Every week, Gold Capped (from Basil "Euripides" Berntsen) aims to educate players about how to make money on the auction house. For the inside line on crafting for disenchanting, transmutation, cross-faction arbitrage and more, check in every Wednesday. For half-arsed, last-minute mailbag posts, tune in every Thursday after Basil forgot his deadline because he was buying his wife stylish side tables at large Swedish furniture stores. Also, feel free to email Basil any comments, questions or hate mail!

I have a bunch of questions and comments piled up in my poor neglected inbox, so today we're going to jump right in and address some of the good ones.

Bernake (awesome name, by the way) writes:

Previously you have established that it is not profitable it to transfer gold frequently across faction. While this is generally true, I play on a server where the Horde population playing at peak hours is no more than 600 people, less than 2,000 active on the server. I was wondering (if that) warrants a change in this policy, as the Alliance have over 9,000 active players with at least 600 on throughout the day and over 2,000 playing at peak hours on any given day. I was considering moving into the Alliance glyph market, as the Horde glyph market is quite small. I was wondering if you would support this move as well as give some insight?

I believe you're talking about this post on cross-faction arbitrage. In fact, it can be extremely profitable to move money and products across the neutral AH. I may have sounded a little negative because it is risky; however, unless you're losing a chunk of your stock to snipers or 20 percent of your gold to the neutral AH cut, it's not a bad thing to do. You can just buy to resell, or if you're having trouble finding mats on your home faction, you can use stock from the other side to keep your costs in line.

Alex writes:

Right now on my server, a character is posting all his glyphs for under 5 gold and undercutting by nearly 40-50 gold [editor's note: I assume you mean silver]. I asked him what he was trying to do, because I am one of the three biggest glyph salesmen on my server, and he said "killing the market." Also, he said that he is getting out of the market and just selling what he has left. My question to you is how should I handle this person? Should I just buy out all his supply, knowing that I can profit off them? Or should I just let people buy his and post mine once his are gone?

First off, no matter what you do about him, it's what you do despite him that will have the biggest impact. You should really make sure you never have a single market that can be taken from you by one person. In the real world, we call this diversification, and if you want to be immune to having someone take your lunch, you need to branch out.

With respect to the situation at hand, my first thought was the same as yours: Buy him out and resell once he's gone. After reflecting on it, though, I'd have to advise against that course of action. 5g glyphs are still 500 percent profit (depending on how you do the math), and if you literally buy everything he sells, he'll just go and make more. In fact, if I wanted to make money that way, I'd tell my competitors the same thing, expecting them to try and buy me out and hoping I disappear.

The harsh reality is that glyph walling can always make it so that nobody makes any money. It's a simple procedure to do, and if someone has the time to dedicate to crafting all the glyphs it takes, there's not much his competition can do about it. The eventual goal of every glyph wall, however, is to push so many people into other markets that when the waller starts posting at pre-wall prices, they have little to no competition. My advice: Configure QA with a high threshold and 48-hour auctions, and make sure you're there when he either runs out of steam or actually leaves (if he wasn't lying to make a sale).

Krem writes:

I have recently gotten my engineering to 450 and had a LOT of leftover eternal earth. Since the earth is worthless on my server -- just over a gold each stack on good days -- I'm considering nuking the bullet market. I have, you see, over 300 stacks of bullets. However, I'm constantly being undercut, often by silly prices (from 10 gold to 3 gold for a stack). This isn't a problem, except that I've filled my guild tabs. Now then, I'm considering simply flooding the market with excessively cheap bullets (say, 100 stacks). I know this will probably damage the market, but bullets are going away anyway.

The pros I can think of are that some of them will actually sell, it might drive the competitors away, and I'll have more space for other stuff. The cons are, however, that selling so many stacks is going to cost a bunch. Overall, I'm probably looking at a loss selling many, since I can't guarantee that enough will be sold. Then there's the damage to the economy. (And damage to the economy, but I'll be hiding behind an alt. Hurr.)

Is it worth it, oh great goblin? Don't really need the money, but vendoring all my beauties would be painful. And don't ask why I have so many. I didn't do my homework.

Eternal earth is a component in many different things. If it's really that cheap, see whether you can make Stoneguard Bands to disenchant. It is also a component in Titansteel Bars, Eternal Belt Buckles and a bunch of components of the saronite shuffle. If you limit your options to one single market, you're certainly going to have issues with flooding (which is fundamentally what you describe).

Ammo is another weird market, because none of us hunters ever buy small batches, and there are enough of us that you'll probably see some servers capable of buying 500 stacks on a raid night. Of course, most of us (my venerable dwarven podcast co-host notwithstanding) use arrows. It also has a terrible bag-space-to-gold-value ratio. Still, 3g is not a "silly" undercut -- by your own account, the mats are worth 20s. Anything above 1g is a phenomenal profit margin, to be honest.

My advice? Keep undercutting the undercutters, down to cost if you have to. Get your stock back down to manageable levels, then start pricing as high as you can. Here's the important part: Only make enough for a day or two of sales. A single stack of eternal earths expands into 100 slots of ammo. Just because you can make that much doesn't mean you should. Use the saved space to, for example, sell non-combat engineering pets.

Lastly, I'm not a goblin; I'm an auctioneer. Goblins are an unfairly cool race denied to the Alliance, and I'm someone who makes money by participating in the largest (or coolest -- I forget where I read the report) virtual economy in history.

---

Maximize your profits with more advice from Gold Capped, plus the author's Call to Auction podcast. Do you have questions about selling, reselling and building your financial empire on the auction house? Basil is now taking questions for a special series, "Ask an auctioneer," at basil@wow.com.

---

Tags: ammo, cross-faction-arbitrage, engineering, glyphs, gold, gold-capped, neutral-ah, pricing, strategy

Filed under: Economy, Gold Capped