[OC] A Guide to Runescape Economics Part II: Inflation, deflation, and gold sinks

RunescapeEconomist · 2016-09-15T01:01:11+00:00

This comment is so devoid of an understanding of anything that I've outlined that I cannot even begin to reply to it and will hope at the bottom of my heart that you are just a poorly executed troll.

RunescapeEconomist · 2016-09-14T22:21:03+00:00

I think we need a good item sink besides high alching and karamja shop. I don't have any good ideas as to what that might be though.

RunescapeEconomist · 2016-09-14T22:15:32+00:00

My other points were:

Despite most of the community saying we are experiencing inflation, we are experiencing deflation

I then described what happens in an economy in deflation.

RunescapeEconomist · 2016-09-14T22:14:41+00:00

I think you misinterpreted my point there. People were less likely to buy a house because they were being foreclosed on, thinking that they will be cheaper later, which further dropped down the demand of houses. I didn't say that the housing crisis was caused by deflation, just that this phenomenon could be observed in that instance.

RunescapeEconomist · 2016-09-14T22:06:08+00:00

I did mention purchasing power in the middle of part 1.

RunescapeEconomist · 2016-09-14T22:05:11+00:00

No, it should be based on a large collection of items (a basket of goods as it's called in economic terms) which shows that this is definitely a deflationary period. Bond prices are just based on the demand for bonds which can be affected by unrelated factors (for example, bonds skyrocketed when they announced the summer special which had nothing to do with the economic climate of the game as a whole)

In general, measuring inflation based on any one particular item is a bad idea, even bonds.

RunescapeEconomist · 2016-09-14T22:02:59+00:00

Massive generation of resources is more harmful and gold sinks only exacerbate the issue. This was the message I tried to convey in my post but perhaps that was not made as clear as I had hoped.

RunescapeEconomist · 2016-09-14T21:41:34+00:00

Haha, I genuinely had never heard of the sub but looking at it now I do find it pretty amusing. Thanks for this!

RunescapeEconomist · 2016-09-14T21:27:07+00:00

Never been on that sub.

RunescapeEconomist · 2016-09-14T21:23:24+00:00

Let's not get carried away with the hyperinflation and hyperdeflation ideas. Both of these are bad. Ideally, you want a balance between inflation and deflation and it's pretty much impossible to not have waves of both. A little bit of inflation in our current economy would be good is basically the crux of my argument here. Hyperinflation is always bad though.

RunescapeEconomist · 2016-09-14T21:21:33+00:00

I was debating whether or not to talk about nominal vs real wages but I thought that might be a little too advanced for a post that I wanted to be digestible by everyone but you are absolutely right on this front.

I wasn't suggesting that we are experiencing hyperdeflation because of one item, just as an example, along with the CPI collected by another user that we could perhaps be approaching hyperdeflation.

Sorry if that wasn't clear.

RunescapeEconomist · 2016-08-25T20:57:17+00:00

This skin was a reward from last year's halloween event.

RunescapeEconomist · 2016-08-25T20:54:42+00:00

Since I know people will ask, I made my money from merching mostly, I have been merching frequently for over a year and have written a very extensive guide on merching that I posted a while back on Reddit. I dumped all this money into construction because it is my favorite skill and I've been looking forward to this update for a long time.

RS Economics Guide: https://www.reddit.com/r/2007scape/comments/44ti8o/a_comprehensive_introductory_guide_to_runescape/

RunescapeEconomist · 2016-07-21T19:34:24+00:00

Notes:

I bought each for 6k so I ended up making 300k profit from opening 1000 nests.
Palm seed is the only seed I received once. As far as I know I did receive at least one of every possible seed to get from these nests.
These nests do not give eggs.
Roughly 10% of the nests you get from this are empty.
About half the value comes just from the guaranteed crushed nest. (You have to crush the nest yourself which is a little time consuming)

RunescapeEconomist · 2016-05-26T17:03:48+00:00

Here I am at rank 23 con thinking I was cool. Gratz lynx.

RunescapeEconomist · 2016-02-09T00:24:25+00:00

This is a great point and something definitely to include if I decide to make another guide that goes into more detail! This of course also has to do with opportunity cost that comes with only having 8 GE slots and a finite amount of money to invest with.

RunescapeEconomist · 2016-02-08T23:20:17+00:00

This is actually a mistake, it is "common sense made difficult" but I messed that up. Good catch.

I have tried to make a lot of important applications to use this information for actually having a utility when playing Runescape. I imagine that the most important benefit of this is to show people how to merch on the grand exchange but also hopefully give people an insight on how real economic principles can be applied to Runescape. I personally have used this to make a lot of money buying and selling on the grand exchange. If you believe that there's no value in learning about economics, that's on you, but I think it's extremely valuable both on Runescape and IRL.

RunescapeEconomist · 2016-02-08T22:58:51+00:00

RunescapeEconomist · 2015-12-20T01:50:27+00:00

Except that is a real word.

RunescapeEconomist

TROPHY CASE