The effect of server rares on economy

[dwhite87]

Hi, as a new player who has previously played Defiance (worst economy ever), I have to say I am soooo thankful to see this shard's economy to be so stable.
I mean 50k here is quite a healthy sum, and that is just so cool because it reminds me of the way T2A was.

My concern though, and maybe this concern is premature, is that these new server rares will have a negative impact on the economy. I mean I'm not an economy major or anything, I've just got a bad feeling about this. What do you guys think?

[Faust]

I will offer my personal opinion on the matter. It is quite similar to previous comments that I've made in regard to the economy. The server rares in my opinion won't destroy or even harm the economy. The reason behind this is because the transaction of gold from one source to the other is gold that already exists in the economy. Now if this was gold that was generated from a void such as received donations get you 1 million gold or a duping bug that produces enormous amounts too that would be a whole different situation. The only possible harm that it could cause is people wanting to go out and farm extra harder to get the gold for these items. This may hurt the economy slightly in this situation, but it also helps in another areas such as more people going to dungeons for more PVM and PVP interactions. However, regardless of the matter I don't see it hurting the economy at all. The only thing that truly hurts an economy is gold being generated in mass out of a worm hole.

[Maleficia]

Seconds Faust. While rares aren't a gold sink, they do little to add to the economy in any other way than to create P2P interaction. Fausts example of more hunting to generate more gold would be little different than someone wanting a house (only a house takes gold out of the economy if the deed is bought from a vendor). To me rares are of little value, only because I am not an avid rare collector.

[Slimeball Jasper]

The economy here/player trading was quite scarse beforehand.
It would have been nice if there was more notice given other than a forum post, etc, including ingame comments prior to the rares being implemented to make sure everyone was on to get something, instead of just 20 people owning all of the rares in the game.

However! Due to the fact that you cant buy items/money with RL money via the website, the economy here is absolutely fucking fantastic and I love it.
The main reason every other shards economy has went to shit (Ie people on Hybrid with 400-500 million gold and most items costing 100+ million) is due to the fact that you can purchase gold/items for real life money.
I'm glad we arent involved with the same practices.

[Slade]

You cannot buy regs/housing with rare items.

/thread

[BlackFoot]

not from npcs, but from players yes

[Slade]

not from npcs, but from players yes

Blackfoot, please stop proving to us how unintelligent you are.

The primary gold-sinks (economy control) in UO are housing and regs. Since rares are neither housing, regs, or the resources required to purchase them from the magical bottomless reg/housing pool, this will have little (if ANY) effect on the in-game economy.

Player/Player transactions do not break the economy. Only extraordinary Player/Server transactions do, because they introduce resources into the system that would not have otherwise existed. Since rares are not resources of any kind, they do not break the system.

Truthfully, it would be more damaging if they had spawned 2000 platemail chests around the world because those could be sold back to vendors for tens of thousands of gold that did not enter the world through proper channels.

Everyone on this economy issue expresses a gross misunderstanding of a very basic UO economic principle.

[Mens Rea]

The Xmas rare blowout only provided a small group of people with tens of millions of gold worth of rares.

Give it a week or two and we'll start to see mass inflation.

[Maleficia]

I think you are correct if the rares begin to become part of the currency. That is a big if though. It is hard to see that the rares become wildly popular and people stop trading high gold items (ie houses) unless a stack of rares are involved.

[Slade]

The Xmas rare blowout only provided a small group of people with tens of millions of gold worth of rares.

Give it a week or two and we'll start to see mass inflation.

Excuse me, but exactly who do you think decides what those rares are worth?

[Teknix]

The people buying these items will determine the price.

[mrbojangles]

If anyone knows about the spending multiplier this is a great example. Basically, here's the scenario.
Player A has a rare worth 100k, which he sells to Player B (basically creating 100k for him). Player B loses 100k in gold, but keeps an item that has a value of 100k that will never be used, worn out, etc. If player B were to sell the rares he would receive his 100k back and player C would now own the rare. Through these transfers in ownership, a 100k item has created more than it's value in spendable income for the involved parties. This new gold is not inflationary gold because it was not created out of thin air, instead it helps our economy by being invested in various forms (by invest i mean it is spent on items.) Also rares definately increase in value overtime, so it is most likely that Player
B would see a profit when he sells his item, creating even more spendable income for reinvestment.

Nonetheless, the minority of players who own the majority of rares will become very rich.

Where the money is 'invested' is the biggest determinent of how the rares effect our economy.

A) They spend their newly acquired wealth on an expensive home, thus reducing the amount of money supply in the shard, causing deflation. (But at the same time, houses are actually a horrible gold sink, since they create an item that is worth exactly what one paid for it, so if the castle is ever sold, no money is really removed from the economy.)

B) They buy rares that they want, creating basically a closed circuit of money flow.

C) They spend the money on items from other players, like magic weapons, armor, or whatever. This most often gives money back to less wealthy players, but will basically create a complete circuit as well. Money is redistributed, nothing is added, end of scenario.

D) Regs, arrows, pouches, guildstones, etc are the real gold sinks, items that are used up and not re-sold between players. These remove money from the economy and cause deflation.

[BravoFoxtrot]

I like to mention this, not all rares that are bought or collected are resold. Players like myself, who collect rares, usually don't resell.
I will buy a rare with no intention of reselling, I am a collector. So if I buy a rare, I am in fact taking one out of circulation, decreasing the amount on the market.

This can sometimes drive the value of a rare up, but it doesn't effect the economy of a server. What effects the economy of a server is large amounts of gold being put into the game, a point that has been made several times.

[DrFaustus]

If anyone knows about the spending multiplier this is a great example. Basically, here's the scenario.
Player A has a rare worth 100k, which he sells to Player B (basically creating 100k for him). Player B loses 100k in gold, but keeps an item that has a value of 100k that will never be used, worn out, etc. If player B were to sell the rares he would receive his 100k back and player C would now own the rare. Through these transfers in ownership, a 100k item has created more than it's value in spendable income for the involved parties. This new gold is not inflationary gold because it was not created out of thin air, instead it helps our economy by being invested in various forms (by invest i mean it is spent on items.) Also rares definately increase in value overtime, so it is most likely that Player
B would see a profit when he sells his item, creating even more spendable income for reinvestment.

Nonetheless, the minority of players who own the majority of rares will become very rich.

Where the money is 'invested' is the biggest determinent of how the rares effect our economy.

A) They spend their newly acquired wealth on an expensive home, thus reducing the amount of money supply in the shard, causing deflation. (But at the same time, houses are actually a horrible gold sink, since they create an item that is worth exactly what one paid for it, so if the castle is ever sold, no money is really removed from the economy.)

B) They buy rares that they want, creating basically a closed circuit of money flow.

C) They spend the money on items from other players, like magic weapons, armor, or whatever. This most often gives money back to less wealthy players, but will basically create a complete circuit as well. Money is redistributed, nothing is added, end of scenario.

D) Regs, arrows, pouches, guildstones, etc are the real gold sinks, items that are used up and not re-sold between players. These remove money from the economy and cause deflation.

I feel that real-estate is a great investment, given the player base grows at a faster rate than house decay. Everyone needs a macroing establishment, and when/if the server runs out of available spots for the larger housing units (Which I don't think will ever happen) those previously placed houses will spike in value. But basically rares don't hurt the economy...they're worth what one will pay for them, and they merely generate a new form of trade within our already boring economy.

[Deadiam]

If anyone knows about the spending multiplier this is a great example. Basically, here's the scenario.
Player A has a rare worth 100k, which he sells to Player B (basically creating 100k for him). Player B loses 100k in gold, but keeps an item that has a value of 100k that will never be used, worn out, etc. If player B were to sell the rares he would receive his 100k back and player C would now own the rare. Through these transfers in ownership, a 100k item has created more than it's value in spendable income for the involved parties. This new gold is not inflationary gold because it was not created out of thin air, instead it helps our economy by being invested in various forms (by invest i mean it is spent on items.) Also rares definately increase in value overtime, so it is most likely that Player
B would see a profit when he sells his item, creating even more spendable income for reinvestment.

Nonetheless, the minority of players who own the majority of rares will become very rich.

Where the money is 'invested' is the biggest determinent of how the rares effect our economy.

A) They spend their newly acquired wealth on an expensive home, thus reducing the amount of money supply in the shard, causing deflation. (But at the same time, houses are actually a horrible gold sink, since they create an item that is worth exactly what one paid for it, so if the castle is ever sold, no money is really removed from the economy.)

B) They buy rares that they want, creating basically a closed circuit of money flow.

C) They spend the money on items from other players, like magic weapons, armor, or whatever. This most often gives money back to less wealthy players, but will basically create a complete circuit as well. Money is redistributed, nothing is added, end of scenario.

D) Regs, arrows, pouches, guildstones, etc are the real gold sinks, items that are used up and not re-sold between players. These remove money from the economy and cause deflation.

I feel that real-estate is a great investment, given the player base grows at a faster rate than house decay. Everyone needs a macroing establishment, and when/if the server runs out of available spots for the larger housing units (Which I don't think will ever happen) those previously placed houses will spike in value. But basically rares don't hurt the economy...they're worth what one will pay for them, and they merely generate a new form of trade within our already boring economy.

This is a valid point, and what WILL happen eventually is Keep \ Castle avail spots will decrease dramatically making these good investments. Housing location can also be a huge selling point for a house. I am sure it will be nothing like my pay-to-play days when a house was about to decay there were 20 people farming it BUT I do see location being of some increased house value.