The Market Dip of 2008 began during the week of 20 August, 2008 and lasted until approximately mid-September 2008. During this time, a large number of expensive items (most notably, Godswords) experienced an all time low in price due to a number of possible factors (see "Possible Causes", below).
Items affected by the crash Edit
- All the Godswords and God Wars armour.
- High level armour, like Barrows and Dragonfire shields.
- High level weapons, like the Saradomin sword and Abyssal whip.
- High level Treasure trail items (Third Age armour not included).
- All of the God Vestments.
There were likely a variety of reasons for the crash, including:
- School Starting: Many players start school in late August. The summer ending and many players selling items in anticipation of playing less after the start of school could have been the primary cause of the crash. Conversely, many of the items that were affected by this crash rose slightly when school ended before Christmas 2008 and also near the end of May 2009. These rises were not nearly as significant as the crash of August 2008, but do suggest that school affects prices of the items concerned.
- Player reaction to the upcoming Player vs Player servers due out late in the year: Players anticipating more powerful weapons and armour for player killing may have mass sold their existing weapons/armour prematurely.
- An engineered effort by a group or clan of players to cause destabilization in the economy: A group of players may have come together and planned to cause havoc with the market values of high priced items. This is a possible scenario, but unlikely because the group of players would have had to stockpile items over a long period of time and sell them very quickly to crash the market, which is very uncommon compared to groups participating in buy-outs.
- An update to the Grand Exchange caused some items to update more frequently by updating with a lower volume of goods traded, causing more frequent declines in high value items: It is possible that the declining prices caused many players to panic and sell their items for the minimum price, causing the price to continue falling.
Effect on the EconomyEdit
The effect on the economy was such that many players had sold their items on the Grand Exchange to prevent further economic loss; however, this actually contributed to the snowball effect in that the more items that became flooded on the market, the less valuable they became.
Large-scale crashes are accompanied by panic-selling that makes the crash worse. This is similar to depressions in real life. Many players lost 10% or 20% of their net worth in the panic. However, items affected by the panic reach a far too low price after several days and subsequently are bought out and undergo a rise. In the August 2008 crash, the panic was so great that the subsequent rise in the prices of the affected items caused many of these items to be completely bought out and rise at 5% a day. Some players made millions by investing in items near the end of the panic, right before the rise started. This primary rise is then often followed by a secondary crash and a secondary rise, smaller in magnitude than the primary crash and rise. Eventually items stabilize below their original prices, with the prices reflecting the actual causes of the crash besides the panic.