Game Economy and the gil redenomination

[Denmo]

Hey y'know, at least SE was kind enough to let us know this waaaaay in advance of actually playing 2.0.

And then we have the beta period to experience the in game economy first hand (where we won't have access to our current char's inventory).

Those that are worried seem to think that 2.0 will release on November 12th, right after 1.0 shuts down. But really, we'll have several months.

The only people this will be an absolute shock to are those returning after not playing, not playing the beta, and not listening to any news related to FFXIV. I seriously doubt these people will have power to sway the markets.

[Molly_Millions]

Supply and demand. There won't be enough supply of gil for sellers to demand the same price as in 1.0. :P

[wolfsraine]

Gonna have to side with your husband.

No one is going to pay the 1.0 price for 2.0 items. Anyone who tries to sell it for the 1.0 price (specially high end items like 20m materia / 60m triple melds) will never have their items move. It really is that simple.

If the economy went the other way and 10m became 100m, do you think sellers would still be asking the same old 10M for the materia? Hell no, theyd want 100m now.

I think the point is, and this is the way I see it as well, is that items will become more expensive relative to the amount of gil we have.

Lets say I have 50 million gil and so and so triple meld hat of supergiantepeen is selling for 20 million currently. That costs me 40% of my gil.

Now 2.0 comes along and my 50 million is now 5 million, and now that super awesome hat may have dropped in price, but there is no way it drops to 2 million, it just isn't feasible for that to happen. Let's say it drops to 4 million, even that's a stretch going from 20 mil. Now that same item costs me 90% of my gil. Sure at that point I won't buy it, but if you think for a second that people aren't going to have the money to pay that price then you're just delusional...

So yea, I agree with the OP. The market will adjust downwards, however it will not adjust far enough. To those saying nothing will change, good luck to you and keep believing that.

[Promethevs]

I think the point is, and this is the way I see it as well, is that items will become more expensive relative to the amount of gil we have.

Lets say I have 50 million gil and so and so triple meld hat of supergiantepeen is selling for 20 million currently. That costs me 40% of my gil.

Now 2.0 comes along and my 50 million is now 5 million, and now that super awesome hat may have dropped in price, but there is no way it drops to 2 million, it just isn't feasible for that to happen. Let's say it drops to 4 million, even that's a stretch going from 20 mil. Now that same item costs me 90% of my gil. Sure at that point I won't buy it, but if you think for a second that people aren't going to have the money to pay that price then you're just delusional...

So yea, I agree with the OP. The market will adjust downwards, however it will not adjust far enough. To those saying nothing will change, good luck to you and keep believing that.

The issue here, is that prices aren't set by some divine dictation. They're set by people who estimate the value of an item by comparing the effort to produce an item with the effort to produce its value in gil. That won't change in 2.0. To say "there's no way prices will drop low enough" is to ignore this. You're basically saying that in the example you gave, the price will go up 100% for no reason other than that people got fooled by a 1/10 redenomination, as simple as it is in concept. How long do you think that will last?

Prices are what they are now because the economy has found the balancing point for each item between "buy it" and "make it yourself." Are you saying that dynamic is going to fundamentally change because everyone traded in their $1 bills for $10 bills at a 1:10 ratio?

[Ferth]

I think the point is, and this is the way I see it as well, is that items will become more expensive relative to the amount of gil we have.

Lets say I have 50 million gil and so and so triple meld hat of supergiantepeen is selling for 20 million currently. That costs me 40% of my gil.

Now 2.0 comes along and my 50 million is now 5 million, and now that super awesome hat may have dropped in price, but there is no way it drops to 2 million, it just isn't feasible for that to happen. Let's say it drops to 4 million, even that's a stretch going from 20 mil. Now that same item costs me 90% of my gil. Sure at that point I won't buy it, but if you think for a second that people aren't going to have the money to pay that price then you're just delusional...

So yea, I agree with the OP. The market will adjust downwards, however it will not adjust far enough. To those saying nothing will change, good luck to you and keep believing that.

.

I suppose I just have trouble with your assertion that "There is no way it will drop to 2 million."

For starters, we don't know what will change in regards to spirit binding, materia and items in general in 2.0. For all we know that triple melded hat could become worthless.

Second. That triple melded hat is not going to be the only one. It's not going to magically become the last triple melded hat in existence. It will follow the same rules of supply and demand as every other item out there.

Third. People will pay what they are willing to pay. I actually could use your same exact example against your argument: If a player has 50,000,000 gil right now and they are willing to pay 20,000,000 gil for this alleged triple melded hat of awesome, then that means that hat is inherently worth as you say 40% of their current wallet.

After 2.0 if the hat does not maintain its 40% station then that would seriously affect the player's willingness to buy it. Cause, I don't know about you... but I am stingy as hell. I certainly wouldn't be willing to pay double or more for items in 2.0. And for a large percentage of things, especially those items that are really expensive, the price just can't fluctuate that much in relative terms, because then it more than likely just won't sell.

[Quesse]

Economy real or fake is nothing you can accurately predict. People act with emotion, people remember previous pricing, they are psychologically programmed to pay/ask a certain price. Those habits will be really hard to break over even a few months.

An item selling for 2 million now will not instantly sell for 200k in the wards. To say with certainty that it will is just a guess.

It will probably start at 800k then maybe 500k then 400k - which is still DOUBLE its 1.0 price - and then maybe go down to 350k. Maybe even 300k. It may stay there for months.... forever. There will be lots of adjustments.

One thing is certain, is that things will not be selling for LESS than 1/10th. That being the case its more likely that they will be selling for more. We can all revisit this when the game launches in April XD

[Alhanelem]

I think the point is, and this is the way I see it as well, is that items will become more expensive relative to the amount of gil we have.

And our point is, that won't last. If prices are slightly higher, some people may still buy them, but the item iwll sell more slowly which makes undercutting easy and the price will gradually drop. The exception is if the demand for the item changes in 2.0, in which case the value of the item will change and people may be willing to pay a different price for it.

The demand for various items is likely going to change a lot in 2.0- So no, prices won't necessarily be porportionally the same as they were before, but this will be due to a shift in supply and demand and no other reason.

[Ferth]

Economy real or fake is nothing you can accurately predict. People act with emotion, people remember previous pricing, they are psychologically programmed to pay/ask a certain price. Those habits will be really hard to break over even a few months.

An item selling for 2 million now will not instantly sell for 200k in the wards. To say with certainty that it will is just a guess.

It will probably start at 800k then maybe 500k then 400k - which is still DOUBLE its 1.0 price - and then maybe go down to 350k. Maybe even 300k. It may stay there for months.... forever. There will be lots of adjustments.

One thing is certain, is that things will not be selling for LESS than 1/10th. That being the case its more likely that they will be selling for more. We can all revisit this when the game launches in April XD

I like how you start by saying you can't predict what will happen, then immediately predict a rather worst case scenario.

Are people going to try and put things up for too much? Of course they are. Some people might actually even pay those prices. But the trend will more than likely put prices in a very similar position as they are now after enough time has passed.

How long will be long enough? Who knows? Probably not longer than a few months.

Not to mention with all the changes to the battle system and with all the new content, prices may change based on what ends up being needed. Items that are big ticket now may become significantly less so in the new game. And some lesser used items may be put more into prominence.

Pessimism or optimism notwithstanding anything that happens after 2.0 launches, everyone will be going into those changes with the same relative wealth they will have on november 1st.

[Promethevs]

On another note, with likely changes to gather rates and to the value of materia on gear due to stat rebalancing, even if there were no redenomination, people would have to reevaluate how much everything is worth.

Economy shift is nonunique to whether you have a redenomination or not. The redenomination is nothing more than a placebo.

[Mijin]

This currency redenomination is primarily intended to reduce the excessively large values used in all transactions. We would like to reiterate that the effective purchasing power of your savings will not be reduced.

I would like to reiterate that lowering the cost of items from NPCs by 1/10th will not cause people to list items on the auction house for 1/10th of what they sell for now. People don't buy items from NPCs, so no one cares about that. Id also like to reiterate that this is a stupid statement, and there is no way you can predict how much, if at all, each individual items average sale price will drop on the AH.