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How to Solve Inflation, But Not Really

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  • Momma_SophieMomma_Sophie
    Mabinogi Rep: 2,575
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    Member
    edited May 11, 2021
    To Pectyl:
    Pectyl wrote: »
    To Helsa:
    Helsa wrote: »
    My GOD, you're right! Money SUPPLY; it is a supply and demand situation! :)

    Right, I don't think we've ever disagreed on that. We, once again, disagree on you presenting the problem as if abundant gold is the only reason why inflation is happening. It's not. You'd be attacking a symptom and not the disease. The gold doesn't matter if the items it would be used to purchase are also made proportionately abundant. You're still faulting the currency as if it determines value when the inverse is what's actually true.

    To Pectyl:
    Before I begin, I'd like to point out that it seems like you inserted quite a lot of emotion where none needs to exist. This isn't and shouldn't be personal and my posts aren't specifically about you or anyone you know. It's about the general idea of markets and marketing and the ideas surrounding it all. I'm not here to engage with you on a scale of who's more morally superior or what's offensive to whom or who should play in what way. I'm here to talk about inflation, not your feelings about it or population. So, keep it impersonal, rational, and on topic, thanks.
    Pectyl wrote: »
    You are judging what people do ingame without any evidence, If say 20 new players decide to play an mmorpg, How would you know what they would do and or how far they would get before dropping the game? You also wouldn't know if some of these people returned to the game at a later date.
    Because I can read market activity and make a conclusion like any other human being. If you were here during the spirit revamp, this wouldn't even be a surprise. If you look at the posts constantly made by "Returning" players, this wouldn't be a surprise. If you literally just interact with the average player who's played off and on for years on end, this wouldn't be a surprise. People literally state that they came back for nostalgia and it's clear by their activity (or lack thereof) during certain times of the year. I would know if they returned at a later date or not, because they typically wear a title that literally says "The Returned."

    Now, I don't know why you personally took offense to this and I don't really care.
    What I wrote was my own outlook on the issue and none of it was gained from somewhere specific or copy pasted from anywhere else.
    All I said was that it reminded me of a typical argument.
    I never mentioned that merging the servers would reinvigorate people's interest in the game,
    No, but your conclusion mistakenly assumes this, which was my point. You're assuming certain variables will not affect your conclusion.
    On that end I believe that brand new players is the only way to keep any mmorpg alive, Just look at how afraid some people where when World Of Warcraft was losing massive amounts of subscribers each year (Until wow classic course corrected that issue to some extent)
    And again, you make the same assumption. First of all, define "alive." Because my definition and your definition will not seem to coincide.
    Are you referring to market activity (which is how I gauge it and has been proven to be accurate)?
    Are you referring to how many people are standing around at Tir/Dunbarton?
    Are you referring to how many people are active around a certain type of content (Shadow Missions, for example)?
    What's your rubric?

    Hypocrisy aside, I don't really care to discuss population outside of its relation to the market in this thread.
    Wow imagine a company straight up asking it's player base to invite people for them XD In most cases it's something the company has to do through trailers, banners and different types of advertisements, and in some rare instances it can be a feature that is hidden away somewhere and offers some semi common item as a tiny thanks for inviting a friend or family member, But I see that Nexon NA kicked it up and notch and asked the player base to save their dying game lol.
    Alright.
    Maybe instead of merging the servers and expecting veteran players to return perhaps honor the requests they been asking for in around a decade now, A server merge was inevitable and have come up in conversations long before it actually happened.
    1. It wasn't inevitable, because a decision had to be made for or against.
    2. Yes, I've stated that it's been discussed prior to occurrence.

    Where's your point, here? What does this have to do with the market? I'm growing more convinced that you're using this as an opportunity to complain about population, rather than discuss market inflation: my original prediction.
    There we go again judging people on how and why they play the game instead of simply putting a spotlight on the game itself and allowing people to easily find it and play it, There will always be the once that play for a few days and leave never to return, But your comment suggests that the case for everyone new.
    I still don't understand why this is offending you so much or why you're spreading my claims around to apply to people I'm not even thinking about nor mentioning. Are you one of them or something?

    I've been criticizing Nexon's lack of insight on advertising the game for a long while, but you're choosing to latch on to the distasteful part that seemingly applies to you. The fact is that it doesn't matter how many people are around if people don't do anything. Get offended all you like. But, until more people start grinding materials and playing through content, prices are forever going to stay inflated due to lack of supply.

    In fact, I've seen the case occur after server merge how the population died right off because nobody actually did anything. People complained about hosting party ads for minutes to hours on end, waiting for people to show up to run Phantasm or Sidhe Finnachaid and no one would come. Some people I'm training right now also complain of the exact same problems and it's caused them to consider leaving the game before, because nobody runs content with them. And because nobody runs content with them, access to materials is closed off and thus the materials rise in value as they and others resort to buying them. You don't have to address it, I don't care. Regardless if you do or don't: present, yet content-inactive players are a factor and are no different than absent players.
    That suggests everyone is speedrunning the game or already read multiple guides to go through the game before even booting it up for the first time, That simply isn't how most people play games, But all the more power to those that does I guess.
    The point was, "People don't play the game enough to farm resources, thus prices of resources inflate." Speedrunning the game is still playing the game and generates resources. Logging in, throwing cash at RMT or gacha, chatting for a bit, buying up a bunch of stuff you need, and then logging out does not generate resource. It inflates value and thus inflates prices. They're not putting anything back into the economy, except gold. That's why there's an imbalance.

    How do I know this is what's happening? Because it reflects in the market. It even happens in reality. If there are more people buying the fruit than farming the fruit, then the fruit gains value. This is common sense. Stating that people aren't playing the game on basis of pointing to price inflation isn't a far shot in the dark, dude; it's a general rule of supply and demand. And if you bring in more people who do the exact same thing (for varying reasons I really don't care about), it'll inflate the prices even more and it has done this in the past.

    I'm simply looking at a problem and pointing out the solution on basis of what caused the problem. If you don't like the solution, tough. It's reality. Resources don't just fall out of the sky; people have to generate them or they dry up and inflate.
    And that won't happen as long as we have a "small" player base that are circle jerking the market and one another in a an infinite race that wouldn't stay as strong had there been a healthy stream of new players to shake up said market.
    It's almost like you literally ignored every point I made leading up to this and you did it for the sake of emoting your offense.

    Yes, they have this level of control... because nobody runs content to farm materials and thus compete with their prices. Yes, because competition drives down prices, but people are expecting other people to do it instead of doing it themselves. And if you bring in more players (like we did in 2019) who don't run content (which they didn't), nothing will change for the better. We've already tried your idea. It doesn't work and won't work later on just by repeating it over and over in expectation of different results. Something needs to change and this time it should be focused on the current playerbase we have, such as incentive and effort-reward efficiency.

    You are assuming that my comment was a personal attack on you which it wasn't, I very, very rarely ever write anything personal against anybody on the internet as I don't enjoy nor want to be part of any drama, and I apologize for making it seem so.

    Okay, man. Whatever you say. :joy: Thanks for dropping by; let's chat again sometime.

    To Helsa:
    Helsa wrote: »
    Helsa wrote: »

    The previous statements do show proportional and inverse proportional relationships though, but not on a sufficiently fine enough scale. Mathematically speaking then the relationships are discrete rather than continuous, but follow the continuous function as far the discrete nature of the relationship will allow. In other words the graphs would be stepped rather than smooth, if you zoom in far enough. The discrete character of the graph would be due to folks perceiving supply in numerical ranges as this would flatten out sections of it.

    Have I gotten that right?

    How far does it have to go before it's sufficient, Helsa? It's not going to be 100% accurate every single time.

    As you just said in many words, the trend is what matters and the trend is what dictates market flow and public perception of value -- another point I've made plenty of times regarding how demand works. It's literally happening in the stock market if you just go and observe for one day how supply and demand affects contract and share value. The problem of inflation stems from the trend; not an absolute value.

    The outliers are irrelevant to situation; that's why we call them "outliers." In the market, they are represented simply as "Highs and Lows" and they are used to determine "Averages" which tend to follow the trend, save for a few points of deviation. The High and Lows are the jagged edges you see when analyzing economic graphs at any period in time.

    Sure, of course but it is safe to say that on a coarse enough level where the discrete portion of the relationship is insignificant that equilibrium price is directly proportional to demand and inversely proportional to supply; I'm pretty sure that's what Adam Smith said.

    Isn't that right?
    This is correct. We've already covered this. More supply drives price down; more demand drives price up. Where is this going, honey?
  • HelsaHelsa
    Mabinogi Rep: 22,195
    Posts: 5,187
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    To Helsa:
    Helsa wrote: »
    Helsa wrote: »

    The previous statements do show proportional and inverse proportional relationships though, but not on a sufficiently fine enough scale. Mathematically speaking then the relationships are discrete rather than continuous, but follow the continuous function as far the discrete nature of the relationship will allow. In other words the graphs would be stepped rather than smooth, if you zoom in far enough. The discrete character of the graph would be due to folks perceiving supply in numerical ranges as this would flatten out sections of it.

    Have I gotten that right?

    How far does it have to go before it's sufficient, Helsa? It's not going to be 100% accurate every single time.

    As you just said in many words, the trend is what matters and the trend is what dictates market flow and public perception of value -- another point I've made plenty of times regarding how demand works. It's literally happening in the stock market if you just go and observe for one day how supply and demand affects contract and share value. The problem of inflation stems from the trend; not an absolute value.

    The outliers are irrelevant to situation; that's why we call them "outliers." In the market, they are represented simply as "Highs and Lows" and they are used to determine "Averages" which tend to follow the trend, save for a few points of deviation. The High and Lows are the jagged edges you see when analyzing economic graphs at any period in time.

    Sure, of course but it is safe to say that on a coarse enough level where the discrete portion of the relationship is insignificant that equilibrium price is directly proportional to demand and inversely proportional to supply; I'm pretty sure that's what Adam Smith said.

    Isn't that right?
    This is correct. We've already covered this. More supply drives price down; more demand drives price up. Where is this going, honey?
    Thank you for your patience. I'm looking to where we agree and where we don't, to try to understand if that is actually so and why. I'm taking a bottom up approach because when folks discuss the higher end of things then details can be overlooked.

    If I may continue, given proportionality with demand and inverse proportionality with supply, with the understanding that on a fine enough scale the market is discrete in nature, would it follow then that equilibrium is a function of the ratio between supply and demand and the market trend, to use your term, that create inflation are the results of sudden disruptions of that ratio?

  • Momma_SophieMomma_Sophie
    Mabinogi Rep: 2,575
    Posts: 290
    Member
    edited May 13, 2021
    Helsa wrote: »
    To Helsa:
    Helsa wrote: »
    Helsa wrote: »

    The previous statements do show proportional and inverse proportional relationships though, but not on a sufficiently fine enough scale. Mathematically speaking then the relationships are discrete rather than continuous, but follow the continuous function as far the discrete nature of the relationship will allow. In other words the graphs would be stepped rather than smooth, if you zoom in far enough. The discrete character of the graph would be due to folks perceiving supply in numerical ranges as this would flatten out sections of it.

    Have I gotten that right?

    How far does it have to go before it's sufficient, Helsa? It's not going to be 100% accurate every single time.

    As you just said in many words, the trend is what matters and the trend is what dictates market flow and public perception of value -- another point I've made plenty of times regarding how demand works. It's literally happening in the stock market if you just go and observe for one day how supply and demand affects contract and share value. The problem of inflation stems from the trend; not an absolute value.

    The outliers are irrelevant to situation; that's why we call them "outliers." In the market, they are represented simply as "Highs and Lows" and they are used to determine "Averages" which tend to follow the trend, save for a few points of deviation. The High and Lows are the jagged edges you see when analyzing economic graphs at any period in time.

    Sure, of course but it is safe to say that on a coarse enough level where the discrete portion of the relationship is insignificant that equilibrium price is directly proportional to demand and inversely proportional to supply; I'm pretty sure that's what Adam Smith said.

    Isn't that right?
    This is correct. We've already covered this. More supply drives price down; more demand drives price up. Where is this going, honey?
    Thank you for your patience. I'm looking to where we agree and where we don't, to try to understand if that is actually so and why. I'm taking a bottom up approach because when folks discuss the higher end of things then details can be overlooked.

    If I may continue, given proportionality with demand and inverse proportionality with supply, with the understanding that on a fine enough scale the market is discrete in nature, would it follow then that equilibrium is a function of the ratio between supply and demand and the market trend, to use your term, that create inflation are the results of sudden disruptions of that ratio?

    Yes. Radical shifts in either direction will incur immediate, radical shifts in the opposite. Supply and Demand are like two-sides of a scale. 1:1 ratio would be a perfect world, but getting as close as possible is definitely optimal. If supply shifts to 1.2, then demand will become 0.8 and if demand becomes 3.6, then supply becomes 0.4 and so forth.

    But... there's a catch...
    Even if we did achieve the perfect ratio where, say, 4 apple farmers offered their services to 4 apple eaters, the variables would include (and are not limited to) time needed to produce, cost of production, dependability on the service, and average produce consumption. Simply enough, it often does come down to who sells cheapest and for highest quality at quickest pace. That means there will be competition and the "winners" of the competition will gain more monopoly upon the service until the "losers" become more efficient or less costly in their production. And yet, the "winners" are also not perfect, so the supply won't remain monopolized so long as the other competitors do not accept defeat and continue to keep the "winners" on their toes. The "winners" only win because they need "losers" by comparison, else the "winners" lose motivation to stay on top and eventually drop down to the quality level of their previous "losers." The monkey wrench in that design is that "winners/losers" are determined by the demand, not the supply.

    Basically, we all need each other, regardless of how things look.
  • HelsaHelsa
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    Indeed since markets are having goods removed from them all the time and new widgets are being produced and introduced into them all the time, you have inflow needing to match outflow in order for the same level to remain. That level though is the supply in the market.

    I'm glad you brought this up because supply is what I wanted to ask about next. If you have a market, say, with 200 widgets in it, unless it's a monopoly which would be free to set price at the critical point of the demand curve . . .

    (which is where raising the price loses more customers than the price change and lowering the price lowers the price by more than the increase in customers.)

    . . . rather than at equilibrium, then whether those widgets are supplied by 5 widget suppliers or 10 really doesn't matter in terms of what the equilibrium price is. Certainly, having more widget suppliers allows the market to reach it's equilibrium ratio quicker or, indeed, more quickly react to inflationary market trends in the equilibrium ratio, but not really on where it eventually settles. In other words, supply is the aggregate amount of widgets not the aggregate amount of widget suppliers.

    Does that sound about right?
  • Momma_SophieMomma_Sophie
    Mabinogi Rep: 2,575
    Posts: 290
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    edited May 16, 2021
    Helsa wrote: »
    Indeed since markets are having goods removed from them all the time and new widgets are being produced and introduced into them all the time, you have inflow needing to match outflow in order for the same level to remain. That level though is the supply in the market.

    I'm glad you brought this up because supply is what I wanted to ask about next. If you have a market, say, with 200 widgets in it, unless it's a monopoly which would be free to set price at the critical point of the demand curve . . .

    (which is where raising the price loses more customers than the price change and lowering the price lowers the price by more than the increase in customers.)

    . . . rather than at equilibrium, then whether those widgets are supplied by 5 widget suppliers or 10 really doesn't matter in terms of what the equilibrium price is. Certainly, having more widget suppliers allows the market to reach it's equilibrium ratio quicker or, indeed, more quickly react to inflationary market trends in the equilibrium ratio, but not really on where it eventually settles. In other words, supply is the aggregate amount of widgets not the aggregate amount of widget suppliers.

    Does that sound about right?

    100%. Yes. That accurately sums up the situation we face in either server; people have realized that flooding the Auction House with an item lets people know that there's a lot of the item floating around the economy. When people see so many of the items in one general spot, they are not inclined to purchase any of them, even if the price is in their favor. Their perception is that there is or will be competition in that market quite soon, because it's not difficult to beat 10 instances of item [x] listed @ 400k when another person simply has to list 1 instance @ 300k every so often to get a quick, consistent sale. This is much more difficult of a situation to push with items like Kraken Hearts or even Erg materials, because they're high in demand and also rarity; one never has to worry much about competition in these fields, so long as the people who can farm them mutually agree upon maintaining the illusion of scarcity while also exaggerating necessity. This is not to say that all sellers of item [x] are collaborating; some items really are just that scarce, but that natural scarcity does fuel the monopoly and items like these make great targets for these kinds of strategies.

    However...
    This would mean that outsiders to the monopoly pose a threat and must be encouraged to steer away from paths that would lead them to effectively opposing the monopoly in time. Sometimes, that includes absorption into the monopoly through various appeals including -- yet, not limited to -- immediate financial gain (as some of my own students have experienced) under false promise of long term benefit. So, the widget suppliers in your example would effectively become multiple parts of a giant widget machine collaborating in unison to maintain supply flow and influence demand for the supply. Some parts of the monopoly machine would obviously would be weaker than the others, because the core always retains the most power and influence; a machine can afford to lose an arm or leg and will liquidate or outright demolish whatever parts cease to aid the machine's overall function: widget makers who fail to maintain the illusion of competition would meet such fates and actually become opposition, but at a huge starting disadvantage of being previously controlled by the competition.
  • HelsaHelsa
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    Even though we're talking about basic stuff; I really feel like we're making some progress here!

    Continuing. Conversely then can we say the same thing about the other side of the market but substitute "demander" for "supplier" and "widgets" for "dollars chasing widgets"?
  • Momma_SophieMomma_Sophie
    Mabinogi Rep: 2,575
    Posts: 290
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    edited May 16, 2021
    Helsa wrote: »
    Even though we're talking about basic stuff; I really feel like we're making some progress here!

    Continuing. Conversely then can we say the same thing about the other side of the market but substitute "demander" for "supplier" and "widgets" for "dollars chasing widgets"?

    Sure. People can use their dollar to influence and cement a central supplier by choice. People do it in reality, where they "vote" with their dollar as to whom they trust to deliver what they want, for varying reasons. They can use their currency to influence others into supporting the same business, thus creating a sort of industrial avatar powered by multiple sources of income all collaborating together to bolster the target avatar. In this case, the productivity or efficiency of the avatar is no longer relevant as the income is no longer variable in favor of being constant. The avatar can thus do as it pleases with no worry of consequences.

    This in itself creates an inverted monopoly. An inverted monopoly can exist to where the demand can essentially force out all other potential competition by their own hand, ironically creating the marketing dilemma of willful submission to an artificially created authority not much different from what's seen in religion.
  • HelsaHelsa
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    Often we see in markets that a particular brand dominates in market share: Coca Cola, Toyota, and so on; this is what you're referring to right?

    Moving on. When when speak of "dollars chasing widgets" this is just another way of saying, what economists refer to as "Money Supply" right?
  • Momma_SophieMomma_Sophie
    Mabinogi Rep: 2,575
    Posts: 290
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    edited May 18, 2021
    Helsa wrote: »
    Often we see in markets that a particular brand dominates in market share: Coca Cola, Toyota, and so on; this is what you're referring to right?
    Yes.
    Moving on. When when speak of "dollars chasing widgets" this is just another way of saying, what economists refer to as "Money Supply" right?

    Not necessarily. The amount of dollars in circulation are not relevant to the amount that's chasing the widget production. Only the value of the dollars chasing the widgets are what matters, because they translate the value of the widgets. The amount of money supply does impact the value of the money and would cause the need for more money to chase the product, but it does not impact the value of the product. It just means you have to spend more money to get the same value.

    The actual definition of Money Supply is: "the total amount of money in circulation or in existence in a country." This has nothing to do with what's chasing the product or product value, because not all of it is going to be chasing that product. This is like thinking that if you changed the measurements of a bottle of soda to "Milliliters" instead of "liters," then we would all get more soda since the digits are bigger. No, you're getting the same amount of soda; only the metric of measurement changed.
  • HelsaHelsa
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    I see what you mean. The dollars chasing widgets are just one market while Money Supply pertains to the entire economy. So, dollars chasing widgets are a portion of it. Any changes to the money supply would take time to alter the portions in each bucket that make up the total.

    I see what your saying about the "value" of something, you're referring to thereal value of a good. This is the idea of value, despite inflation. Often news reports will talk about "price adjusted for inflation" and so on; that kind of thing. For consumers though, nominal value, price, is a concern. We've already discussed how throwing more dollars into peoples pockets will lead to an increase in prices.

    We could morph this discussion into ways of dealing with inflated in-game prices. Together, we have come up with two means of attacking the problem: increasing the supply of widgets, or reducing the number of dollars chasing widgets. The problem is it would be a moot discussion. Nexon is aware of both of these concepts. Since Nexon is a kind of monopoly they would want to set things at an optimal point. In this case there are two competing trends. The more expensive in-game items are, say, in the auction house, the more unhappy buyers are. This translates to less people playing the game. On the other hand, the more expensive in-game items are, the more likely folks will consider the web-shop as an option. Remember, as expensive as in-game items are, the whales aren't complaining. Since the whales are funding the game Nexon doesn't seem to see the current pricing situation as a problem because in their mind the only folks that exist are the ones that actually give them money
  • Momma_SophieMomma_Sophie
    Mabinogi Rep: 2,575
    Posts: 290
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    edited May 23, 2021
    Helsa wrote: »
    I see what you mean. The dollars chasing widgets are just one market while Money Supply pertains to the entire economy. So, dollars chasing widgets are a portion of it. Any changes to the money supply would take time to alter the portions in each bucket that make up the total.

    I see what your saying about the "value" of something, you're referring to thereal value of a good. This is the idea of value, despite inflation. Often news reports will talk about "price adjusted for inflation" and so on; that kind of thing. For consumers though, nominal value, price, is a concern. We've already discussed how throwing more dollars into peoples pockets will lead to an increase in prices.

    We could morph this discussion into ways of dealing with inflated in-game prices. Together, we have come up with two means of attacking the problem: increasing the supply of widgets, or reducing the number of dollars chasing widgets. The problem is it would be a moot discussion. Nexon is aware of both of these concepts. Since Nexon is a kind of monopoly they would want to set things at an optimal point. In this case there are two competing trends. The more expensive in-game items are, say, in the auction house, the more unhappy buyers are. This translates to less people playing the game. On the other hand, the more expensive in-game items are, the more likely folks will consider the web-shop as an option. Remember, as expensive as in-game items are, the whales aren't complaining. Since the whales are funding the game Nexon doesn't seem to see the current pricing situation as a problem because in their mind the only folks that exist are the ones that actually give them money

    100%. I do not disagree with anything you've said in this post, except one thing. I'll get to it.

    I do enjoy the discussion and I think Nexon/Devcat does sometimes listen to reasonably presented arguments for changes in the game design. I don't think it's a coincidence that they've suddenly started aiming towards altering chest key reward proportions. I think this discussion as well as other discussions like these have a strong effect on game direction and I'd like to see more of it! I genuinely believe that the developers sometimes do not consider all options on the table, because they sometimes don't know the options exist or how we will respond to them.

    I think us players having these discussions helps them understand what's actually going on in the community and what people think about it: actual feedback. If anything, it helps other players also understand what's going on; we can make changes on our own behalf as players of the game and move forward with new ideas that some of us have never considered.