Any plans to fix inflation in the economy? (PC/NA)

doesurmindglow

Players (and people in general) are pretty terrible at understanding the dynamics of monetary policy, and this thread is no exception.

To be clear, all of these claims are false or at least not supported by data:

• Guild traders drive inflation by encouraging trade guilds to bid more for spots. This is nonsense. The guild trader bids are a gold sink, and delete gold from existence. Their effect, if any, is deflationary. Remember: any system that deletes gold from existence is deflationary.
• Mat farmers and bots encourage inflation. I don't love either mat farmers or bots but their effect too, if they have one, is likely deflationary. The prices of materials are determined by two factors: the supply of materials and the supply of gold. Demand can move these figures around but increasing the supply of materials necessarily decreases their value in gold.
• Buying up the supply of mats increases inflation. I have no doubt this increases the value of the mat in question compared to other mats but there is no effect on the value of gold from this, either. Gold is neither produced nor deleted from these transactions. There may be some indirect effect like players more aggressively tap gold sources (ie. mob drops) to pay for the increasing mat prices, but if that is true, it's likely also that mat farming is more popular when prices are high.
• Selling crowns for gold increases inflation. Again, this transaction simply moves existing gold around, it doesn't create or destroy it, which is required to affect inflation. If there are impacts from this, it's secondary and tied to the use of gold sources.
• Trading addons cause inflation. The mechanism for this isn't remotely explained and patently ridiculous, but if there is an impact it's the same as the above -- gold is moved around due to market signals, it is not created or destroyed.

Okay so what is true? Gold inflation is created by one equation and one equation only: The sum total of gold produced from in-game gold sources -- which include NPC vendors, drops from monsters that are killed in the game world, quest rewards, and fencing -- minus the sum total of gold deleted from existence by gold sinks -- wayshrines, shrine respecs, NPC repair costs and sales, and guild trader bids. No other equations really matter except to the extent they drive one or the other end of this equation.

Let's have a look at the actual data. Most indications are that gold inflation is indeed a problem on NA, and though prices have stabilized somewhat in recent months, looking at price signals for a number of highly traded items suggests that the problem began somewhere between 700 and 650 days ago. Price elasticity varies across commodities, with consumables that have greater rarity (or, more likely, less supply elasticity) generally showing more elasticity:











The Dreugh Wax graph is a little screwy due to wild outliers but it does still suggest a similar timefreme for the start of the inflation:



It's important to note, however, not all commodities have universally gained value as expressed in gold, but I do think the changes in tempers and other "top line" highly traded commodities suggest a pattern of inflation server-wide. Obviously, some commodities have actively been adjusted by the developers, including recently jewelry materials. But for the sake of transparency, a commodity such as Lady's Smock has actually lost value over this timeframe:



Many commodities also experience seasonality, with crafting events and other in-game recurrences that affect a seasonal item demand driving sometimes quite wild swings in pricing against time. I suspect also that shifts in the meta, such as away from a certain popular spec or build, are also a factor and this likely explains deflation of certain commodities that generally go against the norm without clear touchpoints from the developers.

Taking a rough date of 675 days ago, math gives us a timeframe to start exploring patch notes for a potential cause:



This suggests the problem is likely a result of a change in the Ascending Tide patch, or the one before it, as the inflation is probably not likely to manifest until after the change hits the live server, and likely, not until some time has passed and the markets have begun to digest the change. This being said, I went back and looked at the Ascending Tide patch to see if anything stuck out as a culprit. This was a fairly modest base game update that mostly introduced Account Wide Achievement and little of economic relevance, so I suspect it wasn't the patch at issue, as there is little here that could upend the gold balance equation:



As a result, I also explored the prior major patch, which was called Deadlands or Update 32:



Assuming again that something like "new boss fight music" doesn't substantially change the gold balance equation, the most likely change at issue is probably the Armory System as it does eliminate a frequent (and therefore, mathematically, quite large) gold sink from the game by reducing or eliminating the cost of respecing characters. It's possible also that curated set drops might have been a driver, but less directly so: fewer farm runs probably do mean less decon fodder, which contracts the supply of materials, and increases their value compared to gold. But this doesn't actually eliminate a gold sink the way the Armory does so I'm less inclined to suspect it.

A vast implementation of free or lower cost respec to replace NPC shrines does seem potentially causative, and though there is the usual caveat that a correlation of the change with an observed inflation a few months later doesn't prove a causation, it seems rationally plausible and supported by these data.

What can be done? One obvious intervention that targets the change directly would be to have armory slots incur a modest gold cost to be equipped. I don't know for sure if players would accept that as a change, though, as it does seem like a progression setback, and many players have purchased armory slots and assistants with crowns, which to me seems like a valid basis for keeping the system the same in order to honor their purchases in full.

Another alternative would potentially be to raise the cost of respecs done outside the armory system, which would make up the lost gold deletion. It's harder to say if this change would be effective, though, as a likely outcome would be greater use of the armory.

A third, and probably most amenable to players, option would simply be to introduce a new gold sink that replaces roughly the gold drawdown once achieved with character respec through the shrines. There are some decent ideas on here, but one of the most obvious would be to offer another NPC vendor that sells in-game items for gold, or to raise the costs of existing NPC vendors.

A fourth option might be to "buff" the existing gold sinks by increasing guild trader commissions, wayshrine costs, bounties, and other similar high frequency gold deleting fees. I'm not sure exactly how much each of these gold deletions would have to be buffed to achieve greater price stability, but I hope that providing some of this data might give developers a relatively strong place to start: essentially, developers should look at the logs in aggregate for the amount paid to respec shrines before and after the armory change and see if there is good data there that suggests a target for a new or improved gold sink.

Sakiri

The only problem with increasing the existing sinks' costs, is that not everyone is rich. I know folks that are constantly in the 10s of thousands range. People that aren't subbed are also in this boat as well, and can't hoard things of value due to reduced storage and no craft bag. It's not really a good suggestion. it affects the super poor more. I remember when I started back up after 9 years I couldn't afford to teleport most of the time.

NoTimeToWait

doesurmindglow wrote: »

Assuming again that something like "new boss fight music" doesn't substantially change the gold balance equation, the most likely change at issue is probably the Armory System as it does eliminate a frequent (and therefore, mathematically, quite large) gold sink from the game by reducing or eliminating the cost of respecing characters. It's possible also that curated set drops might have been a driver, but less directly so: fewer farm runs probably do mean less decon fodder, which contracts the supply of materials, and increases their value compared to gold. But this doesn't actually eliminate a gold sink the way the Armory does so I'm less inclined to suspect it.

A vast implementation of free or lower cost respec to replace NPC shrines does seem potentially causative, and though there is the usual caveat that a correlation of the change with an observed inflation a few months later doesn't prove a causation, it seems rationally plausible and supported by these data.

What can be done? One obvious intervention that targets the change directly would be to have armory slots incur a modest gold cost to be equipped. I don't know for sure if players would accept that as a change, though, as it does seem like a progression setback, and many players have purchased armory slots and assistants with crowns, which to me seems like a valid basis for keeping the system the same in order to honor their purchases in full.

Another alternative would potentially be to raise the cost of respecs done outside the armory system, which would make up the lost gold deletion. It's harder to say if this change would be effective, though, as a likely outcome would be greater use of the armory.

A third, and probably most amenable to players, option would simply be to introduce a new gold sink that replaces roughly the gold drawdown once achieved with character respec through the shrines. There are some decent ideas on here, but one of the most obvious would be to offer another NPC vendor that sells in-game items for gold, or to raise the costs of existing NPC vendors.

A fourth option might be to "buff" the existing gold sinks by increasing guild trader commissions, wayshrine costs, bounties, and other similar high frequency gold deleting fees. I'm not sure exactly how much each of these gold deletions would have to be buffed to achieve greater price stability, but I hope that providing some of this data might give developers a relatively strong place to start: essentially, developers should look at the logs in aggregate for the amount paid to respec shrines before and after the armory change and see if there is good data there that suggests a target for a new or improved gold sink.

As far as my own assumptions go, the major source of gold is always players, since actual gold comes from normal ingame farming activities (quest rewards, monster gold drops etc).

So, my assumption is that ESO got a decent amount of new active players during covid. It took for them about half a year to get better at game and start spending gold not on basic stuff from in-game NPC shops, but guild traders too, so that farmed gold started to trickle into economy more. And it took around a year for this gold to accumulate and actually start influencing prices directly.

Now, there is an interesting conclusion that could be made from this. We got another influx of players last autumn due to free ESO giveaway on Epic store. Not sure how big that influx was, but looking on EU prices spike across the board and more items being on sale, I would say that quite a lot new players. So we are up for another bout of inflation in the next half a year or a year, if the thigs follow the same route as before

ShadowPaladin

I do like your analysis doesurmindglow. But as Sakiri mentioned, your solutions - especially the one with increasing the gold sinks already ingame - are not that good. As Sakiri mentioned, there is a chasm between *rich* and *poor* players. I would say that it is comparable to RL, where you have 10% who own 90% and are super rich and 90% who do only own the remaining 10% and are more or less poor.

Now, if you only want to hit the *rich* players with billions of gold, then the only way I can think of to do so would be to introduce a *wealth tax*. For example, all with more than 250mio gold on any char and in their personal bank will get 5% automatically removed - lets say - each month. This will continue until they fall under a certain threshold, for example 100mio.

This could perhaps stop players from hoarding gold, because it would be meaningless to do so, since they would loose gold if they move passt 100mio. Instead they would start to spent it or they perhaps would stop acquiring gold alltogether.

NoTimeToWait

ShadowPaladin wrote: »

I do like your analysis doesurmindglow. But as Sakiri mentioned, your solutions - especially the one with increasing the gold sinks already ingame - are not that good. As Sakiri mentioned, there is a chasm between *rich* and *poor* players. I would say that it is comparable to RL, where you have 10% who own 90% and are super rich and 90% who do only own the remaining 10% and are more or less poor.

Now, if you only want to hit the *rich* players with billions of gold, then the only way I can think of to do so would be to introduce a *wealth tax*. For example, all with more than 250mio gold on any char and in their personal bank will get 5% automatically removed - lets say - each month. This will continue until they fall under a certain threshold, for example 100mio.

This could perhaps stop players from hoarding gold, because it would be meaningless to do so, since they would loose gold if they move passt 100mio. Instead they would start to spent it or they perhaps would stop acquiring gold alltogether.

Tbh, if people actually hoarderd gold, it would partially solve the inflation problem, because the gold in a hoard is effectively taken away from economy, since it is sitting there not used.

In reality, "rich" players don't hoard gold that much (except people who have to make bids for their guilds or simply like to look at a big number in their wallet). Big traders already lose gold if they don't spend it due to inflation making gold effectively cheaper each year. There is no point in having a lot of gold in inflation-driven economy, most of it is spent on wares for resell in future or crown crates (or other crown items). So, if inflation lessened, it would be even more effective, because "rich" people would be less driven to get rid of gold as soon as possible, before it gets even cheaper, which would lessen inflation even more.

SilverBride

ShadowPaladin wrote: »

Now, if you only want to hit the *rich* players with billions of gold, then the only way I can think of to do so would be to introduce a *wealth tax*. For example, all with more than 250mio gold on any char and in their personal bank will get 5% automatically removed - lets say - each month. This will continue until they fall under a certain threshold, for example 100mio.

Why should players be punished for making gold? I pay a fee for every item I list on our trader and if I remove the listing, which I have done, I don't get this fee back. I also pay taxes to the guild on every sale I make. Why should more of my earnings be taken from me just because I am good at trading?

valenwood_vegan

Introducing a tax on "wealth" (ie: hoarded gold) would, in my mind, cause people to spend that gold on commodities in order to remain under the "cap" and avoid triggering the tax. Wouldn't that drive inflation even more?

And as SilverBride mentions above, it might be looked at as a punishment. This is a game that people play for fun. Punishing them for doing so is not a good idea. (I know, for example, that a big source of complaints in New World was the fact that housing was taxed).

I think it would be more effective to a) alter the supply or demand of high demand items (such as was done recently with jewelry mats - on PC/NA at least, that change has greatly reduced the cost of a jewelry upgrade) (an example of altering the demand-side of this would be selling tri-pots for AP or allowing them to be made with an alchemy mat other than columbine, thus reducing demand for columbine) (and I do understand that this does not directly address inflation, as it does not affect gold being created and destroyed... but it can help address symptoms of the problem, by making it cheaper for players to acquire items they actually *need*)...

and/or b) to introduce desirable items that rich players could purchase with their gold (thus removing the gold from the game without it feeling like a punishment).

kiwi_tea

SilverBride wrote: »

Why should players be punished for making gold? I pay a fee for every item I list on our trader and if I remove the listing, which I have done, I don't get this fee back. I also pay taxes to the guild on every sale I make. Why should more of my earnings be taken from me just because I am good at trading?

The issue here is not that anyone should be "punished" for making gold, it is that inflationary pressures squeeze the majority of the player base - especially new players - in ways that make accessing the economy brutally time consuming.

Either they have to grind quite insane amounts of gold just to get started. 90k each for 7 hakeijo for a new PVP build takes a big percentage of my gold each time, and I am an experienced player who earns quite a lot of gold relatively to most players out there. Farming those mats in IC is less convenient, but the fact that basics of a good PVP build continue to be such enormous grinds/expenses is part of why so few players can actually farm the mats in the first place. New players face competition with bots and very fast, very dedicated node farmers.

It's hard for new players to access the mid-game, let alone the end-game. It's very hard to build beyond purple even months and months into playing, unless you already understand all the systems and have existing connections.

The system desperately needs gold taken out from the top in some fashion so prices can come down. It's not like in a real economy where (theoretically) huge sums of gold at the top drive economic investment. All we're seeing from this explosion of wealth at the top is prices inflate out of any reasonable reach of a huge number of players we want to see the game retain.

At what point is the new-mid-player grind for gold so simultaneously punishing and unrewarding that it costs the game players?

I think we're years past the point on PCNA when many, many players must be saying to themselves "this is never going to be worth the time investment I have to make in order to access the core items I need from the market". What we have left driving things are whales who are willing to part with real money in the form of crowns in order to quickly access the market. Can't you see that the whole market is incredibly stacked in yours and my favour, but very heavily against the average player who is just struggling for starter/subsidence capital?

Sakiri

hybridization and oakensoul also happened in that update.

Everyone started wearing medium armor and using daggers/2h, and heavy chests for oakensoul builds.

Oakensoul builds being huge drove up the price for columbine because they don't use spellpower pots, they use tripots.

Also, it's not necessarily inflation. Inflation implies there's poor people and expensive things. We have expensive things, but gold rains from the sky here.

doesurmindglow

ShadowPaladin wrote: »

I do like your analysis doesurmindglow. But as Sakiri mentioned, your solutions - especially the one with increasing the gold sinks already ingame - are not that good. As Sakiri mentioned, there is a chasm between *rich* and *poor* players. I would say that it is comparable to RL, where you have 10% who own 90% and are super rich and 90% who do only own the remaining 10% and are more or less poor.

Now, if you only want to hit the *rich* players with billions of gold, then the only way I can think of to do so would be to introduce a *wealth tax*. For example, all with more than 250mio gold on any char and in their personal bank will get 5% automatically removed - lets say - each month. This will continue until they fall under a certain threshold, for example 100mio.

This could perhaps stop players from hoarding gold, because it would be meaningless to do so, since they would loose gold if they move passt 100mio. Instead they would start to spent it or they perhaps would stop acquiring gold alltogether.

I';m not opposed to this kind of solution but most of the people with the kind of gold you're talking about don't actually store it *in* gold especially not currently with the tendency for gold to lose value. They convert a lot of it to items, usually on a seasonal rotation, to hedge against inflation. It'd be difficult to combat that without also decreasing the supply of materials, which as I've pointed out, drives up their price. An obvious outcome of a "wealth tax" like you describe would clearly be to convert more gold to items to avoid the tax, which I guess could be deflationary potentially, if players respond by buying more from NPCs, but much more likely is that they'd buy more from guild traders, which would drive up prices further.

Put simply, if players are hoarding large amounts of gold and not ever spending it, the effect is deflationary: gold that does not circulate is effectively "sunk" even if not ideally so, as it does still exist and does still potentially circulate.

More importantly, are ultimately two separate issues: inequality of gold or gold equivalents among players, and price stability as a result of more gold being created than destroyed. The latter probably makes the former more painful, but a solution targeting the former probably won't do much unless it actually targets in-game gold and removes it from existence.

Again, we need to remember that moving gold around between players, or between commodities is not a solution. Only removing gold from existence is a solution.

TaSheen

I spend the free daily rewards tel var for hakeijo and the free daily rewards AP for dawn-prism. It would never occur to me to spend gold on a trader for those.

Actually.... I don't spend much on traders at all and I never sell anything. I don't ever really need much. I'm basically self-sufficient for my (VERY casual though many hours a day) gameplay.

doesurmindglow

valenwood_vegan wrote: »

Introducing a tax on "wealth" (ie: hoarded gold) would, in my mind, cause people to spend that gold on commodities in order to remain under the "cap" and avoid triggering the tax. Wouldn't that drive inflation even more?

It almost certainly would, yeah. Though even if it hit a small fraction of the gold in storage and deleted it, it could be deflationary. It's a pretty unpredictable idea and not a good solution: its impact could just as easily make the issue worse rather than better.

A better -- meaning, more predictably effective -- approach is to strengthen the existing gold sinks by increasing their cost or (my preference, as it's less painful for new players) to add more high end gold sinks, such as more NPCs like the luxury vendor.

kiwi_tea

Sakiri wrote: »

We have expensive things, but gold rains from the sky here.

I'm curious about this statement. How do you earn most of your gold? If I do writs every day, gold rains from the sky for me. But that's a boring routine that took a lot of set up, and many players don't immediately know it is a path to riches. They just earning through quests, etc. Gold does not rain from the sky until you're pretty experienced and looped in.

Longer term players have more gold than they know what to do with. That is why prices are so stupid. The problem with the market does not affect those players at all, so they will say things like "gold rains from the sky" as though it's a universal truth.

I'm betting the vast majority of players earn very, very little gold relative to us.

SilverBride

kiwi_tea wrote: »

Can't you see that the whole market is incredibly stacked in yours and my favour, but very heavily against the average player who is just struggling for starter/subsidence capital?

When I was looking to buy my first house I wanted a large one, but I couldn't come up with nearly enough gold, so I saved my ESO+ crowns for about 8 months until I had enough to get it with crowns. After I finished decorating it I wanted another, but I didn't want to wait another 8 months so I decided to try my hand at trading.

I had 100k gold when I joined my first trade guild and have done very well. Now I have 33 houses and have enough gold to continue to buy and decorate more. All because I wanted something and I figured out how to get it.

Other new players can do the same.

doesurmindglow

Sakiri wrote: »

hybridization and oakensoul also happened in that update.

Everyone started wearing medium armor and using daggers/2h, and heavy chests for oakensoul builds.

Oakensoul builds being huge drove up the price for columbine because they don't use spellpower pots, they use tripots.

Also, it's not necessarily inflation. Inflation implies there's poor people and expensive things. We have expensive things, but gold rains from the sky here.

This is why it's important to look at multiple commodities, so that we can see if the pattern is inflation -- meaning "when a means of exchange (money) loses purchasing power" or merely a shift in demand toward one commodity and away from others. My analysis does do this and though there are commodities that lost value, most dramatically increased in price.

My graphs above have examples of not just Tempering Alloy and Columbine but also Dreugh Wax, Dragon Rheum, and Platinum Ounces, all of which are largely unaffected by (and in some cases, undermined by) a shift to tripots or heavy armor. Hybridization might move demand (and therefore gold) from one commodity to another, but it will not result in across-the-board price increases as we've seen. I've looked at other examples I didn't include that have a similar pattern -- Kuta is an example, here's that graph:



It's doubtful people are using more Kuta as a result of hybridization, but it is likely that it would gain value in an inflationary scenario. Even some of those that lost value are really kind of close to even, which really shows that gold has been losing its value right alongside them. The only "pure" cases of deflationary trends I've seen in commodity pricing are those rare cases where the developers have made a significant change to the drop tables that govern them, such as the recent change to jewelry materials.

If someone else wants to go through the ESO data and try to substantiate the case that gold itself has not lost value, they're welcome to do so at UESP: https://esosales.uesp.net/viewSales.php

I think most players' experiences, anecdotal as they may be, better align with the data I've looked at but I'm open to new data and new interpretations.

valenwood_vegan

SilverBride wrote: »

I had 100k gold when I joined my first trade guild and have done very well. Now I have 33 houses and have enough gold to continue to buy and decorate more. All because I wanted something and I figured it how to get it.

Other new players can do the same.

This is actually another great point that seems to get glossed over in these discussions. Any player can farm up pretty much any item for their own use, or to sell, if they want to put in the effort. So ok inflation bad... but then we can also sell the things we find for more money. If players don't want to farm and don't want to get involved in trading, that is to some extent their problem (though as I mention above, the cost for actual necessary items can be brought under control with supply/demand adjustments).

And I do understand that *new* players are harmed the most by inflation... we do all start out with nothing. Maybe there could be some way to keep gold sinks (ie: wayshrine, repair cost, etc) low for new players but increase them for established players as their wealth increases. And to make some of the "necessary" mats or items more available to new players.

There are also adjustments that could be made to make endgame raiding / pvp into more self-sustaining activities.

But at the end of the day, this is a mmo... once you get to a certain point, you're going to have to do some grinding. I, very similarly to SilverBride, wanted to get into housing but didn't have the gold. So one day I took a chance and joined a trading guild. I'm not even spending hours farming, I'm not flipping... I just learned what items sell well at what times; and how to farm efficiently; and I've made a small fortune while still playing the game in a fun way. It's not hard to make gold if you put in a bit of effort.

It's interesting to me how some will put in a huge amount of effort to get a certain gear piece or lead to drop, but then aren't willing to do anything to improve their gold situation.

kiwi_tea

SilverBride wrote: »

kiwi_tea wrote: »

Can't you see that the whole market is incredibly stacked in yours and my favour, but very heavily against the average player who is just struggling for starter/subsidence capital?

All because I wanted something and I figured it how to get it.

Other new players can do the same.

Housing is a pretty static sink, with fixed prices. You get a house, you have it. Done. You get furniture, you have it. Done. If you're building your furniture, then your mundane runes, etc are inflating, but... It's a relatively easy market to get into because your investments don't depreciate and need replacing.

Inflation has still made it hard to get into housing. It's still a problem. I just don't see it as a most pressing one.

Where the pinch comes for newer players is mats for builds and chasing the ever-shifting meta where your hard-earned investments can constantly depreciate, and eventually if inflation continues unabated, they are going to be depreciating within the meta faster than a newer or more casual player might manage to keep up with. Add power creep to the mix, and you'll players frozen out unless they are really willing to commit to a precisely unhealthy amount of time to the game.

That's always going to be a challenge in every MMO to an extent. I don't dispute that basic point.

My point is about the *extent of the challenge as it currently exists*. I am not arguing that the inequality and grind shouldn't exist in some basic form.

Prices coming down by some anti-inflationary means would be a net positive for everyone, including us.

SilverBride

kiwi_tea wrote: »

Where the pinch comes for newer players is mats for builds and chasing the ever-shifting meta...

Not everyone chases the ever-shifting meta. I find good builds for my characters and I don't feel pressured to completely change my gear every time there is a tweak done, and I do quite fine in group content.

kiwi_tea

SilverBride wrote: »

kiwi_tea wrote: »

Where the pinch comes for newer players is mats for builds and chasing the ever-shifting meta...

Not everyone chases the ever-shifting meta. I find good builds for my characters and I don't feel pressured to completely change my gear every time there is a tweak done, and I do quite fine in group content.

So you are fine with the way things are. Fine. Great. I really don't see what you're getting at then, are you just arguing all is fine in Tamriel's PCNA economy?

Cos as it stands I don't see you really making any argument more compelling than: "I'm good, actually".

Which. Ok. Sure. I'm happy for you.

SilverBride

kiwi_tea wrote: »

SilverBride wrote: »

kiwi_tea wrote: »

Where the pinch comes for newer players is mats for builds and chasing the ever-shifting meta...

Not everyone chases the ever-shifting meta. I find good builds for my characters and I don't feel pressured to completely change my gear every time there is a tweak done, and I do quite fine in group content.

So you are fine with the way things are. Fine. Great. I really don't see what you're getting at then, are you just arguing all is fine in Tamriel's PCNA economy?

Cos as it stands I don't see you really making any argument more compelling than: "I'm good, actually".

Which. Ok. Sure. I'm happy for you.

I am arguing against the suggestion to take gold from my bank just because I have a lot of it. I didn't start this game with a lot of gold and I found a way to change that so I could afford the things I enjoy. It doesn't matter what players need gold for, if they want certain things they need to work for it. Punishing those who have done that just because others haven't isn't any kind of solution.

kiwi_tea

SilverBride wrote: »

I am arguing against the suggestion to take gold from my bank just because I have a lot of it. I didn't start this game with a lot of gold and I found a way to change that so I could afford the things I enjoy. It doesn't matter what players need gold for, if they want certain things they need to work for it. Punishing those who have done that just because others haven't isn't any kind of solution.

I'm not advocating a wealth tax. Just to be clear. I think it has merits. I would not complain if it happened. But I'm not advocating one. I vastly prefer meaningful end-game gold sinks. Buying into new systems that people want, and need, and all the better if those systems have community mechanics that feed down to newer players in some form.

Guildhalls being separate purchase to housing would be a nice addition. Building out a guildhall system based on what we already have with housing would be a nice, if temporary, gold sink. Having those halls provide buffs or benefits for membership that require an ongoing gold investment from the guild could shift them from a temporary sink, to a longer term one.

All that sort of thing strikes me as a much more fruitful pathway than a wealth tax.

Blood_again

ShadowPaladin wrote: »

Now, if you only want to hit the *rich* players with billions of gold, then the only way I can think of to do so would be to introduce a *wealth tax*. For example, all with more than 250mio gold on any char and in their personal bank will get 5% automatically removed - lets say - each month. This will continue until they fall under a certain threshold, for example 100mio.

What a nice idea!
I see how it would turn:
1. Rich would buy the most expensive types of mats to keep it in bags. More at the end of the month. Just to save gold.
2. There would be a monthly cicle of prices up and down for these mats. It is irritating as hell, but not the worst.
3. As a result the mat prices would rise dramatically because of the raised demand.

That would make the rich even richer. Also it would make the poor either suffer or grind mats.
I guess it is not the result that OP is dreaming for

doesurmindglow

SilverBride wrote: »

kiwi_tea wrote: »

Where the pinch comes for newer players is mats for builds and chasing the ever-shifting meta...

I am arguing against the suggestion to take gold from my bank just because I have a lot of it. I didn't start this game with a lot of gold and I found a way to change that so I could afford the things I enjoy. It doesn't matter what players need gold for, if they want certain things they need to work for it. Punishing those who have done that just because others haven't isn't any kind of solution.

There's a vast body of academic literature on the problems with inflation IRL but even if you ignore that entirely it's not too difficult to understand why it's a bad thing in an MMO:

First off, inflation is a wealth tax. It means you're always losing money just with passage of time, unless you're actively working all of the time to accumulate gold to keep up with the inflation. If you haven't actively doubled your gold since the inflation began about 650 days ago, you lost half of your wealth as a result. Basically if you haven't logged in for three years and had a huge amount of gold when you left, your gold still would only buy half what it did when you last traded. Gold is being effectively taken from your bank as a result of your diminishing purchasing power.

Similarly, new players are impacted because the barrier to entry is higher, and the grind steeper; and if it isn't addressed, it will continue to make the barrier to entry higher.

Gold inflation is good for no one, including you and every other player: it's bad whether you actively trade markets and keep up with metas, whether you ignore meta chasing and just sit on a large amount you accumulated, or whether you are just starting out and need to gear up for the first time.

Price stability is also just important for the relatively efficient operation of the markets, as it helps reduce the value of speculation and hoarding from the various inflation hedges.

SilverBride

doesurmindglow wrote: »

Gold inflation is good for no one, including you and every other player: it's bad whether you actively trade markets and keep up with metas, whether you ignore meta chasing and just sit on a large amount you accumulated, or whether you are just starting out and need to gear up for the first time.

I didn't cause gold inflation and I am not responsible to correct it. Taking my gold that I worked hard to accumulate and maintain so I can have things in game that I enjoy is not a solution.

Sakiri

kiwi_tea wrote: »

Sakiri wrote: »

We have expensive things, but gold rains from the sky here.

I'm curious about this statement. How do you earn most of your gold? If I do writs every day, gold rains from the sky for me. But that's a boring routine that took a lot of set up, and many players don't immediately know it is a path to riches. They just earning through quests, etc. Gold does not rain from the sky until you're pretty experienced and looped in.

Longer term players have more gold than they know what to do with. That is why prices are so stupid. The problem with the market does not affect those players at all, so they will say things like "gold rains from the sky" as though it's a universal truth.

I'm betting the vast majority of players earn very, very little gold relative to us.

I play the game.

I do writs on two. One is doing them to level her crafting slowly. Other does them for the mats.

I sell things that drop for me. Usually get a purple pattern a day(got three yesterday) from places, I get patterns from archive. I vendor stuff. I've sold crafting mats in the past but now it's mostly drops.

Trading guild came in super handy. I started back up after 9 years abouts (I quit NA in May 2015) with 3k gold. Now I have about 5m. It stays steady, and I'm comfy with it.

Sakiri

doesurmindglow wrote: »

Sakiri wrote: »

hybridization and oakensoul also happened in that update.

Everyone started wearing medium armor and using daggers/2h, and heavy chests for oakensoul builds.

Oakensoul builds being huge drove up the price for columbine because they don't use spellpower pots, they use tripots.

Also, it's not necessarily inflation. Inflation implies there's poor people and expensive things. We have expensive things, but gold rains from the sky here.

This is why it's important to look at multiple commodities, so that we can see if the pattern is inflation -- meaning "when a means of exchange (money) loses purchasing power" or merely a shift in demand toward one commodity and away from others. My analysis does do this and though there are commodities that lost value, most dramatically increased in price.

My graphs above have examples of not just Tempering Alloy and Columbine but also Dreugh Wax, Dragon Rheum, and Platinum Ounces, all of which are largely unaffected by (and in some cases, undermined by) a shift to tripots or heavy armor. Hybridization might move demand (and therefore gold) from one commodity to another, but it will not result in across-the-board price increases as we've seen. I've looked at other examples I didn't include that have a similar pattern -- Kuta is an example, here's that graph:



It's doubtful people are using more Kuta as a result of hybridization, but it is likely that it would gain value in an inflationary scenario. Even some of those that lost value are really kind of close to even, which really shows that gold has been losing its value right alongside them. The only "pure" cases of deflationary trends I've seen in commodity pricing are those rare cases where the developers have made a significant change to the drop tables that govern them, such as the recent change to jewelry materials.

If someone else wants to go through the ESO data and try to substantiate the case that gold itself has not lost value, they're welcome to do so at UESP: https://esosales.uesp.net/viewSales.php

I think most players' experiences, anecdotal as they may be, better align with the data I've looked at but I'm open to new data and new interpretations.

I think you're misunderstanding inflation. Gold has value. If it did not, we'd be trading with things that do. See D2 stone of Jordan.

Kutas were needed when everyone needed to reenchant.

The influx of gold has gone up. More raw gold than ever is being produced. It doesn't need to be removed.

What I want to know is why EU doesn't have this supposed problem.

Which I don't call a problem. I very rarely if ever buy from traders, I make pots myself with self farmed herbs.

Amottica

GW2 has a trading system for gold to gems and gems to gold. It provides a secure means to trade the store currency for gold and visa vera, something very much needed in ESO. It also provides a gold sink

NoTimeToWait wrote: »

Sakiri wrote: »

sarahthes wrote: »

Tommy_The_Gun wrote: »

Dax_Draconis wrote: »

Craft bags have unlimited storage so there is little incentive to sell any mats at all unless the current market rate is temptingly high. Players with subscriptions can hoard them indefinitely.

If one would think about it, in theory it makes scalping crafting materials to manipulate prices possible. I mean, imagine if like 10 or more people would just buy off like 90% of the entire market supply of Platinum Ounce and then sell it at much higher price. Craft bag = no limit for how many mats one account can have.

I know someone who does this periodically. He picks a specific mat and buys out the entire map.

This happens in other games.

I'm particularly thinking about World of Warcraft, where the inflation has gotten so bad that when I quit last summer, weapon enchants sold for 90,000 gold on US Area 52, and I hear they're worse now. Gold is also harder to make unless you're an AH goblin. I quit with like 2 or 3 million gold and for the first time in the history of the game, I felt POOR.

But from there, there's an idea for a gold sink. Black market auction house. Stick crown mounts on it, set a stupid high price and let people bid to oblivion. In wow there's certain items that go for gold cap.

Black market AH for select exclusive items is actually a good idea. Basically, luxury furnisher with no price ceiling. But it really needs to have exclusive items too, because crown items would be inhibited by the current crown to gold ratio.

I actually like this idea A LOT. People want to brag about being rich in-game, why not give them a unique chance to become one of a single-digit number of owners of a certain cosmetic item from Black market AH that they can show off.

The Store works like said Luxury furnisher, with a couple of items being sold over a weekend, going to the highest bidder at the end. Items change every week and rotate over the year. So the first winner gets to be a sole owner for the whole year, before the item returns, after which there would be 2 owners etc. And the item visuals don't necessarily need to be better than crown store analogues, just good enough for showing off, the exclusivity will sell the items.

I am positive these items would sell for dozens if not hundreds millions of gold (and if the AH Seller has 10 items weekly, that's billions of gold taken out of economy every week)

I have no objection though I doubt it will drive me to spend my gold. Those with banks overflowing with gold are in that situation because they are active in the game yet do not spend much beyond what they need such as potions. It is doubtful it would have much effect since they are a heavy demand for things such as alchemy and upgrade matterials.

In the end, the market, which is players, decides what the price is. Find something costing more than one wants to pay then they can easily go farm it or they can farm something else and then sell it to gain the gold for what they really want. Or they can go without.

doesurmindglow

Sakiri wrote: »

I think you're misunderstanding inflation.

Okay I know this stuff can be a challenging concept. But I actually do understand it quite well. I work in economics IRL but that's neither here nor there: "Inflation" does NOT mean "gold has no value." It DOES, however, mean this:

Sakiri wrote: »

The influx of gold has gone up. More raw gold than ever is being produced.

Inflation simply means that more gold is being produced than is removed, and as a result, it is losing its value, and prices across the board are increasing. This not only reduces the value of the gold you have accumulated, it also requires new players who have no gold to accumulate more in order to meet market prices.

Put simply, price stability is better for the economy than inflation, and if prices are increasing across the board, which I've appears to be the case based on the available data, it is a bad thing for players and the in-game economy.

Sakiri wrote: »

What I want to know is why EU doesn't have this supposed problem.

It probably does. I've only looked at NA data because this thread is about NA, but a quick glance at EU shows a similar pattern:



The markets are not connected in any way, so the price signals behave differently, but sure enough there is data from the EU server to support the observation of an inflationary curve starting about the same time as the markets in NA. So yes, inflation is also a problem on EU but it doesn't appear to be as severe as the data suggest it is on NA.

Turning to other unfounded claims:

SilverBride wrote: »

Taking my gold that I worked hard to accumulate and maintain so I can have things in game that I enjoy is not a solution.

Ok but what happens to the gold you accumulate and maintain if the price of everything on the server doubles? Well, it's taken from you at twice the rate. Inflation is the same thing as implementing a wealth tax. There is no difference between what's been occurring on the server and what the poster was proposing, in actual effect.

Put another way, I don't agree with the other poster's suggestion either, but being both a) against a wealth tax and b) fine with inflation are inherently contradictory positions: when the gold you've accumulated is losing its purchasing power, it's the same thing as the gold being taken out of your bank. You simply will have to accumulate more in order to be able to buy the same basket of goods, and the longer you abstain from doing so, the less you will be able to buy.

If you are against having gold removed from your bank arbitrarily, you also need to be against inflation. They are the same thing economically.

Amottica wrote: »

In the end, the market, which is players, decides what the price is. Find something costing more than one wants to pay then they can easily go farm it or they can farm something else and then sell it to gain the gold for what they really want.

This isn't precisely true either. While players certainly do dictate the day to day fluctuations in prices through market forces, a change in the game's monetary policy has a much stronger effect, which is why all players are paying more now for items on the NA server than they did two years ago. Only a change to less inflationary monetary policy can solve this, as players do not control the total amount of gold in circulation.

To improve price stability, a less accommodative gold supply equation should be implemented through one thing or another. I would prefer a gold sink that either has high per-transaction amounts, such as another luxury vendor NPC, personally, though I don't know if that alone would be enough to negate the impact of a much higher frequency gold sink (respecs) from being effectively removed from the game. Which is why I've taken pains to point the developers to the data that shows when this trend began, so they can more effectively explore potential solutions to offset it.

AnduinTryggva

ShadowPaladin wrote: »

I do like your analysis doesurmindglow. But as Sakiri mentioned, your solutions - especially the one with increasing the gold sinks already ingame - are not that good. As Sakiri mentioned, there is a chasm between *rich* and *poor* players. I would say that it is comparable to RL, where you have 10% who own 90% and are super rich and 90% who do only own the remaining 10% and are more or less poor.

Now, if you only want to hit the *rich* players with billions of gold, then the only way I can think of to do so would be to introduce a *wealth tax*. For example, all with more than 250mio gold on any char and in their personal bank will get 5% automatically removed - lets say - each month. This will continue until they fall under a certain threshold, for example 100mio.

This could perhaps stop players from hoarding gold, because it would be meaningless to do so, since they would loose gold if they move passt 100mio. Instead they would start to spent it or they perhaps would stop acquiring gold alltogether.

I have found again the video where you can see that this player has nearly a billion gold! This is such an insane amount of money and I am quite certain there are more like this one.

https://www.youtube.com/watch?v=UbuB6ERGvfo

Check for minute 4:33

doesurmindglow

AnduinTryggva wrote: »

Check for minute 4:33

I can't say for certain, but I'm pretty sure this player is on the PTS: He also has 6 million undaunted keys, which would require him under the old system to be running all three pledges on hard mode on 20 different characters... ... Every single day since 1887.

Given that the game launched in 2014, I don't see this as likely.