

 

What I meant was that there are activities that are efficient in terms of them being worth doing from a cost/XP standpoint, that players will not do because it is too inefficient from a buying/selling standpoint. These are what I think the GE will change.

 

 

 

Again, as a simple example.. I like making high-level pies but I HATE making pie crust/shells. Now, you can make pie shells at a very low level, and even on F2P. I have in the past been willing to pay up to 1,000 gp each for these things, which is pretty good money for easy work. It's worth it to me to pay that much.

 

 

 

But I can't find anyone willing to do it, because there's currently no efficient way to let people know that I want them. I'm hoping the GE will change that.

[Duke_Freedom]

What I meant was that there are activities that are efficient in terms of them being worth doing from a cost/XP standpoint

 

 

 

Well that's the same notion for efficiency that I use, so no misunderstanding there.

 

 

 

that players will not do because it is too inefficient from a buying/selling standpoint.

 

 

 

Yes, I understand that is the point, but I still don't get where the buying/selling inefficiency comes from.

 

 

 

But I can't find anyone willing to do it, because there's currently no efficient way to let people know that I want them.

 

 

 

Because equilibriums would argue that if buying AND producing the item is as efficient as you claim (at the current prices!), many people would be trying to buy the items and as such people will know that such items are wanted. I still don't see a suitable explanation for why this is not the case.

 

 

 

Edit: Basically you are still suggesting a market inefficiency on certain items, where both potential buyers as well as potential sellers don't know the existance of. In that case, I still don't see how the Grand Exchange could contribute to it's popularity since the issue lies in the fact that people don't know about the item and not in the fact that it is so difficult to buy / sell the item.

[qeltar]

The buying/selling inefficiency comes from the current primitive markets.

 

 

 

To take some other examples... I can make amulets of glory from dragonstones, but I never do. Why? Because I don't want to spend time either standing in a zoo like W2 Fally selling them 1 or 2 or 5 at a time, or world hopping and dealing with people who can't read simple instructions on the forums.

 

 

 

Same with super weapon poisons and a lot of other items. I don't make them because I don't want to spend time selling them. It's not they are bad things to make, they are just too annoying to sell.

 

 

 

And the same also goes for items that require hard-to-get raw materials.

 

 

 

Another good example... battlestaffs for crafting. There is basically no market for these right now -- there will be after the GE gets going, I believe.

[Duke_Freedom]

To take some other examples... I can make amulets of glory from dragonstones, but I never do. Why? Because I don't want to spend time either standing in a zoo like W2 Fally selling them 1 or 2 or 5 at a time, or world hopping and dealing with people who can't read simple instructions on the forums.

 

 

 

It is important to note that glory ammy's are an item that goes for less when sold in bulk... So what do you think that the GE is going to do about it? Yes, it's going to make it easier to sell bulk. What does that mean for the price? Exactly, it is going to be lower.

 

 

 

Same with super weapon poisons and a lot of other items. I don't make them because I don't want to spend time selling them. It's not they are bad things to make, they are just too annoying to sell.

 

 

 

I would interpret the fact that these items are an annoyance to sell rather as an arguement that their inefficient market price is too high and any improvement in the ability to sell those items will then have to come from a lower price.

[Red580]

Wow, finally Jagex gets some sense XD.

[qeltar]

Most items sell for less in bulk in any market, but the discrepancy between the individual sale and bulk sale price is a function of just how lousy the market is. The GE will (hopefully) suck less than what we have now. This means that there is a possibility that rather than prices just going down wholesale, there will instead be a convergence between the 1-off and large-volume prices.

 

 

 

Right now if I need just one p++ and I can't get into w2, I probably have to pay 15k or 20k to entice someone to make a trade with me. Conversely, if I have 100 of them to sell I might have to take 7k for them.

 

 

 

With the GE, it may be possible instead that all the people who just want one can get it for 8k, and the people selling them would get 8k as well (less fees). Both producers AND consumers win -- the only one that loses is the merchant who used to act as a go-between.

[hbk_hossack]

Recently, there have been lot of topics about "How the GE will destroy the Economy!", "The GE will eliminate Merchanting!" and others. I see these topics as a total farce. The GE will NOT destroy the Economy or Merchanting. It will simply change the way Merchanting is done. Here are a few scenarios-

 

 

 

Player A, B and C are your regular players. Player D is a merchant. Player E is a Mage. Player F is a Pker.

 

 

 

Scenario 1-Player A,B and C sell 350 Nats for 300 ea

 

Player D also has 350 Nats. He sees these Nats for sale and snaps them up for 315k. Player D now has 1400 Nats.

 

Player D puts up his 1400 Nats for 434k, which is 310 each.

 

Player F puts up 100 Nats he got from Pking for 300 ea.

 

Player E has is looking to train his magic. He sees the 1.4k Nats for 434k, and 100 Nats for 30k. Which Nats will he buy? The 1.4k Nats of course. He needs a lot of Nats, and the small price increase is enough to pay for the convenience of obtaining all these Nats. There. Player E has made 119k.

 

 

 

What we learned from this scenario-Merchanting remains the same, buying lots of small amounts and making a large amount will make you money. 10gp or so extra per rune etc. is an amount people are willing to pay for the convenience of getting a lot of the items they need.

 

RESULT-Merchanting has not changed!

 

 

 

 

 

Player A is a Monster Slayer, with an especial like of fighting Steel Dragons. Player B is searching for Dragon Legs. Player C is a merchant.

 

 

Scenario 2

 

Player A has been slaying Steel Dragons all day and is starting to think he will never get a profitable drop. But suddenly, he finds the fabled Dragon Platelegs on the ground! Not knowing the exact price, and wanting to get back to Dragon Slaying, posts on the GE for 1.3 mill. Player C sees these, buys them, then puts them up on the GE for 1.6 mill. Player B, who has been looking all day, sees Dragon Platelegs for 1 mill more, but being desperate for a pair buys them anyway. There. Player C just made a quick and easy 300k.

 

 

 

Whate we learned from this scenario-The oldest merchant principle,. buy low and sel high, still works. People who are in desperate need of things will pay higher prcies, which is how Merchants make a lot of money today.

 

RESULTS-Merchanting has not changed!

 

 

 

Player A, B, C and D are Woodcutters on there way to 99 WC. Player E is a Merchant. Player F is a Flether who wishes to fletch to 99 and make some money.

 

 

 

Scenario 3

 

 

 

Player A, B, C and D have all cut 50k Yew logs. Player A sells his for 340 gp(1.7mill), Player B sells his for 350gp(1.75mill), Player C sells his for 360gp(1.8mill) and Plaeyr D sells his for 370gp(1.85mill). Player E sees these logs and buys all 200k for 7.1 mill. He now has 200k Yew logs, which he puts on the GE for 380 ea, 7.5mill. Player E sees all these logs, and knows he could make a lot of money, so buys them. Player F just made 400k.

 

 

 

What we learned from this scenario-Another old merchanting trick is that stuff with high supply has low demand, and low supply leads high demand. As there was a low supply of Yew logs of Yew logs on the GE, because Player E bought so many, there was a high demand, which was from Player F.

 

RESULTS-Merhcanting has not changed!

 

 

 

Those are only a few scenarios, why not share some of yours? What are your thoughts on what Merchanting will be like after the GE? Discuss and post your own scenarios here!

[Star_Fox]

http://forum.tip.it/viewtopic.php?t=716175

 

 

 

doesnt hurt if you can collapse this topic with that.

[killotroll]

Recently, there have been lot of topics about "How the GE will destroy the Economy!", "The GE will eliminate Merchanting!" and others. I see these topics as a total farce. The GE will NOT destroy the Economy or Merchanting. It will simply change the way Merchanting is done. Here are a few scenarios-

 

 

 

Player A, B and C are your regular players. Player D is a merchant. Player E is a Mage. Player F is a Pker.

 

 

 

Scenario 1-Player A,B and C sell 350 Nats for 300 ea

 

Player D also has 350 Nats. He sees these Nats for sale and snaps them up for 315k. Player D now has 1400 Nats.

 

Player D puts up his 1400 Nats for 434k, which is 310 each.

 

Player F puts up 100 Nats he got from Pking for 300 ea.

 

Player E has is looking to train his magic. He sees the 1.4k Nats for 434k, and 100 Nats for 30k. Which Nats will he buy? The 1.4k Nats of course. He needs a lot of Nats, and the small price increase is enough to pay for the convenience of obtaining all these Nats. There. Player E has made 119k.

 

 

 

What we learned from this scenario-Merchanting remains the same, buying lots of small amounts and making a large amount will make you money. 10gp or so extra per rune etc. is an amount people are willing to pay for the convenience of getting a lot of the items they need.

 

RESULT-Merchanting has not changed!

 

 

 

 

 

Player A is a Monster Slayer, with an especial like of fighting Steel Dragons. Player B is searching for Dragon Legs. Player C is a merchant.

 

 

Scenario 2

 

Player A has been slaying Steel Dragons all day and is starting to think he will never get a profitable drop. But suddenly, he finds the fabled Dragon Platelegs on the ground! Not knowing the exact price, and wanting to get back to Dragon Slaying, posts on the GE for 1.3 mill. Player C sees these, buys them, then puts them up on the GE for 1.6 mill. Player B, who has been looking all day, sees Dragon Platelegs for 1 mill more, but being desperate for a pair buys them anyway. There. Player C just made a quick and easy 3 mill.

 

 

 

Whate we learned from this scenario-The oldest merchant principle,. buy low and sel high, still works. People who are in desperate need of things will pay higher prcies, which is how Merchants make a lot of money today.

 

RESULTS-Merchanting has not changed!

 

 

 

Player A, B, C and D are Woodcutters on there way to 99 WC. Player E is a Merchant. Player F is a Flether who wishes to fletch to 99 and make some money.

 

 

 

Scenario 3

 

 

 

Player A, B, C and D have all cut 50k Yew logs. Player A sells his for 340 gp(1.7mill), Player B sells his for 350gp(1.75mill), Player C sells his for 360gp(1.8mill) and Plaeyr D sells his for 370gp(1.85mill). Player E sees these logs and buys all 200k for 7.1 mill. He now has 200k Yew logs, which he puts on the GE for 380 ea, 7.5mill. Player E sees all these logs, and knows he could make a lot of money, so buys them. Player F just made 4 mill.

 

 

 

What we learned from this scenario-Another old merchanting trick is that stuff with high supply has low demand, and low supply leads high demand. As there was a low supply of Yew logs of Yew logs on the GE, because Player E bought so many, there was a high demand, which was from Player F.

 

RESULTS-Merhcanting has not changed!

 

 

 

Those are only a few scenarios, why not share some of yours? What are your thoughts on what Merchanting will be like after the GE? Discuss and post your own scenarios here!

 

 

 

You should have spend a bit more time getting the numbers right, it's rather confusing to read.

[hbk_hossack]

Recently, there have been lot of topics about "How the GE will destroy the Economy!", "The GE will eliminate Merchanting!" and others. I see these topics as a total farce. The GE will NOT destroy the Economy or Merchanting. It will simply change the way Merchanting is done. Here are a few scenarios-

 

 

 

Player A, B and C are your regular players. Player D is a merchant. Player E is a Mage. Player F is a Pker.

 

 

 

Scenario 1-Player A,B and C sell 350 Nats for 300 ea

 

Player D also has 350 Nats. He sees these Nats for sale and snaps them up for 315k. Player D now has 1400 Nats.

 

Player D puts up his 1400 Nats for 434k, which is 310 each.

 

Player F puts up 100 Nats he got from Pking for 300 ea.

 

Player E has is looking to train his magic. He sees the 1.4k Nats for 434k, and 100 Nats for 30k. Which Nats will he buy? The 1.4k Nats of course. He needs a lot of Nats, and the small price increase is enough to pay for the convenience of obtaining all these Nats. There. Player E has made 119k.

 

 

 

What we learned from this scenario-Merchanting remains the same, buying lots of small amounts and making a large amount will make you money. 10gp or so extra per rune etc. is an amount people are willing to pay for the convenience of getting a lot of the items they need.

 

RESULT-Merchanting has not changed!

 

 

 

 

 

Player A is a Monster Slayer, with an especial like of fighting Steel Dragons. Player B is searching for Dragon Legs. Player C is a merchant.

 

 

Scenario 2

 

Player A has been slaying Steel Dragons all day and is starting to think he will never get a profitable drop. But suddenly, he finds the fabled Dragon Platelegs on the ground! Not knowing the exact price, and wanting to get back to Dragon Slaying, posts on the GE for 1.3 mill. Player C sees these, buys them, then puts them up on the GE for 1.6 mill. Player B, who has been looking all day, sees Dragon Platelegs for 1 mill more, but being desperate for a pair buys them anyway. There. Player C just made a quick and easy 3 mill.

 

 

 

Whate we learned from this scenario-The oldest merchant principle,. buy low and sel high, still works. People who are in desperate need of things will pay higher prcies, which is how Merchants make a lot of money today.

 

RESULTS-Merchanting has not changed!

 

 

 

Player A, B, C and D are Woodcutters on there way to 99 WC. Player E is a Merchant. Player F is a Flether who wishes to fletch to 99 and make some money.

 

 

 

Scenario 3

 

 

 

Player A, B, C and D have all cut 50k Yew logs. Player A sells his for 340 gp(1.7mill), Player B sells his for 350gp(1.75mill), Player C sells his for 360gp(1.8mill) and Plaeyr D sells his for 370gp(1.85mill). Player E sees these logs and buys all 200k for 7.1 mill. He now has 200k Yew logs, which he puts on the GE for 380 ea, 7.5mill. Player E sees all these logs, and knows he could make a lot of money, so buys them. Player F just made 4 mill.

 

 

 

What we learned from this scenario-Another old merchanting trick is that stuff with high supply has low demand, and low supply leads high demand. As there was a low supply of Yew logs of Yew logs on the GE, because Player E bought so many, there was a high demand, which was from Player F.

 

RESULTS-Merhcanting has not changed!

 

 

 

Those are only a few scenarios, why not share some of yours? What are your thoughts on what Merchanting will be like after the GE? Discuss and post your own scenarios here!

 

 

 

You should have spend a bit more time getting the numbers right, it's rather confusing to read.

 

What o you mean get the numbers right?

[123Yourgone]

Recently, there have been lot of topics about "How the GE will destroy the Economy!", "The GE will eliminate Merchanting!" and others. I see these topics as a total farce. The GE will NOT destroy the Economy or Merchanting. It will simply change the way Merchanting is done. Here are a few scenarios-

 

 

 

Player A, B and C are your regular players. Player D is a merchant. Player E is a Mage. Player F is a Pker.

 

 

 

Scenario 1-Player A,B and C sell 350 Nats for 300 ea

 

Player D also has 350 Nats. He sees these Nats for sale and snaps them up for 315k. Player D now has 1400 Nats.

 

Player D puts up his 1400 Nats for 434k, which is 310 each.

 

Player F puts up 100 Nats he got from Pking for 300 ea.

 

Player E has is looking to train his magic. He sees the 1.4k Nats for 434k, and 100 Nats for 30k. Which Nats will he buy? The 1.4k Nats of course. He needs a lot of Nats, and the small price increase is enough to pay for the convenience of obtaining all these Nats. There. Player E has made 119k.

 

 

 

What we learned from this scenario-Merchanting remains the same, buying lots of small amounts and making a large amount will make you money. 10gp or so extra per rune etc. is an amount people are willing to pay for the convenience of getting a lot of the items they need.

 

RESULT-Merchanting has not changed!

 

 

 

 

 

Player A is a Monster Slayer, with an especial like of fighting Steel Dragons. Player B is searching for Dragon Legs. Player C is a merchant.

 

 

Scenario 2

 

Player A has been slaying Steel Dragons all day and is starting to think he will never get a profitable drop. But suddenly, he finds the fabled Dragon Platelegs on the ground! Not knowing the exact price, and wanting to get back to Dragon Slaying, posts on the GE for 1.3 mill. Player C sees these, buys them, then puts them up on the GE for 1.6 mill. Player B, who has been looking all day, sees Dragon Platelegs for 1 mill more, but being desperate for a pair buys them anyway. There. Player C just made a quick and easy 3 mill.

 

 

 

Whate we learned from this scenario-The oldest merchant principle,. buy low and sel high, still works. People who are in desperate need of things will pay higher prcies, which is how Merchants make a lot of money today.

 

RESULTS-Merchanting has not changed!

 

 

 

Player A, B, C and D are Woodcutters on there way to 99 WC. Player E is a Merchant. Player F is a Flether who wishes to fletch to 99 and make some money.

 

 

 

Scenario 3

 

 

 

Player A, B, C and D have all cut 50k Yew logs. Player A sells his for 340 gp(1.7mill), Player B sells his for 350gp(1.75mill), Player C sells his for 360gp(1.8mill) and Plaeyr D sells his for 370gp(1.85mill). Player E sees these logs and buys all 200k for 7.1 mill. He now has 200k Yew logs, which he puts on the GE for 380 ea, 7.5mill. Player E sees all these logs, and knows he could make a lot of money, so buys them. Player F just made 4 mill.

 

 

 

What we learned from this scenario-Another old merchanting trick is that stuff with high supply has low demand, and low supply leads high demand. As there was a low supply of Yew logs of Yew logs on the GE, because Player E bought so many, there was a high demand, which was from Player F.

 

RESULTS-Merhcanting has not changed!

 

 

 

Those are only a few scenarios, why not share some of yours? What are your thoughts on what Merchanting will be like after the GE? Discuss and post your own scenarios here!

 

 

 

You should have spend a bit more time getting the numbers right, it's rather confusing to read.

 

What o you mean get the numbers right?

For example in example 2 you said player c made 3m, he actually made 300k.

[hbk_hossack]

[hide=Quote Chain]

Recently, there have been lot of topics about "How the GE will destroy the Economy!", "The GE will eliminate Merchanting!" and others. I see these topics as a total farce. The GE will NOT destroy the Economy or Merchanting. It will simply change the way Merchanting is done. Here are a few scenarios-

 

 

 

Player A, B and C are your regular players. Player D is a merchant. Player E is a Mage. Player F is a Pker.

 

 

 

Scenario 1-Player A,B and C sell 350 Nats for 300 ea

 

Player D also has 350 Nats. He sees these Nats for sale and snaps them up for 315k. Player D now has 1400 Nats.

 

Player D puts up his 1400 Nats for 434k, which is 310 each.

 

Player F puts up 100 Nats he got from Pking for 300 ea.

 

Player E has is looking to train his magic. He sees the 1.4k Nats for 434k, and 100 Nats for 30k. Which Nats will he buy? The 1.4k Nats of course. He needs a lot of Nats, and the small price increase is enough to pay for the convenience of obtaining all these Nats. There. Player E has made 119k.

 

 

 

What we learned from this scenario-Merchanting remains the same, buying lots of small amounts and making a large amount will make you money. 10gp or so extra per rune etc. is an amount people are willing to pay for the convenience of getting a lot of the items they need.

 

RESULT-Merchanting has not changed!

 

 

 

 

 

Player A is a Monster Slayer, with an especial like of fighting Steel Dragons. Player B is searching for Dragon Legs. Player C is a merchant.

 

 

Scenario 2

 

Player A has been slaying Steel Dragons all day and is starting to think he will never get a profitable drop. But suddenly, he finds the fabled Dragon Platelegs on the ground! Not knowing the exact price, and wanting to get back to Dragon Slaying, posts on the GE for 1.3 mill. Player C sees these, buys them, then puts them up on the GE for 1.6 mill. Player B, who has been looking all day, sees Dragon Platelegs for 1 mill more, but being desperate for a pair buys them anyway. There. Player C just made a quick and easy 3 mill.

 

 

 

Whate we learned from this scenario-The oldest merchant principle,. buy low and sel high, still works. People who are in desperate need of things will pay higher prcies, which is how Merchants make a lot of money today.

 

RESULTS-Merchanting has not changed!

 

 

 

Player A, B, C and D are Woodcutters on there way to 99 WC. Player E is a Merchant. Player F is a Flether who wishes to fletch to 99 and make some money.

 

 

 

Scenario 3

 

 

 

Player A, B, C and D have all cut 50k Yew logs. Player A sells his for 340 gp(1.7mill), Player B sells his for 350gp(1.75mill), Player C sells his for 360gp(1.8mill) and Plaeyr D sells his for 370gp(1.85mill). Player E sees these logs and buys all 200k for 7.1 mill. He now has 200k Yew logs, which he puts on the GE for 380 ea, 7.5mill. Player E sees all these logs, and knows he could make a lot of money, so buys them. Player F just made 4 mill.

 

 

 

What we learned from this scenario-Another old merchanting trick is that stuff with high supply has low demand, and low supply leads high demand. As there was a low supply of Yew logs of Yew logs on the GE, because Player E bought so many, there was a high demand, which was from Player F.

 

RESULTS-Merhcanting has not changed!

 

 

 

Those are only a few scenarios, why not share some of yours? What are your thoughts on what Merchanting will be like after the GE? Discuss and post your own scenarios here!

 

 

 

You should have spend a bit more time getting the numbers right, it's rather confusing to read.

 

What o you mean get the numbers right?

For example in example 2 you said player c made 3m, he actually made 300k.

[/hide]

 

Oh, I'm sorry about that I'll go and fix it, I was just so used to talking in the millions :lol:

[hbk_hossack]

OK, I've fixed those numbers, now lets get back to discussing and adding more scenarios :D

[Latinoking]

http://forum.tip.it/viewtopic.php?t=716175

 

 

 

doesnt hurt if you can collapse this topic with that.

 

 

 

+1

 

 

 

Bascially everything is in that thread of Q.

[ho3f3l]

i think only thing that fails is that u thinking in small senarios

 

 

 

if i were player E in 1st scenario,

 

 

 

i would buy 100 nats for 300ea and then start alching there, waiting for more players like player A, B, C or F to put their small amounts for lower prices, since alching take time, i would alch and check GE every now and then,

 

 

 

about ur thinking small, dont forget that with GE all worlds would be connected, will be extremely hard for a merchanter (scenario 1) do that, cous there allways be more people there selling their nats. again same thing on scenario 3 for yews, can even be more dificult on yews if GE is also for f2p, cous before that f2p couldnt post on foruns to sell just read and search someone buying or go to some market world, now they can put them on GE and wait to be sold.

 

 

 

in my case, before GE (if GE works as i expect to work), i would valuate more the player selling in k's nats than the others selling in 100's. same thing for others items, but with GE the time i will waste wont be that much to buy right away from one player selling alot, instead of 10 players selling small.

[meili]

Well I think prices will go down but this won't affect players that much since although they will sell their materials at lower prices...they can also buy materials at lower prices. :)

 

 

 

Potions are just about due for a drop in price. Many herblore makers are sitting on supplies that they don't use but can't be bothered to sell as it is too much effort. The same goes for other skills, especially crafting and smithing.

 

 

 

Sometimes for clues people are desperately looking for random crafted/smithed items which nobody is selling, exchange house will make this type of trading much, much easier.

 

 

 

Clue rewards will be much easier to sell but the good ones are really quite rare so I don't think they will go down too much as they are in demand.

[Teeg]

 

Scenario 3

 

 

 

Player A, B, C and D have all cut 50k Yew logs. Player A sells his for 340 gp(1.7mill), Player B sells his for 350gp(1.75mill), Player C sells his for 360gp(1.8mill) and Plaeyr D sells his for 370gp(1.85mill). Player E sees these logs and buys all 200k for 7.1 mill. He now has 200k Yew logs, which he puts on the GE for 380 ea, 7.5mill. Player E sees all these logs, and knows he could make a lot of money, so buys them. Player F just made 400k.

 

 

 

 

 

 

What have we learned from this scenario?

 

 

 

1. 50k Yews @ 340 each yields 1.7 mill and not the 17 mill it would have when I was in school (also see 350, 360 and 370)

 

 

 

2. Player E sells 200k logs @ 380 each for 7.5 mill, when he could have made 76 mill in my day.

 

 

 

3. The author had better brush up on his maths if he wants to make any money by merching.

[qeltar]

 

Player E has is looking to train his magic. He sees the 1.4k Nats for 434k, and 100 Nats for 30k. Which Nats will he buy? The 1.4k Nats of course. He needs a lot of Nats, and the small price increase is enough to pay for the convenience of obtaining all these Nats. There. Player E has made 119k.

 

 

What you're forgetting is that there will be dozens of sellers, not just 3 or 4. If they are all selling at 300, then player D's 310 nats are going to just sit there.

 

 

 

 

Player A has been slaying Steel Dragons all day and is starting to think he will never get a profitable drop. But suddenly, he finds the fabled Dragon Platelegs on the ground! Not knowing the exact price, and wanting to get back to Dragon Slaying, posts on the GE for 1.3 mill.

 

 

Okay, so you're assuming that the guy who got the legs is stupid. :) What you're forgetting is that lack of knowledge of what items go for will be much less common than it is now, because the GE will make it easy to see the market.

 

 

 

Player A probably doesn't even have to list his legs for sale. He just looks at the listings of people looking to buy them and sells to one of those people. Your merchant will never even see them.

 

 

 

 

Player E sees these logs and buys all 200k for 7.1 mill. He now has 200k Yew logs, which he puts on the GE for 380 ea, 7.5mill.

 

 

Where they will probably sit forever, because players G, H, I, J, K, L and so forth will have lots more logs available for sale at 350 to 360 each.

 

 

 

~q

[qeltar]

Some people (I don't mean you meili) seem to view dropping prices like this is a bad thing. Why? Consider that for every seller who makes less money because a price drops, there's a buyer who gets things cheaper as well. Most of us both buy and sell things, and cheaper supplies will help out many skillers, PKers etc.

 

 

 

As long as the price drops are benefiting productive players and mostly coming out of the hands of merchants, it's all good IMO.

[mugged99]

scenario 1 -> you're not talking about a few people that will have put up their nats for 300ea, there will most likely be thousands of players that have put nats up for sale. How can a merchanter buy them all?

 

 

 

and if a player wants nats, they might choose to shop around, depending on how many nats he wants? im sure there will be players offering 10k+ nats for 300ea?