The Current Economy

[Abriael]

I was also told that double-melding was a great gilsink but the more I thought about it, the more I realized that it actually wasn't since gil isn't actually removed from circulation when equipment blows up. So that's out...

It's an indirect gilsink. You don't blow gil directly, but you blow stuff you purchased with gil or that derives from stuff you purchased with gil. Even in the remote case that you got *everything* that blows up, and its ingredients, from drops, all of it has a monetary value, so it's still a gil sink.

Basically every operation that removes anything of monetary value (either gil itself or items) from the market is a gil sink.

[axemtitanium]

Yeah I understand that items have value and when they disappear, that value goes away. However, the amount of currency that exists in circulation does not go down so it does not directly counteract the devaluation of currency that occurs when you NPC items and etc.

The other thing about double-melds is that the resulting item has a much higher value than its parts. Think of it this way: if you fail, the "total economic loss" is that of the cost of the materials (material, equipment, ingredients, etc.), but if you succeed, the "total economic gain" is that of an item with a much higher value than all of the ingredients combined. I'm not sure what effect this has on the double-meld process as a gilsink...

[Abriael]

Yeah I understand that items have value and when they disappear, that value goes away. However, the amount of currency that exists in circulation does not go down so it does not directly counteract the devaluation of currency that occurs when you NPC items and etc.

Conceptually, items *are* currency, you just didn't transform them into it yet

[axemtitanium]

Items are not liquid in the same way that currency is though, and items are often NOT sold and thus stop being "treated" as a monetary instrument. A difficult problem to be sure and my economics background isn't necessarily up to snuff to de-tangle it lol.

[Shougun]

The other thing about double-melds is that the resulting item has a much higher value than its parts. Think of it this way: if you fail, the "total economic loss" is that of the cost of the materials (material, equipment, ingredients, etc.), but if you succeed, the "total economic gain" is that of an item with a much higher value than all of the ingredients combined. I'm not sure what effect this has on the double-meld process as a gilsink...

A by product of failing is a gil sink - wether players price the items perfectly above that gil sink or not doesn't exactly remove the gil sink in the first place. Specially since its RNG. Melding might be a whore of a gil sink to you if you failed every meld. And it might be a fountain of gil for someone who never failed.

However I can see how you want to talk about it as a point rather then two objects (which is a valid method). Like doing point calculations for physics :P

[axemtitanium]

My big problem with the double-meld-as-gil-sink concept is that currency =/= items. The circulation of items is not nearly as tightly controlled (at least in theory) as that of currency. Monsters drop items that have value all the time but only rarely drop gil and gil drops are always small. Double-melding is certainly a VERY effective item-sink but I would say that it's a terrible gil-sink since it doesn't actually do what gil-sinks should do: remove currency from circulation.

[Shougun]

My big problem with the double-meld-as-gil-sink concept is that currency =/= items. The circulation of items is not nearly as tightly controlled (at least in theory) as that of currency. Monsters drop items that have value all the time but only rarely drop gil and gil drops are always small. Double-melding is certainly a VERY effective item-sink but I would say that it's a terrible gil-sink since it doesn't actually do what gil-sinks should do: remove currency from circulation.

For items because of player inconsistencies (market flux) its safe to consider each and every item its own currency that can be converted between other currencies.

So just like in the real world (lame comparisons to real life, everyone falls asleep .. . ) when you convert Dollars to Yen or Yen to Dollars you get a different "market" but it is still a currency. You may buy into materia currency and then resell that same materia currency back into gil currency at a better price.

[Zdenka]

Clearly it's not sufficient to counteract the effects of RMT though and it certainly couldn't deal with the amount of gil dumped into circulation as a result of Atomos.

RMT doesn't add gil into the game; in theory they actually help remove gil from circulation through MW taxes. They farm a leve, which they gain no gil from because they don't complete it, and resale the skins on AH and remove 10% of the sale from the game. So actually RMT help's reduce inflation how they have operated in v1.0. Depending on what method's they use in 2.0 this might change.

It's an indirect gilsink. You don't blow gil directly, but you blow stuff you purchased with gil or that derives from stuff you purchased with gil. Even in the remote case that you got *everything* that blows up, and its ingredients, from drops, all of it has a monetary value, so it's still a gil sink.

Basically every operation that removes anything of monetary value (either gil itself or items) from the market is a gil sink.

This is 100% wrong. Item's only have a monetary value only at the point they are sold to an NPC. If they never get sold to an NPC they are not a gil sink when they are removed since no gil was removed at the same time.

Example: I farm all ingredients (mine/battle/fish etc) to make a Cobalt Haubergeon, this costs 0 gil, produces 0 gil. I then proceed to blow it up using farmed matters, and my own spirit bonded materia which also cost 0 gil to produce. This entire process neither added nor subtracted gil from the economy yet by your logic that Haub had value so when it blew up it somehow magically caused a gil sink.

Basically if item X isn't sold to the NPC (Inflation) or resold on the MW (Deflation) it has a value of 0 because its irrelevant to the economy. Because an item is "worth" something doesn't mean its a gil sink when it goes away because you could say the same thing about my Darklight Corselet if that was the case. If I drop that its a gilsink because items have value?

Anyways all means of inflation are:

1. Selling items to NPC Vendors.
2. Completing Quests/Leves/Missions.
3. Mob Drops (very small)

There is nothing else that causes inflation in the game.

Deflation (otherwise called "gilsink") is caused only by:

1. Ward Taxes.
2. Chocobo/Airship Rentals
3. Buying item's from NPC vendors.


Blowing up items by melding doesn't cause deflation, nor does dropping them on the ground etc.

[Abriael]

Blowing up items by melding doesn't cause deflation, nor does dropping them on the ground etc.

A gil sink isn't defined by the fact it causes inflation or deflation. Causing deflation is a consequence.

It's simply the removal of currency from the market. Items *are* currency, as they can be automatically echanged for currency (by vendoring them).

By the way, not sure who told you that RMT don't complete levequests. They do, and that's the whole reason why they go around in trains of eight multiboxed lalafells. By leve linking they multiply the gil earning from every levequest.

Once they're done with the leve allowance of a group of lalas, they move to the next (they have access to a ton of them) over and over.

[Altena]

We are talking about the value of gil, not the value of items. Farming/crafting items then blowing them up does not add or remove any actual gil value to the game. The only items that remove gil from the game, are items purchased with gil via an NPC (which are very few).

An item is farmed by person A, (increasing/decreasing the amount of gil on a server by 0).
Those items are then purchased by person B, so person A gets gil (this is circulation, not adding any gil into the game)
Person B makes Cobalt Hauby and sells it on the market (another example of circulation, no gil is being added or removed).
Person C buys that hauby and blows it up. No gil is removed from the game (aside from market taxes).

This is not a gil sink, as it does not increase or reduce the value of GIL in the game, it simply circulates it.

As for the items I was talking about - I am talking about "Coke" "Aquerius Whetstone" "hardened sap" etc etc