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Melaleuca
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Posted - 2007.01.11 18:54:00 -
[1]
having looked at what happened after revelations release with the shortage of minerals in empire and 0.0 how big do you think the reserve have to be to keep the market in check
i am planning a venture into this area so that i can make a profit or the corp which could be formed could make a profit if you can give an idea of how many of each type of mineral would be needed and how many people would be needed
good regards
mel
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Sphynx Stormlord
Gallente
Anqara Industries
Serenus Letum
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Posted - 2007.01.11 19:03:00 -
[2]
How long do you want to affect the price for?
Maybe look at the daily and weekly volumes sold in the regions you are most intersted in, to start with.
You probably want to be able to cover the entire supply for several days, at least.
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Nuska
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Posted - 2007.01.11 19:04:00 -
[3]
 Originally by: Melaleuca
having looked at what happened after revelations release with the shortage of minerals in empire and 0.0 how big do you think the reserve have to be to keep the market in check
Infinitely large.
Consider this: The game has been around for years, and many corps have hundreds of billions of isk sitting there idle. What they don't have is minerals. They can also not be bothered to mine them, or haul them from who knows where because that's simply not fun.
Instead they are willing to pay whatever it takes to get the minerals close to where they need them so that they can build the ships that will hours later be converted into space dust through PvP.
In the real world the market is essentially regulating itself because there is a value that can be placed on say a ton of steel. That ton of steel will never be more expensive than X because whoever buys it will want to make a profit with whatever it is he is using that steel for.
The same rule does not apply in EVE. In many cases profit is not an issue at all, it's about fun, and isk is readily available. So if the sellers would get together and charge 100isk per tritanium, the buyers would still buy it, because even at that price many would prefer to just pay rather than going through the agonizing process of mining/reprocessing for minerals themselves.
Note: 100isk/trit was an example, please do not get into arguing whether people would pay 100isk or not, it's really just to illustrate the concept that those with more isk than they could possibly spend in a lifetime will pay whatever is asked just to get what they want.
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Menkaure
Amarr
Vanitas Corp.
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Posted - 2007.01.11 19:08:00 -
[4]
huge, but not as big as you'd think.
Taking pyerite for example, as it was the worst hit - in lonetrek alone the units sold on average region wide is usually over 200m, with some days hitting 350m or more. Daily.
Taking a pre-inflation price of 4.1 for it, thats 820m (minimum) isk of trade in a single day, in a single region, alone. You'd have to supply each major region (say 5 or 6) every day for a long enough period for the market to stop increasing.
Say, 2 weeks or so, with 5 regions. Thats pretty much 14b units of pye without batting an eyelid, costing you a cool 57.4 billion isk. For pyerite alone.
That said, you could probably half that (or more) due to the fact there's still a great deal of minerals coming into the economy.
The eve mineral market is a huge steamroller of a beast that would be VERY hard to keep in check for a long period of time.
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Menkaure
Amarr
Vanitas Corp.
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Posted - 2007.01.11 19:12:00 -
[5]
Oh, and another thing: You'd have to remove that many minerals from the market to start off with, which would greatly increase the price anyway. Catch-22 kinda thing. :)
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Nuska
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Posted - 2007.01.11 19:37:00 -
[6]
One more thing to consider is the motivation of keeping mineral prices low. If someone is artificially keeping the price low, then someone else is losing money. If the goal is profit, then things are kind of backwards. Where does a mineral reserve corp, that keeps the price below where the free market would place it, make profit?
From a corp perspective I see better profit potential in hedging than in supplying the market from a reserve. Then again, hedging may not work in EVE at all, because there is no way to enforce agreements.
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Block Ukx
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Posted - 2007.01.11 19:43:00 -
[7]
I created BSAC Mineral Reserve Fundand IÆm currently looking for investors and people interested in such Reserve. Currently, I have two reserve locations, Kihtaled and Amo. At this stage, IÆm simply building up the Reserve mineral stockpile. As for the size of the Reserve, some people say billions, other trillions. In reality, the size of the reserve is going to be limited by the interest of investors and the manufacturing community.
I donÆt think that is possible for a single individual or corporation to create a reserve large enough to keep the market price in check. For that reason, my plan does not call for market domination, but rather a short-term relief for manufacturers during a mineral shortage.
For a Mineral Reserve maximum effectiveness, you need a network of Reserve locations all working together as one, miners willing to invest on the Reserve, and manufacturers willing to use the Reserve. This is not an easy task and is definitely not suited for short term investments.
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Trhendor
Amarr
Legio Nova Invicta
Lotka Volterra
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Posted - 2007.01.11 21:54:00 -
[8]
Uhm
If the price rise after an expansion (or a modification of the game ecc...) is because the manufacturers need more mineral
Now, if on the market in the instant after the expansion there are X minerals at Y price is because a number of people is mining them
If you force the prices to not rise, the player WON'T notice that after expansion more ppl buy minerals and nothing would chance if not when the reserve will be depleted! Only then the ppl will see the prices arise and start to mine to rebalance the market.
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Block Ukx
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Posted - 2007.01.11 22:46:00 -
[9]
Trhendor,
I agree with you. That's why you need miners working directly with the reserve.
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Nuska
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Posted - 2007.01.11 22:58:00 -
[10]
Edited by: Nuska on 11/01/2007 22:56:52
Originally by: Block Ukx
That's why you need miners working directly with the reserve.
The question that remains unanswered is why miners would want to sell minerals at a below market price to the reserve, if they can just as easily get more cash from readily available buyers on the open market.
Right now the whole thing looks like this:
1. Mine for the Reserve.
2. ???
3. Profit
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Block Ukx
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Posted - 2007.01.11 23:45:00 -
[11]
Because the Reserve would also protect miners. When market prices drop significantly, the Reserve would buy from miners to encourage them keep mining.
For example, while Pyerite prices are significantly high, miners would be encourage to sell their minerals to the market. At the same time, Tritanium prices are dropping and when they reach certain levels that miners feel unacceptable to their time and pocket, then the Reserve would purchase their Tritanium at more reasonable prices.
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Nuska
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Posted - 2007.01.11 23:58:00 -
[12]
Originally by: Block Ukx
Because the Reserve would also protect miners. When market prices drop significantly, the Reserve would buy from miners to encourage them keep mining.
I see that reasoning. However, EVE is not the real world, if the prices for minerals are too low to be worth someone's time, then the miner can just stop mining and do something else instead (unlike real world miners who have to feed their families).
I am not trying to be a Debbie Downer here, but I do think that the Reserve idea is based on unrealistic assumptions about what will happen in the game. Having said that, everyone is of course entitled to their opinion. ;)
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Block Ukx
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Posted - 2007.01.12 12:17:00 -
[13]
I have been running a manufacturing company for 9 months. I have been selling ships and ammunitions, no fancy T2, just regular T1, and making a small, but reasonable profit. One thing that I have learned out of my experience as a miner/manufacturer is how disruptive mineral price fluctuations and availability can be to your production company and to your profits. At times, lack of reasonable priced minerals can bring the manufacturing lines to a halt. Likewise, unreasonably-low mineral prices can discourage mining. This up and down cycles induces a very inefficient mining and production industry.
Based on my experience as a miner/manufacturer, combine with the fact that a Mineral Reserve can be very profitable; I created my new venture û BSAC Mineral Reserve Fund. While my model is very simple, buy minerals and sell them for a profit, it can be extremely useful to miners and manufacturers alike. For miners, the Reserve is a place to dump excess minerals when prices drop. For manufacturers, the Reserve is the place to get minerals during mineral shortages.
I have tested the Mineral Reserve idea in a much smaller scale during the past month, and it has proved extremely beneficial to my production lines, while the Reserve made a profit.
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Vasiliyan
PAX Interstellar Services
Anarchy Empire
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Posted - 2007.01.12 15:50:00 -
[14]
http://en.wikipedia.org/wiki/Black_Wednesday
There used to be a system called the ERM which attempted to balance the prices of various European currencies against one another. Some speculators realised that this was a huge opportunity to get the reserve to give them money by pushing the currencies around, and as a result the UK government lost a lot of money.
"The market can stay irrational longer than you can stay solvent."
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Block Ukx
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Posted - 2007.01.12 16:45:00 -
[15]
Fees and redemption rules built in the BSAC Mineral Reserve Fund should prevent a situation like the one describe by Vasiliyan.
Redemption Fee: A 10% fee on sales of shares held less than one month, a 5% fee on sales of shares held less than six month. This fee is paid directly to the fund and therefore is not considered a load.
Redemptions Rules:
1) Potentially disruptive redemptions. BSAC reserves the right to delay payment off all or part of a redemption for up to seven calendar days if BSAC reasonably believe that a cash redemption would disrupt the fundÆs operation or performance or that the shareholder may be engaged in frequent trading. Please contact BSAC before you attempt to redeem a large ISK amount, you may avoid delayed payment of your redemption.
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Lee Walker
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Posted - 2007.01.13 09:49:00 -
[16]
Originally by: Vasiliyan
"The market can stay irrational longer than you can stay solvent."
Nice quote. ;)
When does the Reserve stop buying minerals at prices higher than the open market? An how is the decision being made from whom to buy and from whom not to buy when the open market price is lower than the Reserve buy price and considering that there will be multiple sellers who are all "entitled" (?) to the same high above open market price.
Lee Walker speaks out as to what really happened to EVE-Trader.net |
Moltke
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Posted - 2007.01.13 14:07:00 -
[17]
That was supposedly quoted by J.M. Keynes. Anyways, at the very best, you would only be able to moderate prices. The US Strategic Reserve stockpile vs. the commodity price rise in 2006 as an example.
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Shadarle
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Posted - 2007.01.13 18:41:00 -
[18]
I questioned the previous person who tried to do one of these and I still question the OP here as well. Why would anyone actually want to be a part of this? If I invested in a mineral reserve corp I would hope that their goal was to corner the mineral market... causing a large up-tick in prices for which they could exploit for massive margins. I'd be a moron to invest in a reserve that intentionally wanted to forgo profits in order to keep the market steady...
I am a producer now and have been a trader even longer... market fluctuations are the key to making massive money if you're smart. I made more money due to Revelation's price jump than I could have imagined... and I didn't plan for it one bit. Anyone that sees prices increasing can make a KILLING in countless ways. It's only a fool who produces products and dislikes a price hike across the entire market. Your entire current stock of materials/product jumps in price.
Anyone who actually buys into a scheme like this is being scammed imo... as it will only benefit a couple of people at the top who know what is actually happening with the market. Everyone else is just funding their soon to be massive profits.
Tanking Setups Compared
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Wyke Mossari
Gallente
Staner Industries
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Posted - 2007.01.14 14:45:00 -
[19]
Edited by: Wyke Mossari on 14/01/2007 14:41:30
IRL national reserves for things like Oil are in the region of 90-180 days worth of total consumption for developed countries.
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