Monthly Archives: May 2010

People often chat to me about their gold making techniques and experiences. From time to time I see the phrase ‘controlling the market’ used and it bothers me. The economically uninitiated throw it around freely and for them it’s all about ego ego ego.

“You keep using that word. I do not think it means what you think it means.” -Inigo Montoya, The Princess Bride

If you’re the single person on your server with an ultra-rare recipe then you’re definitely entitled to say you ‘control’ the market. Similarly if you’re supplying a large majority (ie 90% plus) of a high demand item you may also be able to make that claim.

In reality, though, how often do you think that’s the case? It’d be a very rare occurrence these days, I can tell you that. I know that even the items I profit from most regularly I don’t have any sort of monopoly on.

There’s a big difference between controlling a market and identifying a market with reasonable demand and low supplier participation rates.

The above is a simple diagram I put together to help demonstrate my point. Unless you can control supply you can’t control the market. At the very best if you’re buying out everything in the Auction House you can temporarily set a higher price. That is until additional suppliers come along of course.

If the resupply rate is sufficiently low and there’s demand then you can make a profit this way. Although, again, most of the time I see people bragging about this it’s been for foolish high-supply materials.

I fondly remember, some years back, getting a hate whisper from someone after I’d posted a bunch of Greater Eternal Essences on the AH. The person abused me and told me I was setting my auctions too low. I responded and said something like “I set them at what I felt was an appropriate price, buy them if you think they’re too low”.

Totally misunderstanding what I’d said, the person assumed that in saying the word “set” I meant I’d “set” the market price. Boy was he hopping mad at that – “YOU SET THE PRICE? I’ve been controlling the market and setting the price for weeks!” he exclaimed. Wrong wrong wrong!

Clearly because he did not control the supply he did not control the market. Some random person was able to come along and unknowingly upset his imaginary little tea party.

So next time before you throw about the term ‘Controlling the market’ maybe have a think about it. Is it really the best way to describe what you’re doing or is perhaps “Minor manipulation through focused and regular intervention” more apt? actually…never mind me :p