DeletedUser9184
Supply and demand. That's all I have to say 
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"Fair Trades" Explanation?
- Thread starter planetofthehumans2
- Start date
DeletedUser6172
The requirement for unrefined goods is just a sneaky way of requiring a larger footprint for the PAIR (triple in TE) of manufacturing buildings that's needed for the refined goods, and the space requirements increase right along with the per cycle coins and supplies increases.
The CRITICAL question is if the other costs CORRELATE with the per cycle coins. OF COURSE there are a great many minor variances and a significant ONE-TIME cost for a new manufacturing building BUT unless those costs rise at a rate that's DIFFERENT THAN the per cycle coins (once you've converted the unrefined goods into equivalent coins) then the start-up costs won't effect relative value at all so there's no need to fiddle with depreciation. A simple model that just looks at the cost of coins per cycle is entirely sufficient to establish relative values.
The advantage of a Like Value trading policy, is that it promotes an efficient market. With a Like Value trading policy it doesn't matter who builds what, because the value of your inventory is based on coins in any case, not on slick trades and market manipulation.
That said, I did propose a Dutch Auction House Great Building, at
http://forum.us.forgeofempires.com/...-House-Great-Building&highlight=Dutch+Auction
and didn't even get any comments, so folks aren't really interested in a true auction capability to establish relative values, they just want to minimize the short-term hassles associated with trading, and probably don't even understand the the long term risks of unpredictable inventory asset values.
We have a very small, very predictable market, and it would be extremely easy for a slick trader to corner the market, and then charge premium prices for the goods that folks need to complete their tech tree.
The CRITICAL question is if the other costs CORRELATE with the per cycle coins. OF COURSE there are a great many minor variances and a significant ONE-TIME cost for a new manufacturing building BUT unless those costs rise at a rate that's DIFFERENT THAN the per cycle coins (once you've converted the unrefined goods into equivalent coins) then the start-up costs won't effect relative value at all so there's no need to fiddle with depreciation. A simple model that just looks at the cost of coins per cycle is entirely sufficient to establish relative values.
The advantage of a Like Value trading policy, is that it promotes an efficient market. With a Like Value trading policy it doesn't matter who builds what, because the value of your inventory is based on coins in any case, not on slick trades and market manipulation.
That said, I did propose a Dutch Auction House Great Building, at
http://forum.us.forgeofempires.com/...-House-Great-Building&highlight=Dutch+Auction
and didn't even get any comments, so folks aren't really interested in a true auction capability to establish relative values, they just want to minimize the short-term hassles associated with trading, and probably don't even understand the the long term risks of unpredictable inventory asset values.
We have a very small, very predictable market, and it would be extremely easy for a slick trader to corner the market, and then charge premium prices for the goods that folks need to complete their tech tree.
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DeletedUser8428
Planet, I am ALWAYS confused by the mathematicians posts about fair trade, particularly in the higher ages. The truth is, Inno has no rules about Fair Trade - there are "rules" that have become accepted through game play. Visiting the forums you'll find calculators and explanations and plenty of people to tell you what's fair. But those are all just opinions.
Guilds who have a Fair Trade policy decide for themselves what that means and guild members abide by those guidelines. But they don't necessarily adopt the same trade rules, and solo players decide for themselves what's fair.
DeletedUser14354
The fundamental problem with most of these "mathematical" proofs is that they focus on coins and supplies. The true "currency" of this game is time. It requires time to produce the coins and supplies that go into producing a good, plus it takes time to produce the good itself. Moreover, as you progress in the game, it takes proportionately less time to produce the same number of coins or supplies.
Moreover, everyone's city is structured differently, meaning they can produce proportionately more or less coins in the same time, more or less supplies, more or less goods, etc. These comparative advantages are key for any calculation of "fair trade", and would mean that any truly "fair" exchange would be determined by the specific characteristics of the parties involved, and would not necessarily be the same for other parties. Economists have recognized this since the publication of Ricardo's theory of comparative advantage.
In other words, the issue of what is "fair" is a red herring. Guilds determine trade ratios in order to promote "orderly" trade. In other words, the policy is designed to promote liquidity, not equity. Same as any exchange in the real world.
Moreover, everyone's city is structured differently, meaning they can produce proportionately more or less coins in the same time, more or less supplies, more or less goods, etc. These comparative advantages are key for any calculation of "fair trade", and would mean that any truly "fair" exchange would be determined by the specific characteristics of the parties involved, and would not necessarily be the same for other parties. Economists have recognized this since the publication of Ricardo's theory of comparative advantage.
In other words, the issue of what is "fair" is a red herring. Guilds determine trade ratios in order to promote "orderly" trade. In other words, the policy is designed to promote liquidity, not equity. Same as any exchange in the real world.
DeletedUser6172
Which is exactly why MORE coins and supplies are required, for similar things, as a city progresses.
There's another factor as well, although you can bury it in liquidity, and that's crime prevention. More specifically, there needs to be some basis for booting a guild member who is cornering the market and then jacking up the prices.
Trading is by no means the most complex of our minigames, and guild policy is that we want trades to be value neutral so that we can quickly and conveniently exchange goods without any need to worry about gaining or losing inventory value.
Most folks rather quickly agree that asking for free stuff is unfair, but it’s less obvious why offering free stuff is also unfair. Let's consider a typical scenario:
* NiceNancy has scraped together enough Brass to buy the Coffee that she needs to advance her research. She posts the following trade:
Brass 30 gets her Coffee 20, which is a Like Value 3:2 trade
* SloppyJoe doesn't even notice NiceNancy's trade when he posts a similar trade.
Brass 40 gets him Coffee 20, which is NOT a Like Value 3:2 trade
- He's probably just being sloppy, and posted a 2:1 trade without thinking
- He might be “sweetening the pot” because he has way too much Brass
- He might have cornered the Coffee supply,
so nobody can actually buy HIS cheap Brass,
but if somebody else posts an identical trade, he’ll jump on THEIR cheap Brass.
If you think we’re kidding, please go read http://en.wikipedia.org/wiki/Deadweight_loss. We have a very small market wherein the bottlenecks are entirely predictable. If we allowed folks to manipulate inventory values, it would be very tempting, and dead easy, for a sharp operator to create an artificial shortage and then rake in the profits by charging whatever the market will bear. And a sharp operator WILL NOT be obvious about manipulating market values. A little bit here, a little bit there, and pretty soon everybody will think that it’s normal to pay premium prices for everything.
Everybody else in the guild will suffer except for SloppyJoe, who is sitting on 4000 Coffee (although we can’t actually prove it) and is making out like a bandit by “doing everybody a favor” and filling their orders, so long as they’re willing to pay premium prices. Market manipulation is very difficult to prove, but it’s very easy to prevent. We therefore require that ALL trades, other than upside down charity trades with twice as many expensive goods as cheap goods, be posted with Like Value for Like Value.
We can't discern SloppyJoe’s intent just by looking at the posted trades, but in all cases SloppyJoe’s unfair trades are blocking NiceNancy's trades, because he's offering MORE than the Coffee is worth, for whatever reason.
* SloppyJoe then offers some Coffee for the Coke that he needs.
Coffee 20 gets him Coke 15 which is a Like Value 4:3 trade
* MeanMaud posts an unfair trade.
Coffee 30 gets her Coke 15 which is NOT a Like Value 4:3 trade
blah, blah, blah, all of the same excuses that SloppyJoe used earlier.
But now SloopyJoe is all pissy because he can't get the Coke that he needs for a fair price. It serves him right, and maybe NOW he'll understand why we have a Like Value trading policy.
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DeletedUser10076
The fair trade calculator is what EVERYONE should be using.
Basing trades on coin/supply needed is simply put the best way for determining if a trade is fair.
1. If you do 2:1 in all ages 10 CE, becomes 20 PME, becomes 40 ME, etc. you have gained a huge difference in coin and supplies taken which would increase exponentially if you continue to trade down.
2. The amount and range of goods needed increase greatly through out the tech tree. PE still has a couple of techs which require CA goods. Being able to trade PE for CA allows a greater fluidity. The PE player doesn't have to waste space producing CA goods, and the CA player can begin to stockpile PE goods, which they can use whatevers.
3. The argument that nobody takes into account room/two lanes is weak.
-do you want to do the calculations for such a method?
-using this some goods would be absolutely worthless, took me months to rid of paper stock anyways nobody wants it under the current system.
Basing trades on coin/supply needed is simply put the best way for determining if a trade is fair.
1. If you do 2:1 in all ages 10 CE, becomes 20 PME, becomes 40 ME, etc. you have gained a huge difference in coin and supplies taken which would increase exponentially if you continue to trade down.
2. The amount and range of goods needed increase greatly through out the tech tree. PE still has a couple of techs which require CA goods. Being able to trade PE for CA allows a greater fluidity. The PE player doesn't have to waste space producing CA goods, and the CA player can begin to stockpile PE goods, which they can use whatevers.
3. The argument that nobody takes into account room/two lanes is weak.
-do you want to do the calculations for such a method?
-using this some goods would be absolutely worthless, took me months to rid of paper stock anyways nobody wants it under the current system.
DeletedUser8152
The free trade theory would be that you let the market take care of it.
I think that's the major idea in support of a free trade approach. It is easier to make paper than porcelain, so why not let porcelain be more valuable?
There's a down side of course, in terms of liquidity. But there's an up side in terms of efficiency. I think its up to individual guilds what they want to do. But I would argue that basing it on the coin/supply cost is just a convenient way to make a more liquid system, not an objectively better one. Any system that everyone agrees on should work.
DeletedUser8861
The debate over what is "fair" trade will be debated as long as this game is in existence...it is an issue that has caused people to leave guilds and harass other players as everyone has a differing opinion on this issue.
To make a firm statement, "The fair trade calculator is what EVERYONE should be using" which is your personal opinion, helps no one. As why would your personal opinion hold any more weight than mine? I could just as easily say 2-1, 1-1, 1-2 are the ONLY trades that should be made, doesn't mean it is going to happen...it is again my opinion.
The difference is if I happen to run a guild (which I do), and my council adopts the 2-1, 1-1, 1-2 policy (which they did)...then that is the law of the land for my guild. We have tried to be fair and have told folks we have no problem if you want to do trades that are outside of the policy as long as you prearrange them, and they don't sit on the board for more than an hour.
I have played FOE on many worlds (across a number of different countries) and find this issue is one of the most debated anywhere I go. The bottom line is Forge of Empires has provided some basic parameters for trading, beyond that whether you chose to make trades or not, is entirely your choice. Guilds can chose to enforce whatever policy they want as long as it fits within the automatic guidelines set in the game.
DeletedUser8152
I do think there would be a lot less friction if you could mark trades for hood and friends, and not just guild only. I hope they implement that at some point.
DeletedUser10554
I though that was already in place, outside of the guild you pay 1 fp to make the trade, free when done with guild members?
Maybe I am missing something relating to fair trades. I alway trade goods 1 for 1 and use the tech level of the goods as the ruler. I will use upper level goods to get goods for a lower level needed, 1 for 1 there also.
Rhetorical question, someone cornering the market, how is that possible?
I thought everyone could get all the goods. However production output varies from acquiring raw supplies won on the continent map.
The understanding I operate on as of now is as follows. Everyone has the ability to produce all goods for the game. The amount of the goods produced varies from player too player.
Setting the stage for the necessity of the trading do I have this correct?
DeletedUser9184
Jaelis was suggesting (another) option for trade to be only visible to neighbors/friends, so the guild members wouldn't see your offer.
DeletedUser8152
Like byeordie said, this would be a new thing where you could restrict your trade to (say) hoodies only.
Maybe I am missing something relating to fair trades. I alway trade goods 1 for 1 and use the tech level of the goods as the ruler. I will use upper level goods to get goods for a lower level needed, 1 for 1 there also.
I don't believe it really is, though Kat will disagree
Yes, but unboosted output is so inefficient that you'll essentially always be better off trading for unboosted goods, even at outrageous terms. I'd rather trade 2 HMA goods for 1 EMA good than to just produce the unboosted EMA good.
Nonetheless, I don't think cornering the market works because around 40% of the players will be boosted in an given good (at least). I don't think even a small cartel of players could have enough purchasing power to take up all that production. Perhaps you could corner the market in your guild when you don't have a lot of players in an age, but people can trade with their friends and hoodies, the fp cost is not so bad. And if it's becomes clear you're hording goods and not helping your guild, then they should kick you out.
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DeletedUser6172
Cornering the market is dead easy. Let's take Paper as an example, so that we're not in any danger of someone actually abusing the concept.
- I'll corner the Paper market by instantly buying all of the reasonably priced paper that's offered in my Guild, Neighborhood, and Friends list.
- I'll post FAKE premium offers of
150 Coffee/Wire/Porcelain/Tar gets me 100 Paper - They're fake premium offers because nobody else HAS 100 Paper to cover the trades, because I'm the only trader with any Paper inventory.
- If somebody actually NEEDS paper I'll only respond if they MATCH my fake price.
150 Coffee/Wire/Porcelain/Tar gets THEM 100 Paper - I'm the only trader who HAS any Paper, so I can charge whatever the market will bear. I've just turned a nice easy 50% profit because I've cornered the Paper market, and everybody who actually NEEDS Paper now has to offer me a premium price to get any Paper.
The IMPORTANT POINT is that Sloppy Joe IS offering premium prices, and APPEARS to be doing everybody a big favor because he's providing all of the paper that everybody needs, so long as they're willing to pay through the nose. Supply and Demand is a very dangerous concept when it's dead easy to create an artificial supply shortage for a very predictable demand. If your guild doesn't have, or doesn't enforce a Like Value trade policy, it's like stealing candy from a baby. And without a policy there's not much that you can do about slick traders even if you do suspect their motives, because
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DeletedUser7289
I play on 4 worlds, and of them 2 guilds use the trade calculator and 2 use the 2:1, 1:1, 1:2 trade ratios. I can honestly say that it all balances out about the same in the end (I've completed CE on 3 of the 4 worlds). The important thing is that as a guild, you have 1 agreed upon system for goods. The "free for all" trade system always ends up with someone feeling cheated, and leads to a lot of drama in the guild.
DeletedUser9375
Without adding to the rants above, I'll just say ... I have found the trade calculator to be very useful.
DeletedUser8428
If you read the guild profiles available, many of them mention their trading policy.
Czari
Active Member
This. ^ I honestly don't see what the point in debating this is. There are plenty of free trade guilds, fair trade guilds, as well as some "Do whatever you want guilds" so if one doesn't like the fair trade policy, then don't join a fair trade guild. The guild I'm in, which is in all worlds and is a trading guild, ie. no GvG, uses the fair trade calculator. "Unfair trades" (by our policy) may be arranged for various situations, are posted as such, and are up a short time. We have very little turnover in members with many having been in the guild 1+ years and some 2 years, the point being that some people do prefer a fair trade guild.
DeletedUser10517
Fair trades are trades that everyone follows.
If everyone in a guild always posts with the same guidelines, then all trades are 'Fair'......because everyone is doing the same thing.
If everyone in a guild always posts with the same guidelines, then all trades are 'Fair'......because everyone is doing the same thing.
DeletedUser11463
The debate will go on forever regarding what is "fair" and what isn't. Cornering the market is possible but unlikely except in a small guild or in a guild where you are near the top. Most guilds of 60-80 people have at least 2 or 3 people producing the same item and that doesn't include the fact that most of us are in different hoods. Shortages can temporarily exist in a guild but often get fixed fairly quickly by someone making multiple buildings of the same "scarce" good or people working in their hoods to get extras.
The great thing about various trading rules in guilds is that you can buy from guilds with a fixed rate going up and sell to guilds with a variable rate going down (or vice-versa). I regularly scan my hood and spend a few forge points getting good deals, then trade using the ratios the guild has set up. The extra goods more than cover the cost of the FP or 2 that it cost me. FP's get cheap when you get a few higher level GB's producing extra FP's daily.
The great thing about various trading rules in guilds is that you can buy from guilds with a fixed rate going up and sell to guilds with a variable rate going down (or vice-versa). I regularly scan my hood and spend a few forge points getting good deals, then trade using the ratios the guild has set up. The extra goods more than cover the cost of the FP or 2 that it cost me. FP's get cheap when you get a few higher level GB's producing extra FP's daily.