Why Flippers Ruin the Economy!
By
Adeon Hawkwood,
Posted on: 2010-10-11 24:35 in The Market and Inventions
Quote:
Alchemical Silver would still be going for 500k+ if that weren't the case. I'd like to see the case where prices consistently continued to inflate after being spiked. Enlighten me.|
Originally Posted by Nethergoat
That's pretty much the opposite of what actually happens.
|
Quote:
|
Originally Posted by Fulmens
My, that's a lot of unsupported statements, Alkirin.
In many cases, my experience suggests that you're wrong. On a petty note, "wastes a lot of time and effort" is the usual phrasing. If you actually meant "wastes a lot of time IN effort" I apologize for my high-handed tone. |
I went through all of the effort to actually state a case against what I disagreed with. At least spare me that courtesy.
Also, yeah, I distinguish between time and effort. Some things are hard to do, but don't take much time. Some things are easy to do and take forever.
Quote:
Its a religious issue, the particular religion being a strange variant of Mammonism. You might as well argue with people that plan their investments with candle stick charts or believe the Elliot Wave governs market movements.
|
Originally Posted by thehallows
Utilizes logic in the wrong topic
|
Quote:
the absence of flippers increases volatility in several ways, all of which I've explained in many previous threads over the years.|
Originally Posted by Alkirin
Alchemical Silver would still be going for 500k+ if that weren't the case. I'd like to see the case where prices consistently continued to inflate after being spiked. Enlighten me.
|
I'd suggest flipping something for a while.
it's cheap, easy and provides a helpful primer on market forces, plus its way more entertaining than a lecture from me.
=P
The Nethergoat Archive: all my memories, all my characters, all my thoughts on CoH...eventually.
My City Was Gone
Quote:
What do you mean when you use the words "supply" and "price"?|
Originally Posted by Alkirin
a.) Pinching supply does inflate the price of an item. This is seen on a regular basis. Nothing in your experiment addresses this, only your failure to spontaneously produce an opposing effect.
|
Quote:
| b.) This is somewhat dubious, as people have radically different ideas of what the 'casual player' is and who the 'majority of players' are. At best, it can be stated that prices are easily inflated to the point that they are impractical to buy. |
Quote:
| c.) If flippers stopped attacking items on the market then, yes, the prices for those items would indeed drop, then stabilize. |
Quote:
I let other people waste the effort, then just piggyback from my stores. :P|
Originally Posted by Nethergoat
the absence of flippers increases volatility in several ways, all of which I've explained in many previous threads over the years.
I'd suggest flipping something for a while. it's cheap, easy and provides a helpful primer on market forces, plus its way more entertaining than a lecture from me. =P |
Though, do me the favor and at least link to one of those 'many previous threads'. -_-; Because, honestly, I'm failing to see how this kind of activity stabilizes anything. I'll grant benefit of the doubt, though. I want to hear this.
I normally don't like to talk about trading strategies, even indirectly. However, I will pose this: try the experiment again, using Spirit Thorns still. This time, set the purchasing price to 10,000 and the listing price to 1,000. How would you expect the results to change, and why?
Quote:
I'm too lazy to do the searches, but I can explain the mechanism.|
Originally Posted by Alkirin
Though, do me the favor and at least link to one of those 'many previous threads'. -_-; Because, honestly, I'm failing to see how this kind of activity stabilizes anything. I'll grant benefit of the doubt, though. I want to hear this.
|
Basically, prices tend to stabilize when there's a regular flow of buyers and sellers, and destabilize when there isn't. Long story short, that is the Big Magic.
Actually, as someone pointed out recently, a big component is the limit on WW slots. A flipper who buys and sells stacks of ten of an item is providing a lot more supply than someone who is buying and selling individual items -- about ten times as much, per slot. And slots are the major limiting factor on the market.
Here's the thing.
For the most part, sellers don't really have much effect on prices. Yeah, in theory you can ask for a price so high that... no one buys it. You have no effect. Okay, so you set a price low enough that it's reasonable. What happens? People pay a ton more than your asking price.
I wrote a little utility to, given the amount collected and amount paid, tell me what I listed stuff for. I've been comparing sale prices to the amounts I listed things for. Typically, people are paying 20-30% more than I asked. I listed a Kismet +accuracy for 14 million; I got paid 17 million. I listed something (I forget what) for 6 million; I got paid 9 million.
That's the big factor driving prices.
Keep in mind, an actual flipper -- someone trying to make money flipping -- isn't gonna waste time listing stuff for prices way outside the best available guess of the "reasonable" range for something. Sure, you can buy brass at 500 and list it at 250k. Maybe. If you're willing to wait a few weeks. If instead you buy it at 500 and list it at 10k, you'll make a LOT more money over the course of a week, because you'll actually have transactions happening. Lots of them.
Because the next sale always goes to the lowest price, no matter how much higher or lower than the bid it is, flippers must list below everyone else to get action. If your listing price isn't the lowest, you don't get a sale.
So if you take the flipper out of the picture, the remaining items for sale are at higher prices, by definition. You might argue that, hey, the ones they bought would still be there... But that's not usually how supply and demand works. There's a lot more demand for brass at 500 than there is at 10k. Lots of people will buy brass if it's under 5k, but won't buy it if it's over 10k. What that means is that low-priced supply will dry up faster. The same 2000 bars of brass will not stay on the market as long at 500 as they would at 5k, and that means that your chances of finding low-priced stuff aren't great -- it's too likely that it already sold out. (This is why economies with government-defined fixed prices for goods tend to need rationing -- because there's not enough supply to meet the demand at the made-up price.)
The other component is that a lot of people won't bother listing something if there aren't any bids up. A flipper provides a steady supply of bids, usually at a rate above what vendors will pay for an item, which means that if you have one or two of some salvage you don't need, there's buyers -- you can list and sell immediately. If there's no buyers, listing chews up one of your WW slots, so you are better off going to a vendor. (Doesn't matter that you might think you could get more from WW -- slots are more valuable than inf!)
That tends to mean that there's a lot more supply, which is being listed in stacks of 10, which means more supply per WW slot. More supply, more stability.
A few things.
Quote:
The buyers do. They are the ones putting the money in to actually move anything. Nothing sells until they do that. The only thing that that 'utility' of yours is noting is that you're consistently listing below what the buyers are willing to pay for those particular items. No greater implications there.|
Originally Posted by seebs
I'm too lazy to do the searches, but I can explain the mechanism.
For the most part, sellers don't really have much effect on prices... |
Quote:
|
Originally Posted by seebs
So if you take the flipper out of the picture, the remaining items for sale are at higher prices, by definition. You might argue that, hey, the ones they bought would still be there... But that's not usually how supply and demand works. There's a lot more demand for brass at 500 than there is at 10k. Lots of people will buy brass if it's under 5k, but won't buy it if it's over 10k. What that means is that low-priced supply will dry up faster. The same 2000 bars of brass will not stay on the market as long at 500 as they would at 5k, and that means that your chances of finding low-priced stuff aren't great -- it's too likely that it already sold out. (This is why economies with government-defined fixed prices for goods tend to need rationing -- because there's not enough supply to meet the demand at the made-up price.) |
Through the scenarios and definitions you have set up, yes, removing flippers would arbitrarily raise prices by default. It would then go to show that the actual market doesn't work through the scenario and definition you have established. It breaks down at this point.
"Because the next sale always goes to the lowest price, no matter how much higher or lower than the bid it is, flippers must list below everyone else to get action."
This assumes that listing low is the only alternative to dealing with the obstacle of low bids, as opposed to simply buying them out to relist at the higher price. I'm actually surprised at this oversight, as you literally listed such a strategy in the preceding paragraph.
The flipper only needs to account for low-ball bids entering the market during the attack. This is easily accomplished by placing a net of buy orders to catch them.
Quote:
|
Originally Posted by seebs
The other component is that a lot of people won't bother listing something if there aren't any bids up.
|
Quote:
|
Originally Posted by seebs
A flipper provides a steady supply of bids, usually at a rate above what vendors will pay for an item, which means that if you have one or two of some salvage you don't need, there's buyers -- you can list and sell immediately. If there's no buyers, listing chews up one of your WW slots, so you are better off going to a vendor. (Doesn't matter that you might think you could get more from WW -- slots are more valuable than inf!)
That tends to mean that there's a lot more supply, which is being listed in stacks of 10, which means more supply per WW slot. More supply, more stability. |
There seems to be a discrepancy between how you describe this hypothesis on flipping, and the actual effect of that kind of manipulation on the market.
As recently as the notable attack on Alchemical Silver, there are many past and still-persisting examples of how flipping only serves to inflate prices where they otherwise would be lower.
I would like for you, or anyone for that matter, to provide an example case where any kind of flipping has lowered and stabilized prices on an item.
Don't worry, I won't hold my breath.
Alkirin: here are some unsupported statements from your post. I'm using roman numerals as you've used both letters and numbers in your posts.
I. "Pinching supply does inflate the price of an item. This is seen on a regular basis" You have no proof that what you see is actually anyone "pinching supply" - in many cases there's a natural explanation which is, at the least, not LESS likely. (Recent example: "Why are alchemical silvers high? Oh, ToTing produces XP but no common salvage." Thread is called "Fess up, who went medieval on AlSil?" )
II. "If flippers stopped attacking items on the market then, yes, the prices for those items would indeed drop, then stabilize." This has been repeatedly disproved. The first public attempt I know of is the Luck Charmers. We dropped several thousand LC's on the market and prices went crazy for several days- from 1000 inf to 100,000 inf or more, whereas previous prices had been stable in a 50-60K band for months. They eventually did stabilize, but I don't think they stabilized at a significantly lower price.
In another example, someone managed, by taking a previously unflipped product and flipping it, to create a regular price with both bids and sales- actually increasing the number of those recipes reaching the market. I thought it was Nethergoat but I can't find the thread.
III.
Quote:
What is "it" in this circumstance? You went an entire paragraph without an antecedent there and I'm not a mind reader. | Oh, it's annoying, yeah. But that's the whole of what it is at it's worst. A nuisance that passes in time. There's no real profit made off of it, it wastes alot of time in effort, and from what I can tell, it's mostly just a result of people with too much money and too much time. Or angsty people who think they're 'cool' contributing to some kind of 'anarchy'. |
Because if "it" is flipping, I've made a few billion inf. If "real profit" means "profit in actual 3-dimensional space" then, no, nobody except (one presumes) RMTers have made any real profit off their game money. If "real profit" means "significant amounts of influence" then ... yeah, people have. I bought a purple for 351 million and sold the same item, unchanged, for 600 million last week. I know, 200 million inf is not a lot in the grand scheme of things, but that was only one item, two transactions. I flipped at least a hundred Respec Recipes when I was trying to burn inf in market fees, and I only lost money on about two of those.
There could be two or three more unsupported statements in there, but I'm having some trouble trying to figure out what you're actually SAYING.
If "it" is something other than flipping: I'm sorry. I didn't know.
IV. "Lacking this most important element alone cripples any credibility - aside from the other failing points." There are an awful lot of credible reports that are not conducted according to the strict scientific method- Woodward and Bernstein didn't have a control President.
Mini-guides: Force Field Defenders, Blasters, Market Self-Defense, Frankenslotting.
So you think you're a hero, huh.
@Boltcutter in game.
Quote:
Not really, unless you have evidence to show that this isn't what would actually happen.|
Originally Posted by Alkirin
The part in bold actually made me chuckle. In this case, there is a disconnect.
Through the scenarios and definitions you have set up, yes, removing flippers would arbitrarily raise prices by default. It would then go to show that the actual market doesn't work through the scenario and definition you have established. It breaks down at this point. |
Certainly, in all the cases where we've seen it tried, the actual outcome is exactly what the theory predicts. Prices stabilize, and tend to go lower.
Quote:
|
"Because the next sale always goes to the lowest price, no matter how much higher or lower than the bid it is, flippers must list below everyone else to get action." This assumes that listing low is the only alternative to dealing with the obstacle of low bids, as opposed to simply buying them out to relist at the higher price. I'm actually surprised at this oversight, as you literally listed such a strategy in the preceding paragraph. |
If you buy out absolutely everything at all below your listing price, you lose money if anyone sells things close to your listing price, due to WW fees.
If you don't, then sales will tend to go to people who decide to sell for 5% under the market price in the hopes of getting a quicker sale.
Quote:
| The flipper only needs to account for low-ball bids entering the market during the attack. This is easily accomplished by placing a net of buy orders to catch them. |
Quote:
| This doesn't account for alot of common salvage listed with few to no bids. In the case of common salvage, not everyone lists toward the sole end of making profit - as opposed to just a better alternative to vendoring. |
Quote:
| The flipper only provides 'stability' in the artificial, semi-closed environment erected during an attack. |
Quote:
| That is, 'stability' at the inflated price that they are forcing. |
Quote:
| There seems to be a discrepancy between how you describe this hypothesis on flipping, and the actual effect of that kind of manipulation on the market. |
Quote:
| As recently as the notable attack on Alchemical Silver, there are many past and still-persisting examples of how flipping only serves to inflate prices where they otherwise would be lower. |
Alchemical Silver tends to be a little volatile because it's extremely useful (required for many high-value recipes).
Quote:
| I would like for you, or anyone for that matter, to provide an example case where any kind of flipping has lowered and stabilized prices on an item. |
Part of this is simple, basic, mathematics: Every purchase through WW reduces the amount of inf in the market. If you reduce the amount of inf, you necessarily lower prices in the long run.
Alkirin strikes me as one of those people who should try flipping a few items him or herself in order to see how it really works.
I've never successfully made any money by attempting to manipulate or drive up the price of an item, and I have tried to do it a few times as an experiment.
I have, however, made a ton of money by buying at slightly above the bottom price for an item and listing at slightly below the top price. This is so easy to do that there's no reason to try to manipulate prices except as an experiment.
You seem to have reposted while I was writing.
It seems you're speaking of "flipping" as something that only happens during short-term "Attacks". I guess that is what the "it" refers to in your post.
This is not true. I've flipped [as I said] at least a hundred respec recipes. Over weeks. If I buy them at 65 million and list them at 81 million, and they sell at 90 or 100 million, THAT'S A FLIP. If I do this with 2-3 a day for a couple weeks, THAT'S A FLIP. If I am not the lowest seller , my recipe doesn't sell. If I'm not the highest bidder, I can't buy.
And I'm not the only person who deals in respec recipes. I'm sorry if I'm belaboring the obvious here, but you don't get it so I have to. So every respec I buy, one or two a day, I have to outbid the other guys. At some point someone gets sick of me and raises their prices. I bid "64,100,908" and they go "64,100,909." I go "64,200,908" because "908" is how I keep track of what I bought. They get annoyed and go to 66,666,666 . I now have to go to 66,700,908.
Every instaseller is now making about 2,700,908 (minus 10%) more than they were before I got involved.
On the instabuy front: People are normally paying 100 million. So I throw mine up at 81,000,908 and sell for 100 million anyway. Until someone tries 90 million and then I make less, and then EVERYONE tries 90 million and ALL the flippers make less. And then the guys I'm fighting with on the "sell it nao" front gets annoyed at his inability to sell his stuff (cause I'm selling for 81 and he's selling for 88 or something) so he cuts his prices to 79,000,000. And then someone tries 80 million, then EVERYONE tries 80 million.
Prices, if you'll notice, are stabilizing and lowering at this point. I'm speaking from personal experience here. Some of these prices are from last week.
Now I have to decide: If I sell for 80 million, I keep 72 million. I'm buying for 66,700,908 . Is that worth doing for 5 million influence? Really? I can make 10.5 million influence on a freaking Impervious Skin triple and it only costs me 3.5 million total. I bail out and the other guys, eventually, lower their buys and raise their sells.
I've seen prices driven down by healthy competition all over the place. I just have to look at the stuff I haven't relisted yet. Numina's: Heal/Rech. Celerity: Stealth. Impervium Armor: Resistance. I'm waiting for Reactive Armor to crater but apparently there's something shiny about it that I just don't see.
I have done this stuff. I have seen these results over time. I believe this is how it works.
You have not done this stuff. You have not seen these results over time. You believe it works differently.
P.S. I tried to artificially raise the price on respec recipes once. I lost my shirt and some skin.
Mini-guides: Force Field Defenders, Blasters, Market Self-Defense, Frankenslotting.
So you think you're a hero, huh.
@Boltcutter in game.
Quote:
Uhm...I've seen and personally participated in attacks on items, done specifically to do exactly this. Hell, others who have posted in this thread are also guilty of this. Secondly, your reply does not address the statement.|
Originally Posted by Fulmens
You have no proof that what you see is actually anyone "pinching supply" - in many cases there's a natural explanation which is, at the least, not LESS likely. (Recent example: "Why are alchemical silvers high? Oh, ToTing produces XP but no common salvage." Thread is called "Fess up, who went medieval on AlSil?" )
|
Now, bear in mind the discrepancy between what I said, and the things you are drawing out of my statement.
What I said: "Pinching supply does inflate the price of an item."
What I did not say: "Supply only falls short when some is attacking it.", or "There are never natural explanations behind the supply of any item falling short."
This...Seems to be a persistent problem throughout the whole of your response.
Quote:
|
Originally Posted by Fulmens
II. "If flippers stopped attacking items on the market then, yes, the prices for those items would indeed drop, then stabilize." This has been repeatedly disproved. The first public attempt I know of is the Luck Charmers. We dropped several thousand LC's on the market and prices went crazy for several days- from 1000 inf to 100,000 inf or more, whereas previous prices had been stable in a 50-60K band for months. They eventually did stabilize, but I don't think they stabilized at a significantly lower price.
|
What is "it" in this circumstance? You went an entire paragraph without an antecedent there and I'm not a mind reader.
Quote:
|
Originally Posted by Fulmens
Because if "it" is flipping, I've made a few billion inf. If "real profit" means "profit in actual 3-dimensional space" then, no, nobody except (one presumes) RMTers have made any real profit off their game money. If "real profit" means "significant amounts of influence" then ... yeah, people have. I bought a purple for 351 million and sold the same item, unchanged, for 600 million last week. I know, 200 million inf is not a lot in the grand scheme of things, but that was only one item, two transactions. I flipped at least a hundred Respec Recipes when I was trying to burn inf in market fees, and I only lost money on about two of those.
|
Quote:
|
Originally Posted by Fulmens
IV. "Lacking this most important element alone cripples any credibility - aside from the other failing points." There are an awful lot of credible reports that are not conducted according to the strict scientific method- Woodward and Bernstein didn't have a control President.
|
Try that again.
Quote:
There certainly is a disconnect. Now you're describing 'cornering the market' and it does not work except on a very short-term basis.|
Originally Posted by Alkirin
The part in bold actually made me chuckle. In this case, there is a disconnect.
Through the scenarios and definitions you have set up, yes, removing flippers would arbitrarily raise prices by default. It would then go to show that the actual market doesn't work through the scenario and definition you have established. It breaks down at this point. "Because the next sale always goes to the lowest price, no matter how much higher or lower than the bid it is, flippers must list below everyone else to get action." This assumes that listing low is the only alternative to dealing with the obstacle of low bids, as opposed to simply buying them out to relist at the higher price. I'm actually surprised at this oversight, as you literally listed such a strategy in the preceding paragraph. |
Quote:
| The flipper only needs to account for low-ball bids entering the market during the attack. This is easily accomplished by placing a net of buy orders to catch them. |
P.S. The kind of "attacks" you're talking about do indeed occur. But that's not flipping.
Paragon City Search And Rescue
The Mentor Project
Quote:
also my impression.|
Originally Posted by Camper
Alkirin strikes me as one of those people who should try flipping a few items him or herself in order to see how it really works.
|
None of the backward misconceptions people have about flipping would survive an hour in the trading pit. =P
The Nethergoat Archive: all my memories, all my characters, all my thoughts on CoH...eventually.
My City Was Gone
Quote:
Well, this isn't particularly difficult. Not artificially inflating prices removes an element responsible for the inflation of prices.|
Originally Posted by seebs
Not really, unless you have evidence to show that this isn't what would actually happen.
Certainly, in all the cases where we've seen it tried, the actual outcome is exactly what the theory predicts. Prices stabilize, and tend to go lower. |
More than one salvage item rests comfortably at high supply and low turnaround in the absence of manipulation (what used to be computer viruses, regenerating flesh, etc). That shouldn't exist by your definition unless there is someone actively working to keep supply high and listed prices low.
Seeing as you're supporting the claim of the OP, you can't accept that either.
QED.
Quote:
|
Originally Posted by seebs
For common salvage, it effectively is -- there's too much new salvage coming in for that to be a practical strategy.
If you buy out absolutely everything at all below your listing price, you lose money if anyone sells things close to your listing price, due to WW fees. If you don't, then sales will tend to go to people who decide to sell for 5% under the market price in the hopes of getting a quicker sale. |
That is...Unless you have a viable alternative explanation for the variety of cases that don't fit your rules?
Quote:
|
Originally Posted by seebs
See above. And remember, the "net of buy orders" runs into the other half of the "lowest price sells" maxim: Highest bid buys. If you have any bids at 50k, they will ALL fill before any bids at 25k do. Meaning, if you actually want to cover "snipers", your bids all have to be at close to 85%-90% of your listing price -- meaning that you're paying 85%-90% of your listing price to people who were listing at 1 inf.
|
Quote:
|
Originally Posted by seebs
Lots of people who aren't using the market actively will just list small bits of stuff, but statistically, they're a smaller effect on the market. Unless they're listing full stacks of 10, they're not going to have the same effect per slot they use that marketers who buy and sell in full stacks do.
|
If you're saying that every non-marketeer that participates in the market is negligible because they aren't operating at high efficiency, then that is a dubious claim.
Quote:
|
Originally Posted by seebs
This is simply not true. It's not true in the game, and it's not true in real life. Read about "market makers" in the stock exchanges. That's a fancy word for "flippers", and they're regarded as one of the major tools exchanges have to keep prices comparatively stable.
|
'It doesn't work like that in real life' is a baseless argument. This isn't the real life economy. I'm sure you sound 'cool' spouting off everything you learned in 101, but sorry to break it to you. This is not the real world economy, despite specific parallels. That is a grand composition fallacy.
It's...Very surprising that this needs to be stated.
Quote:
|
Originally Posted by seebs
Again, they're not forcing an inflated price to begin with. There is no inflated price that they are forcing.
No, there seems to be a discrepancy between what you declare is happening without a shred of evidence, and what actually happens in every market ever studied over the past couple thousand years of written history. |
Quote:
|
Originally Posted by seebs
It's not "flipping" to buy a whole bunch of stuff and then not sell it.
|
Toward that end, I should declare some terms here.
You guys seem to speak of 'flipping' with regard to a measure of responsibility taken for what you are doing, or an otherwise seemingly benign motive.
When I speak of 'attacking', I refer to a malicious attempt to manipulate prices for it's own sake. Where profit over the long run is irrelevant so long as you tag those few 'must have now' buyers that will pay something obscene.
Quote:
|
Originally Posted by seebs
NASDAQ. Pretty much every stock exchange ever. Commodities markets -- all of them. The WoW auction house, where you can actually track the effects much more easily. CoH's auction market. Consider Nethergoat's experiment on ancient bones, back when redside was a separate market. Prices were very volatile and tended towards being awfully high. Bring in a flipper for a week or two, and prices stabilized with a lower average.
|
Quote:
|
Originally Posted by seebs
Part of this is simple, basic, mathematics: Every purchase through WW reduces the amount of inf in the market. If you reduce the amount of inf, you necessarily lower prices in the long run.
|
Quote:
What Seebs said.|
Originally Posted by seebs
I'm too lazy to do the searches, but I can explain the mechanism.
Basically, prices tend to stabilize when there's a regular flow of buyers and sellers, and destabilize when there isn't. Long story short, that is the Big Magic.<snip> |
Absent flippers supply jumps all over the place and so do prices.
With flippers adjusting the price floors and ceilings supply and price are much more consistent and reliable.
A day of fiddling will demonstrate this reality far better than any forum post, even one as illuminating as Seebs' effort.
/edit
scanning some posts here I'm starting to suspect our new wonder poster is Another Fan in drag. =P
The Nethergoat Archive: all my memories, all my characters, all my thoughts on CoH...eventually.
My City Was Gone
Quote:
Wait, who are "you guys"? And "benign"?|
Originally Posted by Alkirin
Toward that end, I should declare some terms here.
You guys seem to speak of 'flipping' with regard to a measure of responsibility taken for what you are doing, or an otherwise seemingly benign motive. When I speak of 'attacking', I refer to a malicious attempt to manipulate prices for it's own sake. Where profit over the long run is irrelevant so long as you tag those few 'must have now' buyers that will pay something obscene. |
"—Synonyms
1. good, kindly, benignant, benevolent, tender, humane, gentle, compassionate."
I make no claims that my activity is beneficial in any way. NOR is it any sort of attack. My goal is to get inf. No more, no less. There is no altruistic, nor malicious intent on my part.
Paragon City Search And Rescue
The Mentor Project
I have to concur with the others (ie. Fulmens, Ironblade, etc.)
Alkirin, you are mish-mashing fundamental terms here, so let's toss out
some definitions...
Cornering: is the attempt to purchase, and control, the supply of a
particular niche and thereby dictate (typically with intent to raise) pricing.
Flipping: is the act of buying items at one price and then, re-selling them
at a higher price.
Cornering, is by necessity a short-term gamble. Why? Simple: you have
limited storage, limited funds, and minimal control over other players. If I
try to corner a niche, I'd buy as much of it as I can, sell a few (to myself)
to paint the tape and set a price floor, set protective bids to maintain
supply control, and then sell for profit at my newly established pricing...
It's a boatload of effort to manage, and is easily broken - how? Cheap Sellers.
People who see a high price and dump their "stock" will kill the cornerer.
Every Time.
So, while getting in is fairly straightforward, getting out in time is harder,
and overextending control duration is usually a guarantee to lose your shirt.
On the other hand, Flipping has one criterion which dictates it's viability
and duration -- price spread. It's not a gamble at all.
As long as the ability to buy above the current floor and sell below the
current ceiling produces a profit (after fees), flipping is viable (possibly for
years as some of us have done).
No cornering attempt has ever done that profitably over that kind of timeframe.
The thing you fail to grasp consistently is the earlier statement: buy above
floor, sell below ceiling... Clearly, that cannot raise pricing - instead, it
narrows the price range -- ie. it stabilizes price.
The ultimate endpoint would be a fixed amount. If widgets were always
1000 inf, no matter what, they could not, in fact, be profitably flipped.
End of Story.
So, the only way to kill a flipper is: buy above his bid price and sell below
his list price... How does it kill him? It further squeezes the price range
towards that fixed price endpoint - eliminating profit.
You could still potentially try to corner that niche (it would still be possible,
but meaningless if the price is, in fact, fixed), but you couldn't flip it profitably.
Now, I'll agree that cornering could be construed as an "attack" on a niche,
but flipping is only considered an attack by the superstitious and or
ignorant (ie. lacking in knowledgeable understanding).
Regards,
4
I've been rich, and I've been poor. Rich is definitely better.
Light is faster than sound - that's why some people look smart until they speak.
For every seller who leaves the market dirty stinkin' rich,
there's a buyer who leaves the market dirty stinkin' IOed. - Obitus.
Quote:
Actually, this helps. Greatly.|
Originally Posted by FourSpeed
I have to concur with the others (ie. Fulmens, Ironblade, etc.)
Alkirin, you are mish-mashing fundamental terms here, so let's toss out some definitions... Cornering: is the attempt to purchase, and control, the supply of a particular niche and thereby dictate (typically with intent to raise) pricing. Flipping: is the act of buying items at one price and then, re-selling them at a higher price. |
Though...We seem to be diverging from a point here, which is why I've wanted this noted.
The distinction between cornering and flipping isn't one that I alone am guilty of skimming over (see: OP and following posts).
This is what I meant to clarify in my prior post with respect to the effect on the market.
While I appreciate the pages-long diatribes concerning how cornering is only short-term gain, I don't see how any of it is relevant to the effect that cornering has on prices on the market. Not every wake ends within an hour or overnight - hell, some don't even settle down after a week.
Quote:
Very true - it's a very frequent and common misconception.|
Originally Posted by Alkirin
The distinction between cornering and flipping isn't one that I alone am guilty of skimming over (see: OP and following posts).
|
Quote:
|
Originally Posted by Alkirin
While I appreciate the pages-long diatribes concerning how cornering is only short-term gain, I don't see how any of it is relevant to the effect
that cornering has on prices on the market. Not every wake ends within an hour or overnight - hell, some don't even settle down after a week. |
are not, in actual fact, occurring. Flipping *cannot* raise pricing by itself
as I've (hopefully) clarified.
Cornering can indeed change pricing radically - but briefly, and typically unprofitably.
The problem (from my perspective) is that most of the folks struggling with
the earlier misconception attribute far too much of pricing volatility they
see to malicious marketeering activity - and quite frankly, they're wrong.
We Marketeers are just as lazy and time conscious as most - if there's
easy ways to profit, why do more "work" than needed to do it?
Simple answer: We don't...
It's easy to see that simple flipping is far easier, and much safer than cornering.
To be sure, cornering does occur, but far more often, game effects (issue
releases, events, typical play patterns) are much bigger drivers of volatility and pricing.
Further, it's relevant, because the OP's post had nothing to do with
cornering, and any price altering effects. In fact, he clearly states that
there was indeed no noticeable or appreciable change in pricing at all
resulting from his experiment...
Regards,
4
I've been rich, and I've been poor. Rich is definitely better.
Light is faster than sound - that's why some people look smart until they speak.
For every seller who leaves the market dirty stinkin' rich,
there's a buyer who leaves the market dirty stinkin' IOed. - Obitus.
Quote:
That is what I was trying to clarify with my earlier post. Except, I called cornering 'attacking' the market. Particularly because of how aggressive it was.|
Originally Posted by FourSpeed
Well, it's relevant (imho) because you're attributing effects to flipping that
are not, in actual fact, occurring. Flipping *cannot* raise pricing by itself as I've (hopefully) clarified. Cornering can indeed change pricing radically - but briefly, and typically unprofitably. |
Quote:
|
Originally Posted by FourSpeed
The problem (from my perspective) is that most of the folks struggling with
the earlier misconception attribute far too much of pricing volatility they see to malicious marketeering activity - and quite frankly, they're wrong. It's easy to see that simple flipping is far easier, and much safer than cornering. To be sure, cornering does occur, but far more often, game effects (issue releases, events, typical play patterns) are much bigger drivers of volatility and pricing. |
Granted, there's an understandable reluctance to attribute such causes in a grandiose, conspiracy-theory web of explanation. But that's not quite the case here.
It's easy to look at what happened with Alchemical Silver and Ceramic Plate and say 'oh, that's just because of ToTing' or 'that's just because people use Alchemical Silver alot'. Don't get me wrong, those two factors are at play, surely. But that alone didn't drain the supply of specific common salvage to drive prices into the multi-millions for a short time. Contrary to some claims, the wake isn't always a 30 second window that sees prices dropping to the levels they were at - or even lower (exaggeration, but still).
If it looks like a duck, quacks like a duck, and shares the same genome as a duck...
Quote:
|
Originally Posted by FourSpeed
Further, it's relevant, because the OP's post had nothing to do with
cornering, and any price altering effects. In fact, he clearly states that there was indeed no noticeable or appreciable change in pricing at all resulting from his experiment... Regards, 4 |
Quote:
I feel like I'm watching a bunch of people talking about Italian food, while one person complains that all the spices and ghee gives them indigestion.
|
Originally Posted by Nethergoat
scanning some posts here I'm starting to suspect our new wonder poster is Another Fan in drag. =P
|
Arc#314490: Zombie Ninja Pirates!
Defiant @Grouchybeast
Death is part of my attack chain.
Quote:
Dunno about the AlSil's but it looks like the CAP's was just done for lulz. |
Originally Posted by Alkirin
It's easy to look at what happened with Alchemical Silver and Ceramic Plate and say 'oh, that's just because of ToTing' or 'that's just because people use Alchemical Silver alot'. Don't get me wrong, those two factors are at play, surely. But that alone didn't drain the supply of specific common salvage to drive prices into the multi-millions for a short time. Contrary to some claims, the wake isn't always a 30 second window that sees prices dropping to the levels they were at - or even lower (exaggeration, but still).
If it looks like a duck, quacks like a duck, and shares the same genome as a duck... |
http://boards.cityofheroes.com/showp...7&postcount=10
Which makes this whole thread just that much more awesome.
@Quasadu
"We must prepare for DOOM and hope for FREEM." - SirFrederick
i accidently deleted 4500 computer viruses today. somneone help me restock,