This morning I consulted the powers beneath and beyond about a good many things, amongst them gold and inflation, and what it portends for us.
What I wanted to understand was the impact of recent developments such as the casualization of, and greater activity in, raiding; cheaper gems, enchants, and consumables due to facilitated production; and the increased abundance of botting and terrain hack mining. Despite the highly negative connotation of the lattermost, and whatever my opinion may be about the former two, it's not my intention to group these three developments together in any sense other than their economic effects.
Now, the immediate effects of all this: greater supply of, and lower prices for, gems, enchants, and primary materials such as herbs and ore.
While it could be argued that there is a greater demand for gems and enchants, due to the increased number of people with high-end gear, in practice, that hasn't happened at all; gems and enchants and ore and consumables are all much cheaper now in both absolute and relative terms than during TBC and even much of vanilla. This is a generalization, but it is correct more often than not.
So what we want to know is, what's the impact?
Players who seek only to provide for their consumables on a going concern find their efforts trivialized; it is easier than ever before to gem and enchant gear. While some players still are "hand to mouth", by and large more players than ever are turning a surplus. And so many players have increasingly large amounts of gold.
Now, the more pernicious side of this, that I really want to look at, is the high end. While we've experienced deflation at the low end - gold buys more items low on the hierarchy of wants/needs - at the high end has been monstrous inflation.
Since there are insufficient gold sinks, and consumables are cheap, items that are fully elastic in value, such as BoEs, novelty items, and services (i.e., crafting, achievement/drake sales and rating boosts), in going for whatever the market is willing to pay, have seen disproportionate inflation - the loose currency, people's disposable income, flows that way. Today we routinely talk in terms of selling something for a six-digit figure.
I also want to coolly and frankly analyze the effects of botting. First and most obviously, it disenfranchises legitimate farming. Like free workers put out of work by slave labor or automation, they must now either mill about, with no good revenue stream, or work in the service industry, and manage a decent standard of living despite being less productive, because of the cheaper production. In practice this means more arbitrage/speculation (playing the AH), or simply accepting a lower "standard of living". While they can definitely take on a new profession, in general, professions are less profitable than before due to lack of exclusiveness or ability to sell the big-ticket items. This is destructive for reasons I'll explain later.
Second, it advances the destruction of the middle class: low-end consumables are cheap, but both botters and people who buy their products at the AH have greater and greater gold surpluses, causing the top end to become ever-more inflated as we see this ongoing deflation at the low end.
The effect of all this is to widen the base of the pyramid and narrow the top. This is so because unless you are in a position to sell these infinitely elastic things - novelty items, services, or the like - farming will not prove particularly lucrative, because of how little low-end products that were formerly reasonably profitable such as gems and ore and the like are now worth. While arbitrage and speculation are as profitable as ever, gem farmers and legitimate miners and flask makers and enchanters have seen tremendous diminution in their livelihoods. Taking a step back, it is far harder than ever before to buy a big-ticket, infinitely elastic item, but easier than ever before to pay for small things. You could farm your way to T1 or Spellstrike in vanilla or TBC much more easily than a 264 piece in the present day, with saronite bars at 40g a stack, flasks at 300g a stack, gems at 2000g a stack - and 264 gear at 5-12k per piece.
The longer term effect, that I really want to call attention to, is how dangerously this bodes for the community. On the one hand, we have the diminution of the social middle class - and by this I mean raiders - and now we have no real middle ground between hardcore raiders and Saurfang zergers. On the other, is how speculation, botting, and sales of services are becoming increasingly overpowered as revenue streams as compared to simple farming. The net effect will be a disjointed and disaffected community with a lack of mobility or self-empowerment.
Now, in terms of action, I feel several things ought to be done:
-Botting is destructive on many levels and must be cracked down on.
-Consumables, including item enhancements and crafted gear, while they should not be as expensive as they were in previous expansions, should probably be more expensive than they are now.
-There must be more high end gold sinks. The Traveler's Mammoth costs 16,800g, but I think that in this expansion it would be a positive development for there to be a big-ticket item of some sort, purchasable from a vendor, that sells for six digits.
-The devs should consider introducing some sort of infinitely elastic item from a vendor. By that I mean something like a world event NPC doing a silent auction of an amazing novelty (perhaps randomly selected) on a predictable timer, once a week or so - essentially the economic equivalent of a world boss.
The effect of all this would be to widen the middle class without making consumables and gems either exorbitant or so trivial that they are nothing more than a nuisance to buy off the AH; that there is no gratification in purchasing them.
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