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Ramblin Man
Empyreum
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Posted - 2006.10.25 07:43:00 -
[31]
Originally by: Wilfan Ret'nub
Originally by: Baun If you want to measure the overall damage inflicted you must look to the value of the asset. If your goal is to determine who can afford to fly the ships longer then the advantage is squarely on those who can produce.
You're ignoring that you gave your "producer" more capital than those you compare them with. Even more, producer's capital is invested (in T2 BPOs) and is creating goods (T2 stuff). Give the other side a relatively riskless investment with a comparable return (say ISS shares with double dividends) and do the comparison again.
Fair enough, but for the sake of this particular "Why buy a T2 BPO?" discussion, I'd say the alliance-supply point was made in the long run (strategically). If you'll let me assert that T2 production earns the best profits in the game, then, subsequent to the initial purchase, the owner of a T2 print will be accumulating capital more quickly than those we're comparing him/her with. Therefore, at some point in time both entity's capital, even sans the value of the T2 BPO itself, will re-equalize.
In short, - If BPOs earn profit more quickly than another method of investment + Then "eventually" BPO-holders will "buy out" their initial capital expenditure (to paraphrase the mock-aphorism)
At that point in time, Baun's example remains valid.
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Ramblin Man
Empyreum
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Posted - 2006.10.25 07:48:00 -
[32]
Originally by: Greenbolt Edited by: Greenbolt on 24/10/2006 16:48:03 My thoughts. My alliance like all other alliances most likely sells T1 and T2 items below market value to its members and during crisis and after sometimes below manufacturing cost.
And yet this is not a loss to them. Like the comment about bob losing nothing when it loses t2 ships.
You have to place a value on your alliance succeeding in its goals..be it dominance over an area...expansion...or just the joy of the hunt.
In some cases the value of isk is lower than the value of other goals... and throws all your pretty little economic models out the window.
If I ever got a T2 bpo ..it would be purely for building that component to provide to my corp/alliance at no more than 10 percent markup on cost unless there was no alliance demand.
But then to me..isk has little value. having fun hunting and killing things do..and having corp mates and alliance mates in ships that help guarantee I can achieve my goals do.
So I often sell ships - mission loot..mining minerals...offer rewards way below market - or even for free- to corp/alliance mates. Again..because the isk has no value to me compared to the joy of working together and hunting either pirates or angels.
To someone that 65 billion or 70 billion had less value than the Astarte BPO. Perhaps it was economic/isk building gain..or it was military power/expansion that they saw their gain.
Either model works and yet...neither matters..because its up to what the purchaser values most.
One of the initial assumptions of an economic approach is that all things can be monetized. If you want to take a spiritual, belief-based argument then that's a valid point, but it's not a position from which you can criticize economic models.
That's like saying Weather Forecasting is BS because it doesn't give you a hotdog. Okay, so you place a central emphasis on hotdogs. Weather Forecasting isn't about hotdogs.
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Ramblin Man
Empyreum
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Posted - 2006.10.25 08:08:00 -
[33]
Edited by: Ramblin Man on 25/10/2006 08:08:09
Originally by: Baun
Originally by: Ramblin Man
My upper-level economic exposure stems from environmental economics, where traditional cost-benefit analysis goes a bit batty if you can't convert everything to a value-neutral standard. So they've come up with all kinds of alternative ways of looking at things, which have probably rubbed off on me.
Well thats mostly because its hard to quantify the externalities.
That is similiar to this case, but its hard to argue that the externalities are any bigger than the advantage of being able to use the T2 ships, which may or may not be all that high.
I'd say impossible to quantify in any "hard" manner. Thankfully, I'd say externalities are largely (not completely of course!) absent from EVE economics. It's tough to have an unintended consequences when every attribute of an item is defined up front. Although the addition of pollution to the game would be interesting...
Thought about the situation and amended my earlier view. Subtract my last post from memory.
A much cleaner way to go about it would be to say, and correctly so, that T2 BPOs permit a substantial value-adding step to take place, miraculously increasing value independent of inputs (probably an artifact of them being a quasi-monopoly). Further than that... my lack of microeconomic knowledge is a brick wall.
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migwar
Viziam
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Posted - 2006.10.25 10:17:00 -
[34]
Originally by: Ramblin Man Edited by: Ramblin Man on 25/10/2006 08:10:38
Originally by: Greenbolt Edited by: Greenbolt on 24/10/2006 16:48:03 My thoughts. My alliance like all other alliances most likely sells T1 and T2 items below market value to its members and during crisis and after sometimes below manufacturing cost.
And yet this is not a loss to them. Like the comment about bob losing nothing when it loses t2 ships.
You have to place a value on your alliance succeeding in its goals..be it dominance over an area...expansion...or just the joy of the hunt.
In some cases the value of isk is lower than the value of other goals... and throws all your pretty little economic models out the window. ... But then to me..isk has little value. having fun hunting and killing things do..and having corp mates and alliance mates in ships that help guarantee I can achieve my goals do.
So I often sell ships - mission loot..mining minerals...offer rewards way below market - or even for free- to corp/alliance mates. Again..because the isk has no value to me compared to the joy of working together and hunting either pirates or angels.
To someone that 65 billion or 70 billion had less value than the Astarte BPO. Perhaps it was economic/isk building gain..or it was military power/expansion that they saw their gain.
Either model works and yet...neither matters..because its up to what the purchaser values most.
One of the initial assumptions of an economic approach is that all things can be monetized. If you want to take a spiritual, belief-based argument then that's a valid point, but it's not a position from which you can criticize economic models.
That's like saying Weather Forecasting is BS because it doesn't give you a hotdog. Okay, so you place a central emphasis on hotdogs. Weather Forecasting isn't about hotdogs.
and on what belief do you assume eve markets are about economy? Eve is a "game" Based on people having fun, If it was a valid economical model i know lots of people who sell things on the market at sub cost should be bankrupt? how many bankrupt eve players do you know? The value placed on actually having a t2/HAC ship to play in has to be of high value.
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Viktor Kusanagi
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Posted - 2006.10.25 12:21:00 -
[35]
It is a monopoly right now. CCP release more T2 BPOs, stop the monopolies. Monopolies are bad! Stop them!!
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DuckM4n Vo
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Posted - 2006.10.25 12:22:00 -
[36]
Btw. It is an economic model because of two things, supply, and demand.
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Pallas Athene
N.A.G.A Investment Association
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Posted - 2006.10.25 13:46:00 -
[37]
Originally by: DuckM4n Vo Btw. It is an economic model because of two things, supply, and demand.
Yes, it¦s true, it¦s an economical model - but a very abstract one.
You don¦t have to make ISK to live a good life , you don¦t have to feed your avatar, don¦t have to buy clothes, save up for retirement or dental care .....
EVE¦s economical model is based on idealistic values.
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Wilfan Ret'nub
Singularity.
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Posted - 2006.10.25 17:42:00 -
[38]
Originally by: Ramblin Man If you'll let me assert that T2 production earns the best profits in the game, then, subsequent to the initial purchase, the owner of a T2 print will be accumulating capital more quickly than those we're comparing him/her with.
This is a very good point you've made. Together with other hard-to-quantify, long term advantages, it makes a good case for T2 BPOs.
Unfortunately, the point about buying out the T2 BPO over time is wrong. It applies the just same for other types of investment. ------ No ISK, no fun |
Ramblin Man
Empyreum
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Posted - 2006.10.26 00:58:00 -
[39]
Originally by: migwar
Originally by: Ramblin Man Edited by: Ramblin Man on 25/10/2006 08:10:38
Originally by: Greenbolt ...
One of the initial assumptions of an economic approach is that all things can be monetized. If you want to take a spiritual, belief-based argument then that's a valid point, but it's not a position from which you can criticize economic models.
That's like saying Weather Forecasting is BS because it doesn't give you a hotdog. Okay, so you place a central emphasis on hotdogs. Weather Forecasting isn't about hotdogs.
and on what belief do you assume eve markets are about economy? Eve is a "game" Based on people having fun, If it was a valid economical model i know lots of people who sell things on the market at sub cost should be bankrupt? how many bankrupt eve players do you know? The value placed on actually having a t2/HAC ship to play in has to be of high value.
A) If it's a market, then it can be analyzed economically. B) I imagine I know what you're trying to say, but if you can't phrase your point coherently and correctly then I'm not going to take the time to respond. C) Hint) Re-read my post and try and find where I mandated an economic approach (what presumably flicked the flame-on switch). There are other approaches, belief-based arguments among them. The difference between a wise man and a smart man is the ability to unchain yourself from the shackles of a single paradigm and view the same problem from multiple perspectives.
Originally by: Wilfan Ret'nub
Originally by: Ramblin Man If you'll let me assert that T2 production earns the best profits in the game, then, subsequent to the initial purchase, the owner of a T2 print will be accumulating capital more quickly than those we're comparing him/her with.
...
Unfortunately, the point about buying out the T2 BPO over time is wrong. It applies the just same for other types of investment.
The phrase "buying out" was intended to be taken more as amusing reference to its typical, incorrect usage than literally. In essence, I was suggesting an accounting trick that could move us to "Baun-world" in the long run.
If two corps started with equal capital, and one corp invested in a manner which delivered superior profits (T2 production), then that corp would inevitably "gain" capital over the inferiorly-invested corp. Furthermore, as long as profits remained superior, the difference between the two corps would eventually equal the value of a T2 BPO. At that point in time, both corps could have equal working capital, in addition to one corp possessing a T2 BPO. Baun-world, product of a long enough timespan.
Am I missing something, aside from the premise that T2 production produce superior profits?
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Wilfan Ret'nub
Singularity.
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Posted - 2006.10.26 09:20:00 -
[40]
Ah, if the point of the second part was just to illustrate what happens with superior profits (of T2 in that case), then you're right. I just wanted to make sure noone would get the idea that you can "buy out" investment only when investing in T2. ------ No ISK, no fun |
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Ramblin Man
Empyreum
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Posted - 2006.10.26 13:13:00 -
[41]
Edited by: Ramblin Man on 26/10/2006 13:12:46
Agreed!
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Macon Squaredealer
Squaredeal Enterprises
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Posted - 2006.10.26 14:26:00 -
[42]
Originally by: Ramblin Man Am I missing something, aside from the premise that T2 production produce superior profits?
Yes. YouÆre looking only at income stream and ignoring capital risk. I enjoyed reading your posts, so let me throw one out here to illustrate what I mean.
Lets suppose two 100% trustworthy industry oriented corporations form up today each with an equal amount of isk. Corporation A buys numerous researched Tech 1 BS, BC, and other BPO's and BPC's. Think of corporation A as a traditional producer - nothing flashy or sexy but a solid steady income stream whose assets have little value of depreciating. Maybe they might expand into trading, hauling, moon mining, etc with their excess profits. They are going to turn a profit every month with their diversified income stream and the assets of the corporation have little chance of ever being valued for less on the player market than what they paid for them.
Corporation B buys a popular Tech 2 BPO. There is no doubt that right now, under the current rules, that corporation B can generate more profit than corporation A. But what about after Invention comes out? Will that multi-billion isk BPO still be worth what the corp paid for it? Will their margins suffer? How about six months from now? Will CCP come out with some other skill or more BPO drops to shut up complainers, or a nerf over the next year that hammers the value of the one and only significant asset of the corp? I have no idea, do you?
I don't think investing in either corp is wrong, but I do think a lot of the people oversimplify their decision into something like "I want the tech 2 BPO approach because it will generate a bigger profit" without taking risk into account.
Corp A û Steady, diversified income stream, low risk to asset values. This is the "safe" play. Corp B û Higher, undiversified income stream, unknown risk to asset values. This is the "growth" play.
There is no ôrightö answer, invest or take the approach you are comfortable with. I invest in both.
___________________________________________ Watch for the Squaredeal Enterprises IPO in the coming months. |
migwar
Viziam
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Posted - 2006.10.26 16:27:00 -
[43]
Not sure what the flame on switch comment was for?
The point i made was a valid one, I realise that these discussions are based on the assumption that everything has an isk value.
But those who are in the same market as you arnt always making the same assumptions.
Maybe its the terms im using
The value of owning a BPO of a popular PVP ship is great than its cost in ISK for people who want easy access to the t2 varients
maybe some of you more eloquent types could translate this?
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Ninefingers
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Posted - 2006.10.26 17:26:00 -
[44]
As long as you don't over spend when buying the BPO it is an investment just like anything else. House, savings account, stocks, bonds, etc. The whole time you have ownership and provided you are producing them you are making "interest" on your cash that would otherwise just be sitting in the wallet gaining cobwebs. Even if you "over spend" per say then you just have to hold on to it long enough to break even before selling. T2 BPO's will always be worth something so it isn't like you will lose money unless you happen to lose the print while moving it or someone steals it from your corp.
Could be as someone else said earlier, maybe they didnt own the BPO yet and really really just had to have it!!!
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WhiskeyDP
The Druids
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Posted - 2006.10.26 23:59:00 -
[45]
invest 75b into t1 bpo's and i can promise u that u will make more isk/month then khatred will do from that astarte bpo. invest 75b in t1 bpo's and u will beat most t2 bpo's when it comes profit/month(comparing ur profit per invested isk(month that is) xpt a very few of the t2 bpo's ingame actually. ppl however want easy isk without any work. i dont get why ppl cry so much about t2, its not all about t2 in this game. ==================
=== eve is not all about isk, its about enjoying the game. lots of iskies is not the same as enjoying the game |
Naal Morno
ECP Rogues Dusk and Dawn
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Posted - 2006.10.27 01:20:00 -
[46]
I have corp mates who made way more money on manufacturing T1 items than buying any T2 bpos for what they invested would yield. However, turning that high % in requires work, something anti T2 whiners do not like doing. Instead of whining so much and long on forums, get to work.
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The cloaky orchestrator |
Ramblin Man
Empyreum
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Posted - 2006.10.27 18:17:00 -
[47]
[To edit & reply later tonight... been a long week. ]
[And yeah, just bored and browsing the forums now. Don't think I should pontificate on three hours of sleep though.]
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Ramblin Man
Empyreum
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Posted - 2006.10.28 14:49:00 -
[48]
Edited by: Ramblin Man on 28/10/2006 14:49:15
@ WhiskeyDP and Naal Morno, re: Relative T2 Expectations
Characterization of both points, T1 beats T2, given equal ISK invested, on both an absolute profit basis and a profit-per-investment basis. The only difference between the two is that T1 requires more work.
Given the authority with which it's pronounced (and my utter unwillingness to delve into spreadsheets at 10:30 in the morning for a quantitative dispute), I'd raise two counter arguments.
Assuming the 75B tag is in some way indicative of its profit-earning capabilities, 1) Investing 75B into a T1 production chain just about tops you out through carriers (I think that'd be about right). Now, given that you can invest in two 75B T2 prints, how can you invest 2x that in the T1 market? 3x? 4x? The T1 market simply doesn't allow that level of investment.
2) Okay, so I concede the absolute profit advantage to T1 production (and it's certainly plausible that increased volume recoups lower absolute profits, although, sans hard figures, I think it could go either way). How much time is required to manage "75B worth" of T1 production compared to "75B worth" of T2 production? I think it'd be fair to say that we're bumping up against the physical constraints of a 24-hour / 1,440 minute / 86,400 second day here. Taking limited playtime into account, you start to compare the profits earned by a player with the profits earned by a corporation. Equal?
PS: Sorry for posting OT in one of your auctions WhiskeyDP; it irked me in the morning.
---------------------------------------
I'd like to make sure to note that I'm looking at this discussion as a pro-/anti-T2 investment strategy debate. I don't care whether or not it's moral or right or fair or fun; I'm just interested in what the truth of the market is.
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Jacque Custeau
Knights of the Minmatar Republic
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Posted - 2006.10.29 23:23:00 -
[49]
I don't think releasing additional t2 BPOs at this stage is going to solve anything. Chances are the new BPOs will go to people with little interest in production. In turn, the current t2 barons will buy them up with their accumulated wealth and we will back where we started. The only difference is that said barons will be making even more money
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Baun
4S Corporation Morsus Mihi
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Posted - 2006.10.30 01:15:00 -
[50]
Originally by: Jacque Custeau I don't think releasing additional t2 BPOs at this stage is going to solve anything. Chances are the new BPOs will go to people with little interest in production. In turn, the current t2 barons will buy them up with their accumulated wealth and we will back where we started. The only difference is that said barons will be making even more money
That only fails to solve the "problem" if you percieve the problem to be certain people getting too rich.
If, however, the "problem" is high t2 prices then releasing a few more BPOs of items that have HUGE margins will solve the "problem."
The Enemy's Gate is Down
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Yumi Katanawe
Caldari Demon Womb
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Posted - 2006.10.30 10:52:00 -
[51]
T2 ships price will crash once kali hits.
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Ray McCormack
BIG
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Posted - 2006.10.30 11:47:00 -
[52]
Originally by: Yumi Katanawe T2 ships price will crash once kali hits.
I would love to borrow that crystal ball of yours, but it does seem a tad melodramatic.
| BMBE ISK Loans | Skills Showroom | 706996 | |
Yumi Katanawe
Caldari Demon Womb
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Posted - 2006.10.30 13:32:00 -
[53]
Edited by: Yumi Katanawe on 30/10/2006 13:33:43 Invention Additional BPO's seeded Tier2 Battlecruisers HP boost indirectly nerfs T2 ships Rigs
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Ramblin Man
Empyreum
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Posted - 2006.10.30 14:25:00 -
[54]
Edited by: Ramblin Man on 30/10/2006 14:26:35
Originally by: Yumi Katanawe Edited by: Yumi Katanawe on 30/10/2006 13:33:43 Invention Additional BPO's seeded Tier2 Battlecruisers HP boost indirectly nerfs T2 ships Rigs
Invention - Material requirements make large-scale construction impossible due to limitations on the rate at which you can get RPs, based on the current dev comments
Additional BPO's seeded - They're reseeding old BPOs? This one *might* knock the prices down a bit, but I missed the dev comment.
Tier2 Battlecruisers - Imo the agility concerns are still going to make HACs preferable.
HP boost indirectly nerfs T2 ships - Wouldn't it boost T2 ships (and "harder" T2 ships like HACs in specific), considering they have higher resistances and resistances are > boosting when damage exceeds boost-amount (ie PVP, and I believe Tux and others worked out the math)?
Rigs - True, the slot differential lowers the maximum potential difference between the classes, and if rigs are prevalent enough it should have an effect. If.
Change HAC prices, yes. Crash, no.
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Baun
4S Corporation Morsus Mihi
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Posted - 2006.10.30 14:35:00 -
[55]
Originally by: Ramblin Man
Additional BPO's seeded - They're reseeding old BPOs? This one *might* knock the prices down a bit, but I missed the dev comment.
I think he made that one up.
I have seen no indication that they are seeding OLD BPOs.
Instead it would seem that they are seeding the Rig BPOs, and the missing t2 BPOs (Relays, Damage Controls, Heavy Assault Missle etc.)
The Enemy's Gate is Down
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KHEN
Gallente New Horizons
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Posted - 2006.11.07 22:27:00 -
[56]
With Invention, CCP will have the lever they never had before to an automated control of the prices of the most wanted T2 stuff :
Very many people will try to invent HAC BPC, Cap Rech 2 bpc and most wanted T2 mods and ships. Even if you have a small chance to get the bpc and even if it takes long, the quantity of T2 BPC will be directly related to the number of inventers working on it. And the number of "inventers" will be directly related to the market price of the stuff they try to copy. So on the long term, the market will determine the right and real prices for these stuffs
Until now the game was wicked by the few T2 BPO seeded. And by the fact that the T2 bpo holders would easily buy any new seed of T2 BPO. Invention will introduce something more natural in prices : Competition against most expansive stuffs and reduced influence from monopolies
Once more it demonstrates how CCP guys are clever : they don't hurt the actual BPO holders at all but they force T2 ships and mods to a self regulation in prices. In the end everyone should be happy of that
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