Linden Dollars continue to fall! GOM take away the new "Sell at best Price" option.

I don't know if that is a valid reason for the Linden Dollar falling but; I will say this...when GOM first implemented the new "Sell at Best Price" option, common since tells me that most will obviously pick it. Such is the result and I think it will probably continue to fall; but, that will only force inflation and people to raise prices if Secondlife income is an issue.

It may not matter to them or not, because they make money on selling in Bulk units, but; it may comeback and haunt them in the long run.

Best Regards
Blake Rockwell.

You're not the only one to notice that the L$ started to fall (more steeply than before) when GOM introduced the new selling features. I'd agree that it seems to force the value of the L$ lower that it might have been with the previous system.

I agree of course, GOM is a Pacesetter of the Linden Dollar. Its just going to cause inflation. If inflation doesn't kick in, then; quality will go down, because iam certainly not going to spend hours on an Avatar and not be compensated approprately..id just soon hang out with a friend and talk about the weather. Work is work to me, period. And customer service is work.

The new GOM system certainly puts the power in the buyer's hands. You'd think that would stimulate people to buy, but I have no idea how economics work. I do know that I am probably not alone in being pessimistic about this sytem since the price has never truly recovered since the "2 million $L dump" and this weird change to a system that was perfectly fine before.

And, on an aside, I really dislike this system because it spams up my mailbox as I sell one measly block at a time. I like knowing when my $L sells but certainly not one block at a time.

/shrug

LOL! Exactly!

Hopefully more sellers will start putting up their blocks at a set price instead of using the sell instantly feature. Before partial fills, having to find appropriate block sizes to buy or sell acted as a brake on the market and kept most of the power to set the price in the seller's hands, depending on how they split up their blocks and what block size buy orders were there to be filled. Now the brake lines are cut and we seem to be speeding headlong into a ditch. Buyer's now seem to set the price. People really need to start being smarter about how they sell and resist the temptation to sell instantly. If the market is determined by what people want to pay for L$ it will keep going down until it hits zero. Who wouldn't want free L$?!

Ever thought of changing your name to George Bailey, Chip? That's good advice. If more people would be willing to sit on their Lindens for a bit and sell them for set price then sooner or later the ones looking to buy Lindens immediately at the best price would start having to get their orders filled with those blocks waiting for them at the higher set price.

But this would take patience from everyone. Hopefully we all won't be running down the street to cash out instantly at Potter's!

Sounds to me like Governor Linden needs to put Monetary Policy in place and QUICK! Today my prices go up.

It does stimulate people to buy- at lower prices. People can't sell small blocks at "conveniency" prices anymore.

(Not sure if this is working. The chart isn't showing up in the preview...)



Line 1: Upward trend that started towards the beginning of January.
Line 2: Downward trend that started about half way through April. This trend has not broken.

Arrow: Partial fills were introduced around here.

I just don't see how people are drawing the conclusion that partial fills are the source of the price drop. Seems like a bit of stretch to me.

Jek

If Chip can be George, can I be that hot chick that would have turned bad without George's help?

as an expirament, 2-3 weeks ago i drove the price of linden up 10 cents in 2 days, and no i didn't do it by buying out all the blocks, i just 'nudged' it to see if it was possible (aka didn't let small 'cheap' sell orders sit there and drag everythin else down.. also used selling of my own lindens, or rather the withdrawal thereof when it came, to drive it up, a penny at a time

and it worked... so i duno if thats encouraging or not... it just takes one person with a little motivation, to pull up the entire market, or to tank it... the real issue is GOM is *NOT* a very good system for SL, its a good system for day trading... SL needs a system which charges higher prices but is trivially easy to use, in game, hank ramos had one like that... sold for up to 50 cents to 75 above GOM's price

but hank couldn't stock with $L fast enough to keep it afloat, its like RL, you can go to a teller and get your cash free, or your specific bank, but most people will pay the $1.50 atm fee to get their money *there* right *then*

Have to agree with Jekyll on this one - partial fills and the ability to sell at market are simply liquidity enhancements that technically do nothing to change price or price direction. Sorry, but it just doesn't work like that in RL or in SL.

Selling pressure is what is dropping the price of the Linden - pure and simple. That may well be the result of a LL decision to stop its support of a target price, or it could simply be that large landholders are converting Lindens to Dollars to pay for tier. Who knows? Could be either or a bit of both...

Its not GOM's fault - they are only an exchange, not a market maker (which means that they hold no Linden inventory and do not trade in the market as a principal on either side of the transaction).

So this is just more idle speculation as far as financial markets and economic principles are concerned...

This is the second time GOM changed format and lowered the L$ value. FOr them it does not matter, they are still making the same amount per block as they were before they made these changes. I think if GOM is going to make the market value decrese by implementing changes, they should at least lower the price per block sold that they charge us.

Get a grip!

Inflation happens when you increase prices - not when a currency value fluctuates against other currencies.

So there is no inflation in SL unless you decide to raise prices, for whatever reason. A Linden is still worth a Linden today as it was yesterday, and will be tomorrow.

Inflation can only be forced in-world by an increase in the (Linden) price of a factor of production - such as land, or prims. Since that does not affect most products for sale in SL even increases in these factors would likely not cause inflation in-world.

Demand-pull price increases are completely avoided in digital goods markets since they are so easily copied/produced and no one carries inventory. The hottest product in SL has a virtually flat supply curve at any given price. So there is no reason for in-world inflation from everyone wanting the same thing in SL.

If you lose confidence in the Linden then thats a different issue - but pegging in-world prices to Dollars is simply saying that the Linden has no real value in SL, nothing more.

since most people who are high on the currency market pyramid tend to be people selling lindens, for tier fees, the cost of the linden against the us dollar is definately something that will affect things..

...and the price has plunged over 10 cents in the last hour...

This means it's a good time to buy L$, and then cash them back out (slowly of course) when the market recovers.

It looks like a single person chose to bork the market. Probably the same person who sold to all of those single unit orders on the "Wanted" side to buy it out a few days ago.

Eltee????????????????

No, kidding - I know it wasn't you! But yes, for all the left hand orders above $3.50 to disappear in a matter of minutes looks like the work of one person.

I predict it will be back to a nice equilibrium by the end of the day, though.

The economy will stabilize itself, so stop panicking. GOM provided the SL community with a good reliable service. They are here to stay. Get used to it. I'm sure the economy will continue to fluctuate and stabilize many more times as SL continues to grow.

That's what I was thinking. The average SLer isn't selling Lindens--they might buy L$s occasionally, but I would guess that many, like myself, never hit GOM at all. This currency fluctuation might drive up the price of import goods/services (i.e. produced by people whose main goal is to generate USD), but for smaller merchants operating almost entirely within the SL economy, the L$ can trade at $.02 US or $20 US, and it will only influence their degree of temptation to start day-trading.

Get a grip? I didnt see anyone panicing. I just made a statement about GOM constantly changing the block format.

Chill Out!

If you check in and watch the market a few times a day, it's quite easy to see what is happening. For a couple of weeks after the change at GOM, the price was very, very stable, somewhere around $3.85. During that period, there were plenty of buyers and sellers on either side of that price. If one person came along to buy or sell a large number of lindens, the market easily aborbed their big orders. The spread between the daily high and low was routinely $0.02-$0.03. The daily charts were practically straight lines on most days.

At the end of last week, orders in the "sell now" column simply dried up. There was 10 times the amount of lindens for sale in the "buy now" column. That's why the price fell. All it took was a couple of people wanting to cash out a large number of lindens and the price went in the toilet for a while.

As long as there are plenty of poeple who want to buy lindens, the price will remain stable. If not, it's going to drop, and nothing that GOM does can stop that. Everything that poeple are noticing (about how the system affects buying and selling behavior) would work in the exact opposite direction if the buy pressure picked up and started moving the linden higher.

Thanks for that, Jek. It helps a lot being able to see the bigger picture... not that it's a pretty one!