Inflation
Apr 13, 2008 Resources
You might have deduced this yourself, but the WoW economy is almost sure to experience some pretty steep inflation in the months to come. The price of most commodities is likely to steadily rise and it is unclear whether a nearing release of the Wrath of the Lich King expansion pack will have any curbing effect. We will discuss this closer to the release date; for now, we only know it has reached alpha status.
What are the causes of this sudden expected inflation?
- The daily quest limit has been raised to 25 from 10.
- The new daily quests are far easier and less time-consuming.
- Raiding bosses that are on farm status is now significantly profitable with each boss dropping 10g.
- Badges of Justice now drop from all raid bosses, 15 of which can be turned in for Nether Vortices and sold for around 200g. They will later be currency for epic gems which we expect will also be quite valuable (more on this later).
- No added money sinks to counterbalance the above.
Inflation is triggered when more money is present in the economy. The aforementioned points ensure that gold is now easier to come by and thus we expect to see more of it in the World of Warcraft and therefore, expect inflation.
This is more of a warning post than anything else, but how can you protect yourself from an economical standpoint?
- If you expect to be needing a particular gem, enchant, craftable item, etc in the near future, buy the mats asap and hold onto them.
- If you aren’t in need of immediate gold, keep the items you wish to sell for a bit and sell them when the price has risen acceptably.
- Go gank every ally/horde you see at Quel’Danas, hampering their easy daily quest progress and thus reducing the amount of gold that is injected into the WoW economy.
Just kidding about that last one 
Let me add that we have a surprise coming up for you guys in the next week or two, so stay tuned!
April 14th, 2008 at 9:27 am
The single best way to beat inflation is to keep yourself invested. If you have 3500g sitting on your character then that gold does NOTHING for you except lose value as inflation continues. If that same 3500g is invested in good buys that you are using as inventory, then you will be able to resell that inventory at the inflated price. Inventory sitting on the AH for a profit is better than inventory sitting in your bank – but either of those is better than the 3500g just sitting on your character sheet losing value. That’s like burying hundred dollar bills in your backyard. You’re better off burying diamonds that will increase in value over time.
April 14th, 2008 at 12:50 pm
Indeed - an item on the AH for 1 gold beats an item worth 1 gold in your bank beats 1 gold in your pocket. Make your money work for you. I try with my AH alt to spend down to the last gold. Once a week or so I’ll stop and wait for all my inventory to flush through the AH a couple of times to see where I stand, as my gold and inventory are in a very volatile state.
Inflation though is a worry I have - at some point gold will be not worth what it is now. Items will cost more as more people have access to vast funds and as more and more alts get leveled up through content sinks like gems and enchants will start to cost more. I agree with Relmstein when he stated on his blog that Blizzard will probably yank the SSO dailies at some point.
We’ll have to see what happens but for now I’m gathering my 250+ gold/day on my characters as I can.
Roberth, Silver Hand server
April 15th, 2008 at 2:33 pm
This is certainly true. I recently bought 8 primal waters and 5 primal lives for an 81 healing to weapon enchant and blew nearly 400 gold. At least 30g per water and 20 for the lives. The worst part about it is I bought the last few that weren’t going for outrageous prices (5-10g higher). While this may have been a temporary instability, I’m led to believe that this is a simple case of all that extra Daily money being spent on primals for new raid gear enchants.
April 17th, 2008 at 5:53 am
“Badges of Justice now drop from all raid bosses, 15 of which can be turned in for Nether Vortices and sold for around 200g. They will later be currency for epic gems which we expect will also be quite valuable (more on this later).”
That doesn’t increase the amount money in the economy! It would if npcs buy nether for 200g. You are just taking other players money, so no ‘new money’ (or gold).
=)
Yeah, but what should we keep as stock? I like large prismatic shard, ’cause it’s a high demand item, but don’t know how price will change with the new recipe. Primal market is crazy and there is always someone undercutting you. Gem? Maybe, didn’t check the market later. Ore? As gem. Rare epics? Don’t like the idea of having too much money on a item that can take weeks to sell…
April 18th, 2008 at 8:39 am
I’d just been thinking this over. You’re right that the clear best option is to get out of cash and into commodities, but which ones? The inflation isn’t universal, because a whole much of new commodity sources went in with the patch.
Epic gems, nethers, vortexes, and the items containing them would have been good bets, but they are all going to plummet as supply spikes.
My first thought was to stock up on things where we’d see a demand spike, which means the gems and enchanting mats for all the new gear. (Enchanting mats, of course, are nice for the lack of deposit risk.) However, there are complications.
A boatload of crappy greens are entering the supply. Illusion dust will flow like water.
The rare-quality gems are a possibility. Two caveats– demand might go down as more people have access to epic equivalents, and there’s a new source in the form of the Brilliant Glass cooldown.
Large prismatics might be a good idea, except that there will be a new supply of them from the Void Crystal transmute.
Here’s a thought: Void Crystals. The transmute will drive up prices, and new gear needs new enchants.
Some primals might be fine, but I’d stay away from fire. A new daily featuring fast-spawning fire elementals means a supply spike. I’d go with Airs– used in tons of enchants and no new source.
April 19th, 2008 at 8:41 pm
There are two areas that inflation is greatly helpful. Repair costs, and Mounts. Actually any vendor based costs benefit greatly from inflation since their prices are independent of market conditions. So as long as you keep up with inflation to buy raw mats and whatever off the AH, it wont hurt too much, and your repair costs will actually go down, as well as mounts being more affordable.
April 21st, 2008 at 1:54 pm
First time in this web site. Good stuff.
You guys have covered inflation very well, so I am not going to echo it.
Yes, it’s smart to invest some of that gold in goods than have the gold itself. First, hook up your main toon with everything. Epic flying mount, best gear that gold can buy (crafted). If you don’t care about that, then look at what sells in your server.
Someone above mentioned to stay away from primal fire? I beg to differ my friend. In my server, all primals sell like hot cakes. There are floods of primals during weekends and peak hours, but the price go back up again. Primal shadows go from 30g-35g when they used to be like 15g before patch. I rarely see them go down in price because far less people farm them now.
I say check your server and see what you can invest on. Personally, I am not sure what to invest on, maybe people are right….save up your mats for S4? I guess ench mats and gems (raw or uncut). It’s a gamble, nothing is guaranteed…just like irl.
Enjoy
October 15th, 2008 at 12:27 pm
My main is an alchemist/herbalist and I have always found that the herb market is always good. In fact, I make more money in herbs than I do creating potions, etc. However, with the patch last night I have seen a huge spike in the price of even the most basic of plants.
This may be in part to the inscription profession which is rumored to use herbs as well, but I cannot be for certain as I have no experience with the new profession. None-the-less, raw mats in the form of gathered plants has always been lucrative for my character and the market seems to be fairly steady in terms of buy/sell prices.
The situation may not be so for all servers, but I just wanted to toss in my two cents on this matter.
Have a good one!