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Epsilon Bathana
EPS Kings
8
   |
Posted - 2013.01.08 23:25:00 -
[1] - Quote
Alex Grison wrote:
....
6) The margin trading skill in eve does not work the same as margin trading IRL. When you are using the margin trading skill in eve. The broker is not lending you any money. And you are still required to pay-in-full when someone attempts to fill the order. Therefor there is no debt on either party. The broker returns the money that was placed in escrow minus transaction fees. And the order is removed.
...
Isn't the returning of the escrow to the person who placed the buy order WRONG?
In my opinion he is at default and the escrow should go to the "damaged" party, being the player who tried to sell against the buy order. Additionally the intended seller shouldn't have to deliver any of the goods (also in case of buy orders for multiple items with/without a minimum quantity set.
In order not to completely penalize honest traders, the change could include a 1 (x?) day notice period, in which the buyer is summoned to provide additional ISK to complete the transaction. Of course during that time the buyer can't cancel or alter the outstanding order. |
Epsilon Bathana
EPS Kings
9
|
Posted - 2013.01.11 13:56:00 -
[2] - Quote
Alex Grison wrote:
....
When a margin order fails to go through there is no "damaged" party. The money on escrow goes back to the person who placed the order. And the person with the items keeps the items. technically the only person with "damages" is the person who placed the margin order. Those damages being the market fees they paid to put up the order.
Margin trading in eve does not work like margin trading in real life. The trader is not borrowing any money. and thus has no debt to default on. Because of this, there is no reason for a margin call as you described.
All investments in eve are long positions. You cannot sell short.
By placing a buy order one enters into an agreement of buying an X amount of units for an Y amount of ISK of an at that time unknown seller.
When the margin order fails to go through the buyer hasn't honored this part of the agreement and which in case of MT scams is intentionally. The other party of the agreement, the seller , finds the agreement broken and suffers loss, namely he didn't get the ISK he is entitled to and therefore is the "damaged party". The height of his damages, being wasted time, the full amount of ISK or something else/in between, is less relevant. The buyer doesn't have damages in the sense that they were caused by actions of others. His loss happened the moment he made the order.
ESCROW is not just a deposit for covering the market fees. Those can be calculated and processed at creation of the buy order. It should be primary a security for the seller. That's why I'm saying that the ESCROW mechanism is broken in EVE if the seller is not the beneficiary of the money in case of a fallen through agreement. If however it is considered correct, than ESCROW is a unnecessary feature, because the behaviour won't be different to not having ESCROW (or in case of post deal calculated fees an ESCROW of 0.25 - 2% depending on Accounting and Broker Relation skills)
By the way I'm not talking about an interim recalculation of the margin and the settlement of that, but about the closure of the deal. So your reference to margin call is not correct. |
Epsilon Bathana
EPS Kings
9
|
Posted - 2013.01.11 17:07:00 -
[3] - Quote
How the seller came to the goods is irrelevant. He could have manufactured the items, he could have stolen the items, he could have bought the items (for a normal or inflated price). It is irrelevant.
The buyer started an agreement and he broke it when somebody hold him to it!! And because the ESCROW is returned to the buyer, he does so without consequences. He remains unknown and doesn't have to pay (market fees are irrelevant in this context because they are paid one way or another)
Consider the following scenarios:
- Seller places an order at the market for an item at a particular price. Somebody wants to buy it and clicks buy. The seller reconsiders and says "nah, I don't feel like selling it for that price or to you". He can't.
- A person creates a contract to have something transported from A to B within time frame. Somebody accepts the contract, but doesn't deliver the package. He pays a price in the form of not having the collateral returned to him.
The argument that it compensates the creator of the contract for his losses is not valid since very often the collateral exceeds the value of the transported goods and also are used as a source of income by tricking transporters to go past a gank camp.
- Agent offers a mission. You accept the agreement, but fail or abort it. Result: you pay the price in the form of a standing loss.
Now playing devil's advocate:
If think that ESCROW should not be a security deposit, then you agree it can be removed as a whole, right? |
Epsilon Bathana
EPS Kings
9
|
Posted - 2013.01.11 22:34:00 -
[4] - Quote
I'm interesting to see your opinions on the following:
For whom is the ESCROW intended (as a beneficiary) in case of a buy order?
- The buyer.
Because he runs risks that the items don't get deliver
Because he needs ISK to place other buy orders
Some other reason....
- The seller.
Because he runs risks that the buyer doesn't have the ISK to actually pay for the items. For a new buy orders placed unskilled ESCROW is 100% and all his risk is covered. With buyer's MT skill his coverage of risk decreases to 23%
Some other reason...
- EVE
Behave it runs the risk that the buyer will not be able to pay the market fees at completion of the order
Some other reason...
For those choosing nbr 1 a followup question: are you talking about ESCROW or the lowering of ESCROW by means of Margin Trading skill?
For those choosing nbr 2 a followup question: Is his risk covered given the fact that a broken deal results in payout of the ESCROW to the person who placed the buy order.
For those choosing nbr 3 a followup question: Can't EVE protect is by collecting the ISK upfront and if it doesn't, isn't a maximum ESCROW of 2.5% ( 1.5% sales tax + 1% Broker fee) sufficient? |
Epsilon Bathana
EPS Kings
9
|
Posted - 2013.01.12 03:27:00 -
[5] - Quote
Interesting view points
Gizznitt Malikite wrote:
The funds collected and put into ESCROW were originally a means to protect the market..... It ensures market orders have some value behind them, just like sell orders do.
Of course there is a significant difference, sell orders (and afaik sell and buy contracts) have 100% value behind them. And buy orders? Due to MT skill and ESCROW returning to creators of buy order (I don't want to call them buyers any more  ), effectively no guaranteed value (to the market)
Gizznitt Malikite wrote:
If ESCROW was removed from the game, I could put up 100x as much in buy orders with my isk...
That is correct, although I do not see why that would be bad (or good)
Gizznitt Malikite wrote:
So, the question: is using Margin Trade to create false buy orders threatening the game or creating a problem that can't be dealt with?
Given that it creates general distrust towards the market, it threatens the game, but probably not sufficient to kill it. However MT scamming seems to be focused against new/young players and they are usually supposed to the future.
Gizznitt Malikite wrote:I understand your desire for vengeance... and support the creation of Financial Analysis and Market Analysis agents to find a target worthy of your ire. I also support allowing players to check WHO is placing market buy/sell orders prior to any transactions with them. Both of these options create interesting metagaming options to identify and attack your fellow market PvPers. But I don't support making the market "safe" for the ignorant...
Given people creativity neither your Agents nor the open order info will serve their purpose for very long. At first glance, in space commodities transfers and disposable alts will break the money trail very easy. |
Epsilon Bathana
EPS Kings
13
|
Posted - 2013.02.23 01:07:00 -
[6] - Quote
Quote:
Either invalidate the full transaction from both parties or hold the escrow and distribute it as remedy to the aggrieved party (because amazingly that is what escrow is for).
Absolutely. CCP used the term "ESCROW" which has RL meaning for something else in the game. People actually familiar with it are being misled into a false sense of security. People say that it is a mistake you (have to) make once.
Well, that argument would also be applicable if CCP used the term "sell" for operations having the meaning donate/give away for feel. But somehow I expect that would result in a lot more discontent and complains from the players and brushoffs "you have to know what you are doing" and "It is CCP's game, and even if by definition something is an exploit, it is not such until CCP clasifies it officially as such" would not be accepted |
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