good work there in explaining demand and supply driven market. one thing i have a hard time is figuring out speculatuve bubbles in such markets.
Again you do not know this. It could be true, but there is nothing in this thread to support this conjecture.
People who are speculating will enter the market with any stock (of PLEX) that they have. That is true. However, it is also true that people who have no PLEX may very well buy from CCP and sell in game as the price rises and cut down on their grinding time. But that this may or may not reduce the amount of PLEX purchased from CCP. The dynamic is like this: as the price rises, speculators will put PLEX on the market to cash out their stock (of PLEX) for a profit. Thus, speculators will reduce the rise in the price and discourage some people from buying PLEX from CCP. But it is not clear that it will lower PLEX purchases from CCP given that speculators would have to send the price below its initial value.
So what? If I buy $20 worth of PLEX when the price is 2 million ISK and I buy $20 at 3 million ISKā¦Iām still buying the same amount of PLEX which IS NOT A DECREASE.
Holy crap, so you basically dismissed something without even reading it and therefore understanding it.
No! PLEX has a set price (although that is not really all that set or fixed since there are sales and there are bulk buying discountsā¦but set that aside). The value is subjective and depends on the person.
I love laphroaig single malt scotch whisky. Sadly I can only really afford the 10 year old. Do you like it Salvos? Would you pay $40 for a 750ml bottle like I am willing? The price is set/fixed/whatever.
If you would not pay $40 your value is clearly less than $40.
If you would pay $40, then your value is at least equal to the $40 probably greater.
Value is subjective. Prices are notā¦although prices are based on subjective valuations.
Yes, we canāt really tell what is going on. Are prices rising due to changes in demand, rising levels of ISK (are PLEX superior goods for example), changes in supply, etc. Note some or all of these could all be true. My beef with Salvosā position is it just canāt be reconciled with the underlying theory he is supposedly pointing too.
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To try and do a TL;DR for my post with graphs here.
Here is, in a nutshell, Salvosā story.
Price has gone up because the supply has gone downā¦and the supply has gone down because the price has gone up.
That cannot be graphed using supply and demand which Salvos claims is the basis for his narrative. In fact, the idea of the price going up, based on the first graph should automatically call into question Salvosā narrative. Supply is an increasing function of priceāthat is as price goes up, supply goes up.
Even if we switch over to the long run and simply assume that the supply side for PLEX has economies of scale and thus that the long run supply function is downward slopingā¦it does not fit Salvosā narrative. It does not fit because the only way to see a quantity decrease is with a price increaseā¦which again does not fit with Salvosā narrative.
There is no way to reconcile Salvosā narrative about the PLEX market with the underlying concepts of supply and demand.
Now if Salvosā wants to dump the concepts of supply and demandā¦
Note: I do not mean anything negative by using the words story, narrative, etc. We all tell āstoriesā on the forums. It is how we communicate.
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There is.
That would be that rate of purchase of PLEX from CCP has not increased commensurate with the increase in its value ingame, as demand has increased due to PLEX diversification. That instead demand is increasingly supplied by existing ingame PLEX stock being re-introduced to the market.
Unlike most commodities, PLEX typically gets traded back and forth on the market numerous times before being sunk. There are no doubt PLEX fragments ingame now that are derived from full PLEX bought years ago, that have exchanged hands perhaps even 10times and still havent been sunk.
I outlined at length the possible reasons people rationally would buy PLEX in my earlier post. It is rational/cheaper to buy sub/MCT/extractors with cash, than buying a PLEX with which to buy those services ingame.
That left the rational reasons for buying PLEX as either for isk ingame, or for skins/apparel/resculpt (all of which take a loss in re-sale ingame as compared to selling the PLEX you need to buy them directly instead).
As you agreed, a person with set isk goals needs now to buy less PLEX than ever before to reach that target.
There may be players that periodically buy a set amount of PLEX from their expendable income per month/year, regardless of the value of that PLEX ingame in isk. We can assume that pool of players has remained constant as long as they still have expendable income and enjoy the game. But, though PLEX ingame has increased in value, it doesnt mean their cash expendable income has increased. If anything, they are likely to buy less PLEX per month/year and save their cash for something else instead, like a 6pack to enjoy whilst playing.
As to PLEX purchases for the purposes of skins/apparel/re-sculpt, those can also be bought ingame with PLEX bought from others for isk, or off the market for isk when/if someone sells them. Its anyones guess how many people buy PLEX from CCP just to buy skins/apparel with, but I doubt that its very high or increasing. Those PLEX are sunk in the purchase of those skins/apparel, and never enter the PLEX market ingame, nor figure into the volume traded. Furthermore those are one off expenditures, as there is no use for 2 skins/apparel of the same type, and they are permanent.
The draw the graphs and post them.
Your claim that demand has increased due to diversification suggests the following graph.
Both the price and the quantity have increased. Supply has increased. Either speculators have liquidated some of their PLEX stock or people are buying more PLEX from CCP or both.
Supply has increased. We have moved along the supply curve with an increase in supply.
So what?
Okay, sure.
Really? The Aeon Khanid Skin only has 1 oder in Jita with a price of just under 1 billion. The cost in the NES is 250 PLEX. So if you wanted one of these skins would you buy it for ISK or PLEX? The Apocalypse Raata Sunset skin is going for 320 million ISK and the 110 PLEX you could buy it for is worth 367 million ISKā¦and there are only 4 being sold in Jita. The Archon Raata Sunset skin is selling for just under a billion ISK whereas the PLEX is worth only 835,500,000 ISK. These were just on the first page. You sure about that all?
These are very thin markets. Thin markets tend to be rather volatile and also not very easy to buy what you want. Suppose you live in some NS region and want those skinsā¦are you going to tell me you are going to buy it in Jita and then move it all the way to your primary system just to save a few tens of millions of ISK? And so it seems that yesā¦people are probably buying these skins with PLEX and not on the in game market becuase the in game markets are so amazingly thin.
Well at least you finally acknowledged this.
Whatā¦why assume this?
Again, why assume this?
Maybe.
And there is the third scenario as well. That the higher in game price has lead some players to buy PLEX from CCP and sell them for ISK. How many people would buy PLEX to sell for ISK at a price of 1.6 million ISK each vs. the current price of 3.342 million ISK each?
Probably most. Did you even look at any of the skin markets. They are thin. Very thin. In the freaking Forge the few I checked had literally less skins for sale than I have fingers on one hand. Literally. Oh yes, people are just snapping them up for ISK.
So what. Ironically about a year ago we had this same discussion at work. We used apples in the discussion. Suppose you are currently buying apples from the grocery. But you plant an apple tree and instead of buying them you consume them off the tree. Does that have an effect on the supply? Yes. The supply goddamned increasedā¦even though the apples never made it to the actual market in the sense of being for sale at the grocery store.
There are lots of skins and apparel items. And CCP is adding more all the time.
Seriously your theory really amounts to, āThe price of PLEX is high because the supply has not increased fast enough, and the supply has not increased fast enough because the price went up.ā You are assuming the conclusion is true. Notice the first partā¦it has the price going upā¦and the second part, which is to justify the first partā¦has the price going up. You have basically said, āThe price has gone upā¦because the price has gone up.ā Yes, that is true. It is also a tautology. From the stand point of any type of analysisā¦it is trivial and uesless.
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Its the first.
It supports that the market is being buoyed by existing stock, not new stock.
Which is as I said.
Resale of skins/apparel is inefficient in terms of cash value for PLEX.
You just confirmed my analysis.
Cheaper to buy them for isk, than PLEX bought from CCP.
I have never denied it, nor excluded it.
Because we have no reason to believe more or less are doing so.
The regular PLEX purchasers have always comprised a minority of PCU.
The fact they can now reach their isk goals with less cash paid to CCP, strongly suggests they will instead buy less PLEX and use their expendable income for something else.
Maybe, but that would result in a depreciation of isk value of PLEX ingame, which has not occurred, In anycase, even those potential new buyers would be buying less PLEX from CCP, as they need less of it to meet their isk goals, than before.
Yes, thin. It is only in rare instances that the SKIN off the market is actually sold for more value, than its isk to PLEX to dollar rate. The price of the SKINs as put forward in sell orders, is not representative of whether people buy them. Most of those SKINs will never be sold at anywhere near their PLEX value ingame.
It means those PLEX never enter the player market. They are sunk via SKIN/apparel purchase.
Doesnt matter how many there are. Only matters how many people are buying them.
In anycase, any one purchaser needs only one for their own specific need, as they are permanent per purchase. SKINs/apparel have a terrible re-sale rate on the isk market.
Yes. Because the higher the value of PLEX ingame, the less PLEX people need to buy from CCP to raise the same amount of isk ingame in re-sale.
If before I bought 3 PLEX per month from CCP to resale for x isk (which VERY few do, as its a substantial amount of cash, no matter how rich/dedicated you are), I can now instead buy only one PLEX for that same x isk re-sale value, and spend the rest of my expendable income on beer. I buy less PLEX, because I dont need the extra isk, over my monthly isk needs. Id rather spend my hard-earned IRL cash on something else.
Aside from SKIN/apparel/re-sculpt purchase for your own use, the only other rational function of buying PLEX from CCP, is for ingame translation to isk.
Sub/MCT/Extractors are all cheaper bought directly from CCP for cash, rather than purchasing PLEX from CCP to activate them. If you want a sub/MCT/Extractor, it is categorically stupid/irrational to acquire them via a cash purchase for PLEX, rather than paying cash directly to CCP for that specific service.
Bad generalization.
It might be for you, sure. It might be for many, okay. Is it for everyone? No.
Thatās 60 bucks a month. Thatās literally equal to my former, monthly, coffee consumption.
Quite glad i dropped this. Well worth the headache i had when i stopped.
PS: PLEX are too cheap for me to consider them worth dropping money into them.
PPS: i once donated an old PLEX to eve-radio i bought from CCP, which bought 24 minutes of broadcasting time for ODE TO JOY! OH FRRRRRRREEEEEUUUUUNDEEEEEEE!
ā ā ā ā yeah! 
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Butā¦ but if you dont mean what he means and thusly assumes everyone else meansā¦ omg!
The ramifications areā¦ ohā¦ nothing lol
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That there is a sell order for that amount, does not mean it will be bought for that amount. Even if some idiot buys it, its bought for isk, which does not change the amount of PLEX that was sunk for its purchase, per the cost of PLEX as bought from CCP. Its just isk going from 1 place to another.
That is not how SKINs work.
When you buy them from CCP they are allocated to your account, for use anywhere.
Where the SKINS are sold is not material to their value in PLEX.
If you can find a cheap SKIN in NS, go for it. The seller takes the loss.
If you buy it for more than its PLEX value there, well, thats your own stupidity.
We are talking about rational behavior, not idiots that make irrational decisions.
But you didnt spend it on EVE.
You spent it on coffee.
Thatās exactly my point.
Thatās irrelevant, Salvos. You said itās a significant amount even for rich or dedicated people.
Itās not. Itās, like, here go buy yourself something. Be happy. I donāt care. Just small change.
You made an inaccurate generalization. If i spend the money on coffee or plex makes no difference, itās still an expense i donāt ā ā ā ā ā ā ā care about.
Inb4 envious people claiming iām bragging.
60 bucks is a significant amount. No matter how rich or poor you are, 60bucks is worth 60bucks, and has the significance of 60 bucks.
Without that expenditure, you wouldnt have got the coffee you wanted.
The significance is you used that to buy coffee, not EVE services.
Neither CCP, or the ingame market, cares what else you spend money on.
A penny is still worth a penny, no matter how many of them you have, or spend.
You may not experience 60bucks as a significant amount per month, but what is significant, is you didnt spend 60 bucks per month on EVE.
No, itās not in general. Itās for you. Not for me.
I drop 2.4k into coins to sell them again, five minutes later, and i made a silly 10 bucks. Iāve moved 100k euro around since August. You donāt get to declare what a significant amount of money is, Salvos. Itās relative.
Damn, your boxish thinkingā¦
Thus proving that economics are not your strong suit.
60 bucks is worth 60 bucks.
Its significance is 60 bucks.
Doesnt matter how rich or poor you are, 60 bucks is still of the same significance.
For you, it bought coffee of your choice for a month. For someone else, it bought the food they needed.
All that matters here, is that you didnt spend 60bucks per month on EVE.
60 bucks per month is very significant to CCP, per client. Much more than the cost of a standard sub.
How is a penny ever worth less or more than a penny?
Please, Ms. Economist, tell me, in your strong suit, how that happens?
Two people have done this already, and one pretty exhaustively.
That you refuse to accept a thing that is entirely accepted by anyone who has ever bought and sold for profit doesnt make it untrue.
I dont have to be an economist to follow Parasol and Teckos explainations. The fact I can follow them and that they sync with my experiences as a trader irl are all the evidence I require to draw a conclusion.
You have provided little in the way of coherent talking points and nothing in the way of actual evidence.
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No, they havent, and neither have you.
When/how is a penny ever worth more or less, than a penny?
Apart from the two explainations that have already been given you theres a third;
When ones a red cent and oneās a 100th of a GBP.
You understand that PLEX costs different prices in different currencies and that the value of those currencies constantly change, dont you?