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dmindock
Sneak
163 Posts
    
 | | 07/23/2006 9:23 AM |
| Why to prices rise, and it has nothing to do with the price of oil.
DDM boosters are going to rise in price, this is bad news to me as I buy about 3 cases of each set of DDM and Star Wars as they come out. I own between 3 and 4 thousand minis and I have huge amounts from every set and I bought every set new off the shelf.
For those of you who have met me before I am always at Winter Fantasy and I live in Washington DC. I would for a very large Telecom company and I am an expert on Optical Physics and Currency Crises (This means I study how currencies fail like in “The Great Depression”the“Argentina Currency Crisis and how currencies enter hyperinflation etc…). Let me tell you what is really going on with prices and why they are going up across the spectrum of consumer goods.
And buy the way, Oil is not the Primary Driver.
The US is printing huge amounts of money. The primary way money is created buy either printing more currency called “Monetizing Debt” or by creating money through borrowing money from banks in the form of car loans, mortgages, credit cards, etc… Banks create money. They have done this since before Jesus walked the earth.
Since the “Middle Ages” banks have used a process called “Fractional Reserve Banking” in order to limit the amount of money they can create. This basically means that for every dollar of money, either in the form of cash or debt, in the bank, the banking system can create between 5 and 100 times that amount in new loans, which is now money.
So If you buy your house for $100,000 and then sell it for $300,000, then you buy a new house for $500,000 you have created $200,000 of money immediately, then additional $200,000 is new in the banking system and is now used to create $20,000,000 in new loans. As you can see the next loan created by this additional debt increases the amount of credit in a circular fashion called positive feedback. Basically it loops causing an exponential rise in the money supply as houses are bought and sold and bought and sold again.
Housing prices rise because too much money is chasing too few goods. Interest rates fall because too much money is chasing too few borrowers.
Why does this great inflation in the money supply not initially appear in the prices of goods and services like food, toys, tables, etc…?
Since this money is created in the debt market in the form of loans and can only be accessed initially in the form of loans then all goods attached to a loan process increase in price. Therefore the mortgage market itself directs this money back into housing.
However because money in created in the debt market it also rises the price of equities, like stocks because corporation called “Hedge Funds” can borrow unlimited amounts of debt from banks in order to buy stocks, bonds, real estate, with no regard to how much capital they actually have. They are not under SEC Rule “T” which specifies that you must have a dollar backing each dollar you borrow like in a “margin” account that individuals tend to use. For corporations this has been totally deregulated!!!
Equities and real estate rise out of control in this process, typically going up over 600 percent. Then something magic happens and this pattern is been the same for over 300 years, since the invention of a tax based currency. A tax based currency was invented in the Western world by the Royal colony of Massachusetts in 1693.
Real estate gets so high it leaves the ability buy the property through normal means because it has long since passed the level of affordability. People and corporations start buying property with the expectation of rising prices. They service their mortgage by borrowing against the equity in the property. I call this being caught in the updraft. Other borrow against the value of their home with a secondary mortgage or HELOC loan. In this process money is now entering the real economy of goods and services we actually buy on an everyday basis like food, energy.
Now after prices rise too high money brought into the real economy cannot be directed back at the debt economy because prices have risen too much. This forces people out of the debt market. This in turn limits the amount of money creation, causing prices to reach equilibrium. Since prices are beyond affordability those who depend on rising prices to service debt are forces into bankruptcy, causing a decline in prices.
However since only a very tiny amount of money is used as the basis of supporting the loans, then the banks go bankrupt as well.
In response the government bails out the banks and liquefies the banking system. They do this through public works projects, wars, etc… This has the effect of injecting the economy with money. Now too much money is chasing too few goods, prices rise due to the growth in the money supply.
How does this affect the price of DDM boosters you say.
Here is what will happen. Prices are rising, however incomes are not. This means that discretionary spending is going down as more of peoples buying power is directed to basic living expenses. The first reaction will be to raise prices. However, since demand will go down supply of DDM boosters verses available buyers will force prices down. Then as wages start rising again then DDM boosters shall increase with inflation as money available for discretionary spending increases. This may be a few years from now.
How much money is the US money supply growing by?
Before we stopped reporting it this last March, and we reported it since the 19 century, we were at over 9 percent money supply growth year over year and accelerating. The US is probably at over 12 to 15 percent by now.
How big is the US national debt which is reported.
9 Trillion dollars
How big is the US national debt which is off budget and not reported, like social security, the war, and Medicare.
Estimated at 55 Trillion.
There is now way to pay this money out without going into Hyperinflation.
Same pattern for over 300 years.
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synecdoche
Warrior
252 Posts
| | 07/23/2006 11:51 AM |
| Without picking at your general theory, how does the observation that the price of DDM boosters will have increased by 50%, while the broader consumer price index has risen by 10% in the same time; i.e. even if your explanation explains the general inflationary trend in the economy, it does not distinguish the relatively greater price increase for boosters.
IMHO, the explanation lies in a promotional pricing strategy employed by WOTC. Pricing below the required rate-of-return on early product in order to encourage success of the product line, followed by harvesting of extra profits in later periods.
-Syencdoche | |
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Stabmastaarson
Sergeant
442 Posts
| | 07/23/2006 12:47 PM |
| | Wow. The first explanation is very thorough, the second one seems to make sense too. | |
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Thenameless
Warlord
12481 Posts
The Fortress of Solitude
| | 07/23/2006 1:12 PM |
| quote:
Originally posted by synecdoche
IMHO, the explanation lies in a promotional pricing strategy employed by WOTC. Pricing below the required rate-of-return on early product in order to encourage success of the product line, followed by harvesting of extra profits in later periods.
-Syencdoche
I must admit, if this is in fact what they are doing, then it will work on me and most of our group. For the most part, we are hooked. As long as they keep making interesting minis, and the tournament scene remains vibrant, we will stay in. | |
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Kunimatyu
Sergeant
725 Posts
| | 07/23/2006 1:15 PM |
| I'd buy your first explanation if and only if the CPI increased by 50%. Which it hasn't, as the CPI increasing by 50% would be a major national crisis that the Fed would take steps to resolve.
This housing bubble is going to burst eventually, though. And it won't be pretty. | |
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zenthrus
Warlord
5132 Posts
SLC, UT
| | 07/23/2006 1:33 PM |
| quote:
Originally posted by Kunimatyu
This housing bubble is going to burst eventually, though. And it won't be pretty.
Tick, tick, tick.....[:o]
That's a really great analysis of speculative feedback. It might even be a partial contributor to the DDM price hike.
I like simple explanations.
Price of oil in July 2004 = ~$35/barrel. Price of oil in July 2006 = ~$75/barrel.
Price of gasoline in July 2004 = ~$1.80/gallon. Price of gasoline in July 2006 = ~$2.90/gallon.
Cost of production materials (oil by-products for the plastic, the paint, etc) and cost of transportation have both roughly doubled in two years.
Just considering these two factors, that's enough to drive up the price of a consumer product. Adding in the speculation bubble/non-existant money problem and it's very small wonder the price of a booster is going up.
Unfortunately, my income isn't self-adjusting to the rising cost of living [:(] | |
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dmindock
Sneak
163 Posts
| | 07/23/2006 1:41 PM |
| Good Question, and one that is often asked. Why do prices rise at a different rate than the rate of money creation.
The answer
Money is not distributed evenly across the economy. Say take a look at the rise of housing prices, which has increased value in multiple trillions while prices of goods, services, and wages have remained more or less constant.
Housing is many urban area grew at over 20% to 30% and beyond while the money supply only grew by 5% year over year. Food, medical expenses, insurance have all increased at double digit rates consistently over the past few years.
Here is the kicker, during a high rate of inflation, housing can actually collapse. This was been observed many times and happened in 1932 in the US when the use tripled the money supply to bail out the banks, while housing prices across the country collapsed.
Why do these things happen even though the money supply is increasing, sometimes tripling in 6 months like in the US in 1932 when Herbert Hoover had the Federal reserve triple the money supply from 700 million to 1.8 billion in the first 6 months of 1932. The Home owners loan corporation (today it is Freddie Mac and Fanny Mae) was invented to keep housing prices from collapsing further after then ran up 600% in the roaring 20’s
What happened to cause housing prices to fall even during great inflationary pressures. We must first understand why housing prices increased. During the 1920’s housing prices increased due to a lowering of the lending standard and a debt bubble was formed. This caused housing and equity prices to increase at double digit growth every year from 1922 until 1929. Interest only loans were invented (and banned in 1933), house flipping was invented and many people owned multiple homes, some owned 15 to 30 homes.
The housing inventory skyrocketed, however prices continued to increase. This was caused by the debt bubble. Then in 1929 the first part of the debt bubble popped and the stock market crashed. This was not a major event. In 1931 is when people really started to feel affects of not being able to pay mortgages and the banks began to fail en-mass. By 1932 America was in the depths of the Depression. For 3 years prices in goods and services fell by around 3% and then after 1934 prices started to rise again.
In 1932 housing inventories were the largest in history. With no way to support the debt bubble’s growth any further no one was available to buy home, so the homeowners who had been paying mortgages via borrowing against the house now went bankrupt. This caused prices to collapse.
Now with this in mind let me answer your question
First the US dollar is loosing buying power. However you can not use exchange rates to figure this out because when the US inflates, so does every, yes I mean every, country on the planet. This is because the US denominated debt makes the basis of every foregn banks reserves and is used as the basis of creating money in their country. This has been true since the US dollar became dominant after World War 2.
So as the US inflates, so does every one else, so all buying power of all currencies are declining. When we say the dollar rallies, it does not mean the purchasing power of the dollar has increased, only that other currencies are losing value faster than the dollar. All currencies are declining all the time.
So, if DDM boosters have gone from I think $9.99 a booster in 2001 to $14.99 in 2007 then we have a rise of 50% in six years. This would be a rise of 6% year over year.
Now the value of the currency is loosing value faster than that so I would say that they may be loosing money on this and not keeping of with inflation.
During the beginning of an inflationary until crisis incomes never, and I mean never keep pace with inflation. We can go all the way back the13 century and find evidence of this.
Hopes this helps
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Thailfi
Sergeant
956 Posts
| | 07/23/2006 1:47 PM |
| There is only one real reason for a DDM price increase to $14.95. That is marketing guys and accounting guys got together at WOTC and decided that was the price point that would maximize their profits on this line. They would have bumped it to $87.50 a booster if they thought they could squeeze more out of the bottom line with that number, but they decided that any more than $14.95 would cause a sales volume drop that would result in less overall profit.
It's a business and they are going to squeeze every last nickle they can out of you. If anyone from WOTC tells you anything different, they are liars.
By the way, I wouldn't hold my breath on the housing market bubble bursting. It will definitely flatten out and houses will be on the market longer, but anyone that thinks there will be a substantial devaluation in home values just doesn't know what they are talking about. | |
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dmindock
Sneak
163 Posts
| | 07/23/2006 1:54 PM |
| Consumer Price Index
Be very careful with the CPI, that number has been fixed by government managers for years. Here is the history of it.
Why do we even have an CPI number. This goes all the way back to the beginning of unions and I think in this came about as a result in the 1950’s. Unions use collective bargaining. So they wanted to link their pay increases to inflation. Therefore the CPI was invented. And for many years it was a good indicator.
However, this changed after the 1970’s
In the 1970 the US went off of the “Gold Standard”, which by the way was not a real gold standard. So the US started printing money like crazy, increasing the price of everything. By this point a number of contracts was been linked to the CPI number and the government didn’t want to pay for the increases, so they began to adjust the calculation to underreport inflation.
Since then every president has done the same. The last major overhaul was under Bill Clinton
At this point the CPI is a purely political number, and means nothing anymore.
The CPI is currently manipulated through three techniques. The first is Hedonics, the other is substitution, and the third is in which products the CPI actually uses. It is fair to say that they invent a number, and then back into it at this point in history.
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dmindock
Sneak
163 Posts
| | 07/23/2006 2:12 PM |
| All though it is true for the nation as a whole that housing prices do not decline as a nation since The Great Depression, it is very true that housing can decline significantly where prices have been hyperinflated through the expansion of debt. Then after the bankruptcies have been resolved then housing prices then go back up due to inflationary pressures.
It is a Myth that Housing Prices Do Not Fall and Only Flatten.
It is not supported by any facts what so ever. That is why we have bankruptcy liquidations. Most of you are too young to remember the last major banking crisis which was the Saving and Loan Scandal. This was also a debt bubble, but only confined to the S&L’s. The S&L’s were bailed out for approx 220 billion. Prices on homes and property took one hell of a hit.
Then prices rise again due to the printing of money through debt.
Rapidly increasing housing prices, and they are increasing very quickly in urban areas across the globe are indicative on one thing, that the world currency is failing. Any by failing I mean that this currency will be replaces by another system or currency
The Great Depression was linked the British Pound Sterling, the world currency at the time, failing which failed due to inflation in funding World War 1.
What generally happens is that the currency fails and another currency takes its place.
In the US this is currency number 5
1.) Revolutionary War Currency
2.) First Bank of the United States
3.) Second Bank of the United States
4.) Civil War Green Back
5.) Federal Reserve Note
Any guess what happened to currencies 1 though 4.
I also don’t debate how Wizards is coming up with prices; it is irrelevant as supply and demand will determine prices in the end. My point is that 14.99 for a booster with the amount of inflation we have in not that much of a rise in price and the price when viewed in absolute terms looks to be falling.
How can you increase prices, but in reality it is falling?
Easy, the price increase does not keep pace with inflation.
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IHawk
Underboss
1054 Posts
Lisle, Illinois
| | 07/23/2006 2:23 PM |
| 2 dollars may seem like a large price hike, percentage
wise, but WotC doesn't see but 25-40% of that MSRP increase.
Even if it as high as 40%, which i doubt it is that high...
that is only like $0.10 per piece increase. That really
isn't all that much considering part of that 10 cents
includes the increases for profit (holding margin constant),
materials & labor and as it has been so thouroughly
explained inflation and all.
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One_Wing
Sergeant
494 Posts
London
| | 07/23/2006 2:28 PM |
| While i appreciate the time and energy that has obviously gone into such a detailed explanation, there is a much simpler alternative explanation.
Price elasticity of demand (PED) is a measure of how much demand changes with price changes, it is measured by dividing the percentage change in demand for a good by the percentage change in price that led to the demand change. As long as this number comes out as less than -1 (always will be negative, since demand will decrease when prices increase), increasing the price will increase profits. It makes economic sense for firms to increase prices until the PED comes out at exactly -1. At this point, profits will be maximised. Addictive goods (which DDM essentially is) tend to a have a very small PED, allowing companies to increase prices ahead of inflation without losing profits, and I think this is what we are seeing here. | |
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dmindock
Sneak
163 Posts
| | 07/23/2006 3:05 PM |
| I think the point I am making is that price increases in non necessities do not keep pace with inflation. Neither do wages. Wizards would not be getting any more profits because the increase in price has been eroded away by increases in other areas.
Can you tell when profits are maximized, no that would be impossible. This is because as incomes do not keep pace with inflation people have less to spend on entertainment. This reduction in real income forces people to spend more on necessities and less on entertainment. Therefore demand destruction is not caused by the increase in the price but the forcing out of people to spend money on necessities rather than spend that money on DDM.
At the current time America’s are assuming more debt to make up for the shortcoming in their pay to finance their lifestyles. When credit becomes hard to come by, home equity loans are cut off, then consumers will be forced away from non necessities like DDM. This will force prices lower as supply will be greater than demand regardless of the price of DDM.
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MechaKingGhidra
Sergeant
632 Posts
| | 07/23/2006 3:28 PM |
| | I'm quite flabbergasted, if you will, at the complexity of the situation. Even at the beginning my head was filled with too many ideas the explanation could have turned out to involve in some way or another. Of course, since I've still got another year of high school to complete and I'm not going to take anything that even vaguely references that to any significant degree whatsoever, this is to be expected. Heck, when it comes to printing money, all I know is that Canada has to have gold equal in value to the amount of currency they want to print. Not exactly that in-depth, so you get my point. All in all, assuming I even somewhat understand the explanation, I am not going to question prices of mostly everything now to save myself from being flooded in a torrent of information again.[)] | |
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robbdaman
Underboss
2380 Posts
| | 07/23/2006 3:42 PM |
| Prices increase because that way WotC makes more money. Pure and simple. So the quest for everyone else is to not pay retail for them.
R~ | |
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MerricB
Underboss
2353 Posts
Australia
| | 07/23/2006 10:46 PM |
| Please also consider China in all of this. The monetary and economic policy of China has been changing significantly in the last few years, and it has an influence on everything that is made there.
Cheers! | |
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Corim Danex
Warlord
6842 Posts
West Valley City, Utah
| | 07/23/2006 11:53 PM |
| | If China charges WotC more, than WotC would have to raise prices or start losing money. | |
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dmindock
Sneak
163 Posts
| | 07/24/2006 8:23 AM |
| I think is is more accurate to say, that in real terms, that incomes are going down as they do not keep pace with the real rate of inflation.
Therefore the price of DDM is not really going up in real terms, but down.
However, incomes are not keeping up with inflation and is lagging to an even greater extent.
Therefor due to inflation, you are being impoverised.
A 3% raise will not keep pace with the real rate of inflation. | |
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RobWreck
Warrior
295 Posts
| | 07/24/2006 9:27 AM |
| While the jump to $14.95 sounds awfully expensive, how many of us are actually paying the current $12.95 a booster price? I know that I pretty much stick to buying cases, and I get them at my FLGA for about $100 (so about $8.33 a booster), so I expect to see cases of Unhallowed at about $115. That's really not that bad... about $1.25 a booster more.
It's going to suck for people that have to buy individual boosters, and I think the price increase is going to have a negative impact on getting new players to join. That's a sign of the beginning of the end...
Rob | |
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nyjastul69
Commander
2731 Posts
Rhode Island
| | 07/24/2006 9:32 AM |
| quote:
Originally posted by dmindock
I think is is more accurate to say, that in real terms, that incomes are going down as they do not keep pace with the real rate of inflation.
Therefore the price of DDM is not really going up in real terms, but down.
However, incomes are not keeping up with inflation and is lagging to an even greater extent.
Therefor due to inflation, you are being impoverised.
A 3% raise will not keep pace with the real rate of inflation.
Could you suggest an inflation calculator that reflects the true rate of inflation? | |
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Sharn Inquisitor
Underboss
1623 Posts
| | 07/24/2006 9:38 AM |
| quote:
Originally posted by RobWreck
It's going to suck for people that have to buy individual boosters, and I think the price increase is going to have a negative impact on getting new players to join. That's a sign of the beginning of the end...
Rob
I said something similar in the thread that announced the price hike. Casual buyers, those that really add money to the margins at stores since they pay full price are going to potentially buy one booster, where they would have bought two previously.
I love all this in depth speculative analysis on the rise in booster prices. In all reality, it could have nothing to do with anything, except the CEO (perhaps) just bought a new home that stretched his wallet and needs that big bonus to pay the mortgage...now that's how the housing market affects pricing...
That said, I like synedoche's speculation best. | | | |
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Sulaco
Underboss
1605 Posts
| | 07/24/2006 10:35 AM |
| quote:
Originally posted by dmindock
Why to prices rise, and it has nothing to do with the price of oil.
You are right, it has nothing to do with oil and everythign to do with greed. What happens is that somewhere along the line someone decides they are not making enough profit and so raise prices.
Same pattern since the invention of commerce. | |
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PatEllis15
Commander
4463 Posts
| | 07/24/2006 11:34 AM |
| quote:
Originally posted by Sulaco
quote:
Originally posted by dmindock
Why to prices rise, and it has nothing to do with the price of oil.
You are right, it has nothing to do with oil and everythign to do with greed. What happens is that somewhere along the line someone decides they are not making enough profit and so raise prices.
Same pattern since the invention of commerce.
Greed? That is an unflattering word... How about "Profit". At teh end of the day, WotC needs a specific level of return for the money they are spending on DDM. If Margins have declined, they have 3 options: 1) Cut costs: Difficult to do when your staff has increasing wages, production costs are going up, and transportation/distribution cost are skyrocketing. 2) Stop the production of the product line, invest more heavily in another line: this would make no sense if there is strong demand for the product... 3) Raise the price.
Obviously they go with 3 because they still see there is demand for the product, and they can't cut costs to fully restore the Margin. That is not greed, that is part of supply and demand, and a natural part of a Capitalist market.
Pat E | |
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dulsin
Sneak
171 Posts
| | 07/24/2006 11:42 AM |
| A good primer on Macro economics but not very relivant to the discussion. The price of producing plastic has more than doubled over the last year and this has more to do with the price of natural gas than oil. Fortunatly only a small part of the costs come directly from the price of plastics which is why the booster prices didn't go up to $24. Most of the price is packaging and shipping and thos costs have gone up but by a much smaller margin than plastics.
I don't mind them increasing the price of boosters as long as they continue to improve quality. With the extra $2 they can aford to make common stirges and add a painting step to every figure.
Greed? Welcome to America you communist. [:D] | |
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robby
Sergeant
918 Posts
| | 07/24/2006 11:54 AM |
| quote:
Originally posted by PatEllis15
quote:
Originally posted by Sulaco
You are right, it has nothing to do with oil and everythign to do with greed.
Greed? That is an unflattering word...
I disagree. In a corporate context, as Gorden Gecko said, "Greed is good".
Greed pays for lots of things. Greed gets Linae a raise, gets Shoe a raise, keeps people employed over the long term, keeping the aggregate corporate knowledge high. (Greed also hopefully allows for some additional QA people.) Greed lets you continue making the same number of figures even when the costs of supplies/transportation/labor increase, or when global financial circumstances change. And greed ultimately allows the DDM line to provide enough returns to continue making it.
Greed can be a bad thing - withness sleazebags like Kenneth Lay (RIH) - but there is a big difference between that kind of behavior and a $2 price increase.
BTW - thanks dmindock and the rest of you for the somewhat overwhelming explanations. I didn't understand all of it, but I appreciate it. [:)]
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Zoons
Underboss
1067 Posts
| | 07/24/2006 12:36 PM |
| quote:
Originally posted by nyjastul69
[br
Could you suggest an inflation calculator that reflects the true rate of inflation?
Inflation is loosely defined as the change in the cost of living expenses over a given period of time. I agree that the government has been lying about actual values for many years to control contracted wage increases which are tied to these figures.
In esscence they should be measured based on actual living expenses:
Food
Water
Shelter
Clothing
& Energy (Since energy is tied to shelter and workforce)
Taxation
Notice the lack of "discressionary spending" in that equation.
Separately, but on topic:
The reason things "crash" so hard when the bubble finally bursts is that people blindly believe that it'll all work itself out. Most people don't monitor their discressionary income or don't understand debt.
Some easy way's to monitor a society's fiscal health...
Relative Debt Load (This is a measure of the amount of time it takes to pay off current debts at current income assuming no discressionary spending at all). This is increasing in the US at an alarming rate.
Poverty Level - Percentage of population that can afford minimal living expenses without support.
Jobless Level - Percentage of population working verses able to work. Note, you don't fall off of this list just because you are not seeking work.
Hoplessness - (ignoring reality) Addictions. Gambling (Including Lottery). Drugs. Crime Rate.
Most of these things can be measured and give a fair indication of the direction things are going. | |
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Champion of the Blink Dog. | |
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maineman
Sneak
90 Posts
| | 07/24/2006 12:38 PM |
| I agree that boosters at 14.95 will deter many people from joining the game. I run a games club at my school and the current price is expensive enough for most famalies.
I will look into buying cases and singles off the net when the price goes up. My days of buying boosters at random will be numbered I am afraid. I totally understand WOTC and don't blame them for the price hike, but I really think that new players might go down, which in the long run might hurt? But, with a huge company as WOTC is, probably not.
that's my 2 cents | |
How old would you be if you didn't know how old you are? | |
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CarrionCrawler
Underboss
1760 Posts
| | 07/24/2006 1:34 PM |
| | I always thought that they would continue to raise the prices of regular boosters by a couple dollars until they reach the $20 mark per booster for every set. That way we get huges every set and they get more money. | |
Vindicated Night Below Champion of the Digestor!!! Knight of the OozesIcons called shot: Angry MobThe stink of rotten meat surrounds this multilegged creature with a segmented, 10-foot long body. Eight writhing tentacles protrude from its head, growing directly from below its clacking mandibles and tooth-filled maw. | |
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Sulaco
Underboss
1605 Posts
| | 07/24/2006 2:19 PM |
| quote:
Originally posted by PatEllis15
Greed? That is an unflattering word... How about "Profit". At teh end of the day, WotC needs a specific level of return for the money they are spending on DDM. If Margins have declined, they have 3 options: 1) Cut costs: Difficult to do when your staff has increasing wages, production costs are going up, and transportation/distribution cost are skyrocketing. 2) Stop the production of the product line, invest more heavily in another line: this would make no sense if there is strong demand for the product... 3) Raise the price.
Obviously they go with 3 because they still see there is demand for the product, and they can't cut costs to fully restore the Margin. That is not greed, that is part of supply and demand, and a natural part of a Capitalist market.
Greed is an unflattering word for an unflattering emotion. There is nothing inherently wrong with profit, but greed is the desire to maximize profit at all costs. Banks that make redord profits yet continue to raise fees and lay off staff so that they can make even more profit, for example.
I did not say that Wizards was greedy, but somewhere along the line greed plays in. Someone got greedy which raises the costs for everyone who deals with them.
The so-called "oil crisis," for example, is a load of bunk for a couple of reasons:
First, taking into account the yield of finished product the price of gas should go up about a 1¢ for every increase of $1 per barrel, yet we have seen prices rise by several orders of magnitude more than that.
Second, a little quiz. Do you know where the vast majority of North American oil comes from? Saudi Arabia? Iraq? Somewhere in the Middle East? The Gulf of Mexico? No folks, it comes from good ol' Canada, and last time I checked our oil fields were niether in a warzone or battered by hurricanes.
In other words, friends, it is just pure, unadulterated greed on the part of the oil companies. Their greed impacts everyone who relies on oil (read: the entire industrialized world) and that is just one example.
PS - There is nothing "natural" about Capitalism. | |
Champion of the Gelatinous Cube. Nemesis of Gnomes and Dinosaurs.
Over the centuries, mankind has tried many ways of combating the forces of evil... prayer, fasting, good works and so on. Up until Doom, no one seemed to have thought about the double-barrel shotgun. ~ Terry Pratchett | |
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Sulaco
Underboss
1605 Posts
| | 07/24/2006 2:26 PM |
| quote:
Originally posted by dulsin
Greed? Welcome to America you communist. [:D]
No thanks, I think I'll stay up here in Canada. I like not having to refinance my home to pay for medical care. | |
Champion of the Gelatinous Cube. Nemesis of Gnomes and Dinosaurs.
Over the centuries, mankind has tried many ways of combating the forces of evil... prayer, fasting, good works and so on. Up until Doom, no one seemed to have thought about the double-barrel shotgun. ~ Terry Pratchett | |
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rhane
Underboss
1412 Posts
| | 07/24/2006 2:33 PM |
| quote:
Originally posted by Thailfi
There is only one real reason for a DDM price increase to $14.95. That is marketing guys and accounting guys got together at WOTC and decided that was the price point that would maximize their profits on this line. They would have bumped it to $87.50 a booster if they thought they could squeeze more out of the bottom line with that number, but they decided that any more than $14.95 would cause a sales volume drop that would result in less overall profit.
It's a business and they are going to squeeze every last nickle they can out of you. If anyone from WOTC tells you anything different, they are liars.
Nice post!
I've been wrong before, and I'll be wrong again, but every time they monkey with the golden goose like this, they're taking a big risk...
Will this risk be the final straw? | |
Rhane
"The focus is sharp in the city..."
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greyhaze
Warlord
7713 Posts
| | 07/24/2006 2:34 PM |
| quote:
Originally posted by Sulaco
Second, a little quiz. Do you know where the vast majority of North American oil comes from? Saudi Arabia? Iraq? Somewhere in the Middle East? The Gulf of Mexico? No folks, it comes from good ol' Canada, and last time I checked our oil fields were niether in a warzone or battered by hurricanes.
In all fairness they don't need the plastic in the states, they need it in China where the product is made which means more than likely it is coming from somewhere other than Canada. Although you're right most of our oil does go to the states to get refined.
But, your point is valid, the price increase of materials is not the reason for the increase. It is greed.
quote:
Originally posted by Sulaco
PS - There is nothing "natural" about Capitalism.
Very nice. [:)] | |
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Called Shots: Frost Giant in Dangerous Delves. | |
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synecdoche
Warrior
252 Posts
| | 07/24/2006 2:57 PM |
| quote:
Originally posted by Sulaco
PS - There is nothing "natural" about Capitalism.
Although empirical evidence does seem to confirm that "law of supply and demand" thingy. | |
Champion of the Green Hag | |
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Sulaco
Underboss
1605 Posts
| | 07/24/2006 3:02 PM |
| quote:
Originally posted by synecdoche
quote:
Originally posted by Sulaco
PS - There is nothing "natural" about Capitalism.
Although empirical evidence does seem to confirm that "law of supply and demand" thingy.
Empirical evidence also confirms that the strong can impose their will on the weak and that some humans want to completely eliminate other human groups solely cos of their skin colour or religion.
Just cos it's factual doesn't make it natural. | |
Champion of the Gelatinous Cube. Nemesis of Gnomes and Dinosaurs.
Over the centuries, mankind has tried many ways of combating the forces of evil... prayer, fasting, good works and so on. Up until Doom, no one seemed to have thought about the double-barrel shotgun. ~ Terry Pratchett | |
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Zoons
Underboss
1067 Posts
| | 07/24/2006 3:27 PM |
| quote:
Originally posted by Sulaco
quote:
Originally posted by synecdoche
quote:
Originally posted by Sulaco
PS - There is nothing "natural" about Capitalism.
Although empirical evidence does seem to confirm that "law of supply and demand" thingy.
Empirical evidence also confirms that the strong can impose their will on the weak and that some humans want to completely eliminate other human groups solely cos of their skin colour or religion.
Just cos it's factual doesn't make it natural.
Actually it does. But just cause it's factual doesn't make it ethical. Humans have "naturally" been "evil/unethical" since the beginning of recorded time whether you believe in creationism or evolution.
Examples are Cain and Able from the creationist standpoint (or even Adam and Eve in the garden).
Secular examples are the Holocaust of WWII and the mass graves found in the desert of Egypt.
Time doesn't change human nature, only the methodology. | |
Never teach a pig to sing. It's a waste of time and it annoys the pig.
Champion of the Blink Dog. | |
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kyrin
Commander
3171 Posts
| | 07/24/2006 3:45 PM |
| quote:
Originally posted by Sulaco
quote:
Originally posted by dulsin
Greed? Welcome to America you communist. [:D]
No thanks, I think I'll stay up here in Canada. I like not having to refinance my home to pay for medical care.
But apparently you do have to refinance to pay for postage, so it all evens out. [)]
Trying to keep it from turning uglier,
JIM
aka kyrin | |
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kyrin
Commander
3171 Posts
| | 07/24/2006 3:48 PM |
| quote:
Originally posted by synecdoche
quote:
Originally posted by Sulaco
PS - There is nothing "natural" about Capitalism.
Although empirical evidence does seem to confirm that "law of supply and demand" thingy.
You mean the law that says when the CEO's supply of money runs short, he demands a price increase? [:)]
JIM
aka kyrin | |
My Have/Want List <-|-|->My Trades and References 1 <-|-|->My Trades and References 2
Pronounce "Drow" like "crow"! Viva la Revolution! We Shall Overcome!
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Vindicated Champion of the Androsphinx! | |
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Sulaco
Underboss
1605 Posts
| | 07/24/2006 4:10 PM |
| quote:
Originally posted by kyrin
quote:
Originally posted by Sulaco
No thanks, I think I'll stay up here in Canada. I like not having to refinance my home to pay for medical care.
But apparently you do have to refinance to pay for postage, so it all evens out. [)]
Touché! Well played, sir, well played. [:)] | |
Champion of the Gelatinous Cube. Nemesis of Gnomes and Dinosaurs.
Over the centuries, mankind has tried many ways of combating the forces of evil... prayer, fasting, good works and so on. Up until Doom, no one seemed to have thought about the double-barrel shotgun. ~ Terry Pratchett | |
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Kunimatyu
Sergeant
725 Posts
| | 07/24/2006 4:49 PM |
| quote:
Originally posted by rhane
Nice post!
I've been wrong before, and I'll be wrong again, but every time they monkey with the golden goose like this, they're taking a big risk...
Will this risk be the final straw?
I doubt it'll be the final straw (they may just have wanted to make DDM prices even with Dreamblade), but things are inching closer and closer to the point where it'll be difficult to hook new people, and as the old people leave over time, it'll cause a problem. | |
Champion of the Aboleth, Prophet of Denizens. BW Called Shot: Babau, UH Called Shot: Aspect of Vecna | |
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oyvind
Warrior
238 Posts
| | 07/24/2006 4:58 PM |
| Thanks for great insights, all! I knew about most mechanics behind inflation, and I knew I didn't even know "anything", but I read this thread with great interest. I think nothing can easily explain the price hike. There are too many factors to consider, and I'm sure that it's due to inflation, one way or another.
Note to dmindock (and the rest of you if you're interested): This line of products (Dungeons & Dragons Miniatures Game) didn't start in 2001. It started in early fall of 2003. We're talking about a price increase of about 50% over nearly four years, not the six years you suggested. Other than that, I think you have the most logical explanations of the lot. Good work and thanks!
If greed is a major factor in the price increase, why does it have to be WotC's greed? Please remember that they have to rely on lots of different companies (or even industries) to be able to make these small dolls (my fiancée's take on DDM). I think Hasbro has told WotC that they have to make so and so much money from all their different product lines, so the hike in prices has probably been demanded by Hasbro, and they are probably the only ones who really know why... | |
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