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In regards to "Manipulation Monday #3: Thanks to Kyla!"

If you read my Item vs BDA thread i begin to write about how it will be more fruitful to almost never sell on the RHAM and only buy from it when opportunity arises. I went into a detailed analytical forecast on what the blizzard posting fee's will be and also showed the "2.9%+\$0.30" paypal charges for receiving payments.

Applying my analysis to his/her idea he will lose a substantial percentage to just the fee's associated with turning his gold into cash. the only reason to do this in the beginning of the game is if you think that the \$ will appreciate substantially within a short period of time. However turning 5000g into \$1.50 = 1000g = \$0.30 then take the estimated 2.9%+\$0.35(.30 from PP and .05 from blizz) your looking at a charge of \$.05+\$.35= \$0.40 on your 1.50 which is a 26% loss in the conversion. however if you sell 50,000g for \$10.50 you are looking at a \$.30+\$.35= \$.65 which is a 6% loss on conversion which would require you to be able to purchase at least an extra 3,000g with the initial \$10.50 totaling 53,000g just to break even.

At 500,000g for \$105 your looking at a charge of \$3+.35=\$3.35 which is 3.19% loss on conversion. and In turn would require a 3% appreciation of the \$ against gold for you to make money.

So in short, Volume will be a huge factor when converting GLD to USD.

However as i said in my other thread using funds to purchase end game crafting mats will be the best way to preserve the initial value of your gold for the long term.(provided no new end game mats are added)

THAT BEING SAID, HERE IS MY ENTRY FOR MADOFF/MANIPULATION MONDAY

Set Up:
It requires at least two people. First you identify an item that is "rare" and has a decent demand relative to volume in the AH. You then purchase several of these items to create an inventory. This is one of the most impotant steps, the item that you chose to do this with must be perceived as a good important item to have that does not have a similar item in the same price range, this should most likely be done with a Staple item, as i spoke about in Identifying Profit

Manipulation:
Now lets say the item is selling for 5000g, i want to create the perception in the AH that this item is worth 10000g. I will then post 1 of these items at 10,001g and my partner post and undercut me buy 1g. we will go back and forth, I will purchase his item and he will purchase mine we will rinse and repeat until the market perception begins to change. People are greedy and when they happen to come across the item we are doing this with they will see it is "selling for 10,000g" and will price their item for probably 9,000-9,500.
When this happens we have just raised the "perceptual value" of the item.

Profit:
Now doing this back and forth we may have spent 2000g on AH fees between the both of us. However we purchased 10 of these items each at 5000g now we begin to sell them in a range from 8000g-9500g that is a profit of 37-47% minus a small percentage on additional AH fees. So in total that's an initial investment of 50,000g eventually turning into 68,000g - 73,000g minus the 2000g to manipulate that's leaves you with 66,000 - 71,000g after putting in only 50,000g.

Now obviously in practice it can work out very differently, if you chose an item that isn't rare enough then the supply will be constant and you wont be able to change perceived value.

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I have a feeling most of the people that are making these suggestions for market manipulation, have had only marginal dealings with the Diablo 2 trade market, and by that I don't mean trading for fg or as I call it fake gold on d2jsp.

I call it the “Training Thief”. From what we’ve seen in beta, pages of training are the bottleneck in training your artisans. So manipulating their flow may be profitable! Only works in the first few days of the game. You convert some real life money into gold, and go buy up all the Pages of Training in the Gold AH. Eventually, as many new gold-rich players come into the game looking to spend on training their artisans, you sell the BOOKS of training (by combining the pages) in the RMAH for real money, or in the gold AH for gold at a 20% profit margin. Remember, no one will be listing any pages of training on the RMAH because there not worth enough. Books however, may cost a tiny bit of Real money. By limiting the progression of players, you hold a lot of power.
Ok, so this is an example of a time limited manipulation because in the long run it's doomed to fail, so the only way to profit from it is to be first in and first out.

The first problem I see with it is the fact that from what I've seen in the beta streams the Pages of Training drop quite often, which means Tomes of Training will be common so it will be next to impossible to corner the market on it, but even if somebody manages it I doubt there will be enough demand for him/her to divest all the Tomes at a profit before the market crashes on their value, which is something we already establish will happen. It's very likely that the trader in question will get crushed by the plunging value of the Tomes and he'll end up selling them for peanuts, if at all, but that won't be as much of a problem since they weren't that valuable to begin with. The trader should be happy if he manages to get out of this not losing money, but even if in the end there is a small profit, it certainly won't be enough to make up for the countless hours spent on trying to control such an open market like Tomes of Training.

Manipulation #2, I'm not going to quote it since it's way to long
This is an example of a strategy to corner the market on an item of high value, there are several problems with it:

1. The biggest one is that it's risky like all hell, you're betting real money that you can control the market where you are just one guy out of millions.

2. The basic principal of the strategy is that the trader buys all the Windforces on the market and resells a few of them at a much higher cost in the hope of changing the perceived market value of the Windforce, which given enough initial starting money might be possible, the problem starts when he says that if another Windforce enters the AH at a significant lower price, but presumably higher than when he started buying the Windforces, he will buy that one too right away before other traders on the market see it and are influenced by it creating a resistance to the inflation of the value of the Windforce. The problem is that he almost certainly won't be able to buy it, at least not right away, to buy it right away he would need to use the buyout option, which if active at all, almost certainly will, or at least should, be set higher than anything even out intrepid investor would be willing to pay, as such he will have to just get in line and bid on the item just like anyone else. So now he has 2 choices, either he starts bidding as low as possible but enough to be top bid, which in turn will work against his need to inflate the price of the Windforce, or strongly outbid anyone else, in which case he will have to pay a much higher price for the item as such reducing any possible profit he would get from selling it, if he manages to get a profit at all.

3. Another problem with high end items is ironically that they are high end and high priced, which makes the pool of potential buyers small, but not only that it also means they are informed as such much harder to manipulate than low end traders. While yes it is possible that a 13 year old kid is playing with daddy's credit card and has no idea what he's doing what he's buying and how much they are worth, that won't be the majority, or even a sizable minority.

My idea is a very basic one that I expect many people are probably going to attempt to do. The idea centers around buying and selling gold, and reselling it at higher rates to make a profit.

At the beginning, gold is going to be very expensive (in my opinion). I plan to sell every ounce of gold I make for real money in the first few weeks of the game. After a few weeks/months, on every price-dip I plan to use that money to repurchase the gold at a discount. I will then use this gold to purchase high-end salvaging materials just before the majority of players hit level 60, when I expect the demand for materials to surge due to people using it extensively at level 60. I will then resell these goods afterwards, when Salvaging materials are in huge demand.

So my idea is a bit of a “train-effect”, where you buy what you think is going to surge in advance, and then change your strategy to the next item in line. You can do this by predicting how you think people will spend their money. In my example above, I predict people will want gold to begin with, and then when they hit level 60 they will want salvaging materials.
This manipulation isn't so much a manipulation as it's wishful thinking and cluelessness.

First thing that is almost certainly wrong is that gold will have a high value of weeks/months. I'm willing to bet that by the end of the first week the gold market will crash, players will play almost constantly for the first week and they will pick up and sell pretty much anything, that will lead to a huge amount of gold being generated, by the end of day one I expect most players to have at least 100k gold and this is a conservative number, it could easily be much higher and almost certainly not lower, by the end of day 2 players should break the 1 million gold mark without issue and this will only incress as the days go by. With such a large amount of gold being generated, no matter what gold sinks Blizzard thinks they are implementing, it almost certainly won't be enough and by the end of the first week, at the latest, the gold market will crash under its own weight.

A second problem with this idea is that the poster thinks it will take weeks/months for most of the players to reach level 60, this will almost certainly not be so, even the laziest of D3 players won't take more than 2 weeks to reach level 60.

Third problem is that it assumes a huge surge of demand for crafted resources, I've looked at the crafting recipes and I'm not at all feeling the love, sure some are good and if no unique/rare item drops that are better will be used, but I don't see the huge surge, but that won't be a problem since if you try this entire trade you wouldn't have made enough money in phase one to corner the market in phase two anyway.

Set Up:
It requires at least two people. First you identify an item that is "rare" and has a decent demand relative to volume in the AH. You then purchase several of these items to create an inventory. This is one of the most impotant steps, the item that you chose to do this with must be perceived as a good important item to have that does not have a similar item in the same price range, this should most likely be done with a Staple item, as i spoke about in Identifying Profit

Manipulation:
Now lets say the item is selling for 5000g, i want to create the perception in the AH that this item is worth 10000g. I will then post 1 of these items at 10,001g and my partner post and undercut me buy 1g. we will go back and forth, I will purchase his item and he will purchase mine we will rinse and repeat until the market perception begins to change. People are greedy and when they happen to come across the item we are doing this with they will see it is "selling for 10,000g" and will price their item for probably 9,000-9,500.
When this happens we have just raised the "perceptual value" of the item.

Profit:
Now doing this back and forth we may have spent 2000g on AH fees between the both of us. However we purchased 10 of these items each at 5000g now we begin to sell them in a range from 8000g-9500g that is a profit of 37-47% minus a small percentage on additional AH fees. So in total that's an initial investment of 50,000g eventually turning into 68,000g - 73,000g minus the 2000g to manipulate that's leaves you with 66,000 - 71,000g after putting in only 50,000g.
Funny enough 2 guys tried to use this exact scam on me back when I was still playing D2, well I shouldn't say on me, they were pasting the buy/sell messages at alternate times on the trade channel in the hope that somebody saw both and couldn't add 2+2 and get 4.

The problem with this manipulation is that it requires an item so specific it makes it its own downfall, first the item must have a significant value, but at the same time that value must not be well defined, which actually rules out Staple items like the poster above me suggests, because everybody knows how much a Staple item is worth, think for Diablo 2, you wouldn't try this manipulation with Shakos or Storms, no those items are too well known as such your ability to bend the perceived value of the item is hampered. As such you are only left with speciality items, but those have problems too, only some people will trade/have use for them and if you trade them you probably know what they are worth or at least have a rough estimate which again hampers your ability to manipulate the market.

So in closing the issue with this is that not only to do need to pick the exact right items, because only a few items will be vulnerable to this kind of manipulation and ironically that's another reason the ability to profit will be reduced, since the item in question is so rare the chance that you'll be able to buy at least 10 of them at a price where you can make a profit is actually quite low.

3. 0

In regards to the manipulation i suggested. (Which I have done in WoW with some success with a larger group of people it took 5 of us pushing up the prices across several mats to make the the item created from those mats worth more, but still less then the next tier item. Also the time frame is when people are starting to be aware of staple items but there still isn't a clear price associated with the item. Also This item doesn't have to be "So" rare, just rare enough that their aren't 20 on the AH at the same time. that's why item identification would be the most important part. but this was more for fun then actually trying to make mucho dinero)

Please don't regard my post as me thinking is some perfect major idea. this thread isn't supposed to be ideas that are completely thought out and bullet proof, just more like a fun exercise. And if i ever had an idea for a manipulation of the caliber to make me real money i would never be posting it period.

However your right, to be honest other then scamming people (which i think was your interpretation of my manipulation; but realize this isn't trying to scam a few people in trade chat, it is fundamentally changing the public's price expectation for the item.) any truly profitable market manipulation would have to be done in such a large scale that it would really be more adventitious to just do something else.

So here's another idea for a manipulation:

Guide to Finding Riches in Diablo 3 and Make REAL MONEY!!
Only \$10.99 for the first 200 orders
[you are customer 190! hurry and order while they last]

]Secured by Verisign
Accept Paypal Visa Mastercard Discover

4. 0

"How to make money selling a book for \$29.99." Cost \$29.99

SNL or In Living Color did that skit a few years back.

5. 0

Originally Posted by Naviaras
"How to make money selling a book for \$29.99." Cost \$29.99

SNL or In Living Color did that skit a few years back.

TBH doing something like that is prob the best time/profit you could do. wether its good info or crap you take a few hours, make a pdf. pay for the domain and hosting like \$10 bucks. have gullible people buy it for \$20 or whatever, as long as you can sell a few who cares.

But i definitely believe that a well written comprehensive ebook could make some cash, yea it'll be downloadable from some place else in 2 secs but who cares it still generates cash flow lol. I used to look at the traffic some of those gold guide sites for WoW got, it was impressive.

6. 0

I was in this kind of business for a while, so Im kind of an insider. When I first started, I was like you. Thinking that this stuff wont make that much money. However, the reality is that these wow gold guides are all from the same group of people and its a million dollar business. It costs them next to nothing, as soon as you have the google rankings locked in on something that people are willing to spend money on, its as if you were printing money.

Of course, the guides pop up on the web for some people to download, as happens with any virtual good. But the point is that thats a very small minority group of people. You guys as educated users of the internet wouldnt believe how many people think that the internet consists of google and maybe facebook. And the only way to access facebook is to enter "facebook" as a query in google.

Guides on Diablo 3 will pop up. Its not a question of if but of when. And I know people who are already working on it. There are coaching sites for starcraft 2. It takes the better part of an afternoon to create such a product and then you can sell it for years. There are sophisticated systems for everyone. Theres a site that you can put your virtual product on for a one-time fee of 50 bucks and they do everything for you. The billing, the chargebacks, the legal, the joint ventures. All you have to do is promote your product any way you like.

And the guys at the top of game? There are about 2 dozen. They have emailing lists with tens of millions of subscribers and every time one of them releases a product everyone else mails it out to their lists and every product launch that they have has a 5 million dollar target and that has close to never failed.

Diablo 3 guides will happen. And if you are serious about this and have some kind of insight, maybe you should consider writing it up. You dont even have to do all the marketing, if you just want to create the guide and not be the one to promote it, there are people who buy that for a couple hundred bucks. Seriously.

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8. 0

The way i see it i predict that gems will fight inflation much better than low tier items, in-game gold or crafting mats. I'm tempted to sell everything else and then buy and hoard gems, but there is the risk that you get left behind in development.

It's very valid concern that if you ignore the game progress and focus too much on the economy you might get left behind on the progress curve. By the time you have hoarded 5 gems the guy rushing trough the content have looted two second tier gems.

It will probably boil down to early game hours. If one can afford to play a lot early on then rushing trough content will be the more profitable way, but if i'm busy doing something else than playing i will probably try to sell everything early on and invest on the commodity that i believe will hold it's value best. At the moment i would say that will be gems.

9. 0

I'm thinking you should switch the name of this to manipulation monthly to save your sanity Azzure

At least until the game is released.

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