They have already ruined the economy.

Care to elaborate?

I don't mind merchants but I dislike all the price manipulation where people make clans with massive buying power to raise the price of items. Take the the regen braclet right now.

 

http://services.runescape.com/m=itemdb_rs/Regen_bracelet/viewitem.ws?obj=11133

 

It's stuff like this that bothers me.

I think it's just downright idiotic that people still join merching clans, only to find out the friends of the clan leader (and the leader himself of course) are the only ones who make money.

 

I do however still believe it's rather annoying if I have to pay 1M for flared trousers at the 15th, and only get 500k in return for selling it on the 28th, simply because of the fact that merch clans create a massive oversupply.

merchants caused global warming too i think

*inserts two cents*

 

People are misusing the word inflation.

 

Inflation is a decrease in the value of a currency whose value is based off of an outside limited resource. For example, in the United States our paper dollar bills were at one point in our history (a long time ago) were backed up by 1$ worth of gold. Inflation is when you have 1$ worth of gold and you print two paper dollar bills. Each "dollar" bill is now really only worth 50 cents.

 

So inflation in the literal sense of the word is impossible in RS because each gp is backed up by itself. In the real world example provided, rs would be like using the gold itself as currency instead of the dollar bill backed up by the gold. After that everything is a "simple" supply and demand curve (price manipulators aside).

*inserts two cents*

 

People are misusing the word inflation.

 

Inflation is a decrease in the value of a currency whose value is based off of an outside limited resource. For example, in the United States our paper dollar bills were at one point in our history (a long time ago) were backed up by 1$ worth of gold. Inflation is when you have 1$ worth of gold and you print two paper dollar bills. Each "dollar" bill is now really only worth 50 cents.

 

So inflation in the literal sense of the word is impossible in RS because each gp is backed up by itself. In the real world example provided, rs would be like using the gold itself as currency instead of the dollar bill backed up by the gold. After that everything is a "simple" supply and demand curve (price manipulators aside).

You obviously don't know what inflation is. Inflation has to do with price levels or purchasing power when comparing two points in time. Price levels have risen over the last year or so, and likewise purchasing power has fallen (they always change together and in opposite directions because they measure the same thing). Runescape has experienced inflation. 120m a year ago could get you two AGSes (about), and now you can only get one with the same amount of gp.

 

Also when the US dollar was backed by gold, the US government could not just print another dollar. They had to get another ounce of gold or whatever to stick in Fort Knox. And you can still have inflation if your real-life currency is backed by gold.

*inserts two cents*

 

People are misusing the word inflation.

 

Inflation is a decrease in the value of a currency whose value is based off of an outside limited resource. For example, in the United States our paper dollar bills were at one point in our history (a long time ago) were backed up by 1$ worth of gold. Inflation is when you have 1$ worth of gold and you print two paper dollar bills. Each "dollar" bill is now really only worth 50 cents.

 

So inflation in the literal sense of the word is impossible in RS because each gp is backed up by itself. In the real world example provided, rs would be like using the gold itself as currency instead of the dollar bill backed up by the gold. After that everything is a "simple" supply and demand curve (price manipulators aside).

You obviously don't know what inflation is. Inflation has to do with price levels or purchasing power when comparing two points in time. Price levels have risen over the last year or so, and likewise purchasing power has fallen (they always change together and in opposite directions because they measure the same thing). Runescape has experienced inflation. 120m a year ago could get you two AGSes (about), and now you can only get one with the same amount of gp.

 

Also when the US dollar was backed by gold, the US government could not just print another dollar. They had to get another ounce of gold or whatever to stick in Fort Knox. And you can still have inflation if your real-life currency is backed by gold.

 

You are both right. Higher prices or 'lower purchasing power' can also be seen as a valuedrop of money. Basically money is worth less.

The most important question is IMO: are merchanting clans the cause of (hyper)inflation? I believe they are.

The 2 most important cause of inflation are:

1) increase of the total amount of money

2) increase of demand, and/or decrease of supply

 

1) I don't think that's it the increase of money. Yes, millions and millions of GP are 'created' everyday and pumped into the economy, but it always has. Not to forget moneysinks like construction or summoning. This arguement is still debatable since nobody can really know how much money is being created everyday.

 

2) For all the people who don't think prices can be manipulated, well they can be. In fact some companies try to manipulate prices in the real world (although it's illegal).

This is were merchanting clans come in. If it's a big clan, with lots of money, then they are powerfull enough to manipulate supply and demand. I won't go into the details since everybody knows how it works.

 

Feel free to debate with me, I love this subject.

The most important question is IMO: are merchanting clans the cause of (hyper)inflation? I believe they are.

The 2 most important cause of inflation are:

1) increase of the total amount of money

2) increase of demand, and/or decrease of supply

 

1) I don't think that's it the increase of money. Yes, millions and millions of GP are 'created' everyday and pumped into the economy, but it always has. Not to forget moneysinks like construction or summoning. This arguement is still debatable since nobody can really know how much money is being created everyday.

 

2) For all the people who don't think prices can be manipulated, well they can be. In fact some companies try to manipulate prices in the real world (although it's illegal).

This is were merchanting clans come in. If it's a big clan, with lots of money, then they are powerfull enough to manipulate supply and demand. I won't go into the details since everybody knows how it works.

 

Feel free to debate with me, I love this subject.

The source of the recent (last 12 months) inflation was from the introduction of a new PvP rewards table that issued statuettes. These statuettes are converted to pure gp. There was an imbalance of money and goods, causing inflation. (Since then the price levels have risen to the point where goods and gold are balanced and the market is in relative equilibrium.)

 

Manipulation clans manipulate prices, and temporarily increase the price of an item and then drop it. In the long run there is no effect on price levels for the average 'Scaper's market basket. The only effect manipulation has on the economy is players tend to keep larger stocks of "necessities" like prayer potions, food, saradomin brews and super restores. This causes a decrease in the daily supply (the players aren't selling them), but also a decrease in the daily demand (the players aren't re-buying them later). Net effect is zero.

 

In short, although manipulative buyouts temporarily increase the price of ONE item (per clan, of course), there is no effect on the average price level. If there is an apple shortage that causes the prices of apples to double, there is little effect on the price levels overall.

Manipulation clans manipulate prices, and temporarily increase the price of an item and then drop it. In the long run there is no effect on price levels for the average 'Scaper's market basket. The only effect manipulation has on the economy is players tend to keep larger stocks of "necessities" like prayer potions, food, saradomin brews and super restores. This causes a decrease in the daily supply (the players aren't selling them), but also a decrease in the daily demand (the players aren't re-buying them later). Net effect is zero.

 

In short, although manipulative buyouts temporarily increase the price of ONE item (per clan, of course), there is no effect on the average price level. If there is an apple shortage that causes the prices of apples to double, there is little effect on the price levels overall.

 

Here's an interesting idea - Items and GP that are never spent/sold and only stored in banks might as well not exist. The only thing (with inflation) that you have to worry about are the items and GP that are traded daily.

With an event like XP weekend, there was a brief period of hyper inflation - the prices of virtually everything rose overnight. Now that the event is over, you can expect the price of everything to fall, deflation; there will be less activity on the G.E.