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Chssmius
Deep Core Mining Inc.
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Posted - 2010.03.31 17:10:00 -
[1]
I think speculators are under estimating by just how much demand is currently inflated because of the IER. A demand reduction of a mere 10%* and the supply increase at the bottleneck low-end minerals (as suggested in the blog) could very well put the price of all minerals in free fall until the basket quasi-stabilizes around the new insurance values. At least, until the next insurance re-evaluation or the next major mineral change.
*I think this may be conservative as approximately 350 tier 3 battleships a day being self-destructed is equal to ~10% of the Jita Trit volume per day.
We are almost certain to experience a situation not entirely unlike that of farmers and corn in the 1930s leading to the passing of the AAA in the U.S.A. as a part of the New Deal in 1936 and again in 1938. That is, falling demand for minerals is met by rising supply from mineral producers, meaning deflation and surplus. A trend that will continue with every insurance adjustment until enough producers leave the market and pickup other professions that flood the market with isk, raising demand and inflating prices until the next time the equation changes.
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Chssmius
Deep Core Mining Inc.
|
Posted - 2010.03.31 17:42:00 -
[2]
 Originally by: cosmoray
I don't know why people are wildly speculating, the swings yesterday were knee-jerk silly.
According to some rough calculations I made from the drone regions (could change and be +/-).
Changes to mineral supply from drone region:
Trit = +18%
Pyerite = +54%
Mexallon = +32%
Isogen = +70%
Noxcium = - 22%
Zydrine = - 40%
Megacyte = - 66%
Although drone regions will reduce the high ends, the sov bonus to mining may counteract that, along with reduced demand for insurance fraud.
Theoretically mega/zyd should go up, but have to see whole package changes.
What we really need to do is adjust the percentage of each mineral coming from the looting reduction. The assumption is that the "large" meta 0 modules will virtually disappear and be supplanted(mostly) with scrap metal. I feel the loot data + the drone compounds would be most telling for nox and everything below(based on historic data) and zyd, mega, and morph continue to be the primary exports from 0.0. I don't anticipate significant transformation of 0.0 mining to occur from whatever is being done to null-sec ores and belts. And whatever change there is I only see as serving to further depress the low-end minerals.
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Chssmius
Deep Core Mining Inc.
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Posted - 2010.04.01 03:53:00 -
[3]
Edited by: Chssmius on 01/04/2010 03:54:05
Originally by: Celia Therone
Originally by: Taerna Kallintte
This is fairly close to my rough estimations (I didn't assume ALL Loot would disappear.)
So, if the IED currently takes 40% of the current minerals, then prices would remain fairly stable, and miners would have a larger control of the market.
A lot of IF's in that statement.
Looking at this another way, wouldn't one expect that high sec mining income without insurance floor subsidy would fall to approximately that of high sec ice mining (with a small premium as mining isn't quite so afk as ice harvesting)? Which could imply a drop of 30-45% for high sec mining? Caveat, guestimating numbers.
That is in the neighborhood of what I am guessing the low-ends will drop by, but what do I know.
All of this is very speculative.
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