Again, that's true, but that's not how it works if we look at the rules unto themselves; setting price fluctuations based on market conditions is a house rule.
The point was to differentiate between price and value. Fixed price does not change the value to the consumer.
The difference is that those items don't require special class abilities (e.g. spellcasting), specific spells, and item creation feats to make. You just have to make a Craft check (potentially even untrained, for the cheaper non-magical items).
I don't see how that's relevant to my point. A magic sword takes class abilities, feats, and spells, and so is expensive. A suit of full plate takes a whole load of time, skill, and materials, and so is expensive. Both are expensive.
Your argument was that magic items can be priced out of the market. My point was merely that if magic items are priced out of the market, so is mundane equipment of similar cost. If, as a GM, you say "nobody can afford 2000 GP for a +1 sword - nobody has that kind of money around" but you have a ton of folks walking around in 1500 GP armor, the players are going to look at you funny.
This isn't setting any kind of standard, though. You seem to be implying...
I seem to be implying that GM choices cannot be made arbitrarily without cost of plausibility. I asked the question - where does the wealth come from?
If the PCs adventure in urban environments, well, then they're getting their wealth from people in the society. The wealth, then, is present, and you have a long road to hoe in making the "nobody has the cash" appear valid.
So, let's say you want to keep the "nobody has the cash to pay," but the PCs are still hauling in that wealth per the DMG guidelines for treasure. So, how do you make that happen? Strict dungeoneering adventures, so you can say that all that wealth comes from past civilization? Okay, that's fine.
You know what you call a high-risk environment loaded with valuable resources? A mine. Humans have gone to the risk of digging out mines at great risk to themselves. Maiming, death, permanent disability were all pretty common in past mining operations. So, why don't the locals mine it?
Um... maybe they don't know the stuff is there? Okay, so how do the PCs manage to have an entire 20-level career of finding greater and greater troves that *nobody else* knows about?
Um... maybe they aren't up to the challenge. The PCs are super-special, the only ones around with class levels to do the "mining". Well, then, you have to explain how this group of very special people, the only ones in the world (or near to it), happened to all come together in the same place to adventure. Oh, and you probably can't plausibly use many or any surface-dwelling races as antagonists, or you'll be breaking your own conceit. Oh, and if the dungeon-dwellers are *sooo* much more powerful than the surface dwellers, how come they haven't taken over the surface? They have all this gold and magic to use....
You certainly can make a consistent game world where there really is no market for magic items. But you have to answer a ton of questions in order to do it.
In other words the "guidelines" that you say this deviates from are an interpretation of what's in the books, rather than being what's in the books themselves. Monsters with treasure (which is, unto itself, out of the market, since the monsters aren't spending it) doesn't imply or equate a magic item economy.
That's another great question! Why aren't the monsters spending the cash? Do you have *no* monsters that make the connection that, "Hey, I have tons of money! Why don't I just buy some stuff to make my life better?"
Simply put, I disagree with the notion that the nature of d20 magic items (in their price and cost/method of creation) necessitate a magic item economy, unto themselves.
Well, that's fine. I'm not arguing that. I'm arguing that stipulating no-magic-item economy has a *TON* of repercussions if you want the world to be vaguely plausible. I'm saying that the stipulation implies a whole lot of world-building work on the part of the GM. Given the rules in the book, that stipulation comes out like playing Twister.