All the money flows to the top.
You can go out and hunt for Imbuing materials, and sell it for money. Usually that money comes from the top down. But they use it to make things to sell at a profit. If you want what they made, you have to pay the profits. The money still flows to the top.
This isn't "bad" except that it's such a long road, and in the meantime the players not at the top are restricted from other game play.
Event? MOBs with things you can sell for the big bucks? Got to get looting rights? You are competing against those top players for those rights. You need the gear at least similar to what they have.
Want to hunt in the Abyss? To be effective you need the gear, go buy it from the top players. Pay the price. Work to get it. In the meantime, you are restricted.
To make matters worse is the effects of inflation, where that top gear is priced according to the top player's ability to pay, not yours. Takes longer to get "there". You are restricted even longer from the gameplay you want.
Now, most of you will say that's what games are about and it should be this way. I'll agree to an extent. The problem is that that extent has gone way too far for a "worldly" game like UO. At this point, UO would be better off to start zoning the world out into level groups. Make it more like WoW. Now, if you want to get something from an event, or hunt for materials to sell, you are competing with players like yourself. You can get somewhere at a more reasonable speed, because your zone is designed for you.
The alternative is what you've seen. You could cut half the gold out of UO and this will still stay the same. You can increase gold from lower level MOBs and it will only flow to the top again.
So, as much as I hate to say it, if you want UO like it is and won't give up the item based grind, then make it another WoW clone. Where players can play according to their "level". But then you have to compete with WoW.
Or you can do away with such hard to get requirements to compete. (You can still have hard to get items that aren't a requirement. Cool stuff, fun stuff, but balanced stuff.)
But you can't have it both ways.
You've seen the results. If you want to stop the entropy, you have to allow all your players to compete without this long, difficult road. Or be a clone trying to compete with WoW.
This post, in my opinion, describes how the UO economy is currently working.
Gold trickling up means those at the bottom are not producing anything of value. At least not producing value fast enough. Items wealthy players want are delivered through a combination of high end mobs, the RNG, and a little luck.
I am not a proponent of giving everything away. On the contrary, I prefer to work and learn for myself, but in the short time I have played this game I have worked 7 different crafting skills and have found them to be utterly outside of the real -actual economy.
My first character, a scribe mage, is mediocre at best when it comes to participating in EM events such as the Blackrock Golem thing or killing other high end mobs where looting rights is the name of the game.
Some of you may not be aware that when you are new, the game offers template suggestions. How many of those templates would be successful for a new player to enter the economy within a reasonable amount of time?
Samuri, Paladin, Ninja, Warrior, Blacksmith, Necromancer, Mage. These are the suggested templates I saw. When I went to my first EM event anyone care to guess which of those templates, as suggested to the new player, were getting the looting rights?
Who was getting looting rights? Archers, Tamers, Mystics, Sampires? Spellweavers?(uncertain if spellweavers were there getting rights and I still don't know exactly what a Sampire is)
Not one of those templates are even mentioned when a new player is confronted with making their first character. (warriors, Paladins, and Samuris all begin with swords or fencing, not Archery)
If you want to get the economy going in UO, players and the RNG must be able to produce more value into the economy. Otherwise the money will behave exactly as Trebr Drab describes it.
The rich will still be rich, the not rich will still have to earn their own way, but gold will circulate.
Is not entropy a measure of of energy not available for useful work? Then release it.
Agreed. Of course looting rights don't matter anymore. Anything that us vets want we can get ourselves. The things that lower end players can get us is pretty much all in the abyss and some rare drops around. The rest of the creatures "rng item system"/crafts other than imbuing produce nothing of value that can be sold to us that we cant produce ourselves in moments.
I think the important aspect here, the outcome that is really at the heart of UO's economy problem, is the lack of ability to be consistently productive until you get to the top. The "top" being so rich that you can buy anything, and not affected by the inflation, and thus driving the inflation.
Under that top, there's no productivity. GM smith? What can you produce that makes you viable, competitive, gives you a steady business, and is worth the effort (i.e. can sell for enough to be worthwhile)? This is the case for everyone except at the top. This is why you see the loss of player vendors and the condensation of business into just Luna, basically. With this situation also comes a lack of competition for those Luna merchants, solidifying the problem.
Compare today's economy to early UO's. Without the extremes of item grinding power gaps, anyone who wanted to produce and sell could in a reasonable time frame. The same issue was there, but it was much more reasonable.
Fixing this is the only real answer. But I can understand that I'm talking about a massive change, one that UO isn't likely to have the desire (time and cost) to go into. It extends into other aspects of the game too, and is wide ranging. It would be an overhaul. There's also a lot of separate issues, and in a real Sandbox and Worldly game everything affects everything else. For example, trying to turn Alchemy into an adventuring skill affects it's economic function. And if this situation of item levels were to be fixed, it would enhance the problems of imbalance in skill sets such as "Sampires" and Tamers.
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If you want to change the money system to take away the affects of inflation over the years, I'd suggest this. Story wise, "discover" that the gold in Sosaria has been counterfeited on a massive scale to destroy the Britannian economic system, to cause a collapse that might allow Britain's enemies to control the true wealth and power. These would be discovered to be mostly gold plated brass, and sometimes, very rarely, a true ancient gold coin is discovered (rare item). Issue a new coin, the Gold Sovereign, and change all NPCs into this new monetary system. Allow players to turn their existing gold coins into the Royal Treasurer, who inspects them, and gives them new Sovereigns for the "true" value of the stack (or check), a random value that's much less.
Gold on critters can still be the old gold, mostly counterfeit, and leave the Treasurer in game for exchanges. Some of the newer Sovereigns can be added to loot, or not. Over time, or not.
This would reduce the gold that's in UO and remove the inflation, while still leaving "the rich" rich comparatively. It would cause a revaluation of the economy and it's items, without the inflation. It would leave players where they are in the food chain, and not punish anyone. It would remove the affects of inflation, and allow players with less to afford more. It would increase the flow of business, which would increase the demand on materials and ingredients down the line.
This would help. But it does still leave the original problem in the game.
Phoenix, Cal, Messana, all of you, in my mind the best thing you could do for UO would be to get the financing and the ok to overhaul UO's entire system with this in mind. But I'm also sure that that expenditure would be a very hard sell. Especially right now.
And it's obvious from the replies here that most players don't really want change. They want some specific quick fixes, but not real change. That's another hard sell. I don't expect to see it happen. And that's really a shame.
Edit to add: But if you just did it anyways, they'd go willingly, kicking and screaming.