SL Stock Market

I was playing with the idea of starting a Stock Market - it'd almost HAVE to be in Americana - to capitalize new business ventures and provide the opportunity for investors to share in the success of existing businesses. As far as I can see, the idea is pretty much unworkable; the recordkeeping alone would be a nightmare. Maybe someone else can help come up with some more practical and/or workable ideas.

This is a very interesting project. I am SO not a businessman and I only have a lay person's knowledge of the stock market but here is my thoughts

- The money people make has to come from somewhere in SL. If there happened to be something like a split and everyone in SL got a lot of stocks from it and they all cashed out, there wouldn't be enough cash to pay everyone.

- The changes in the stock values is entirely influenced by people's buying and selling, is it not? Currently there is no information source in SL that would give people a reason to buy or sell a certian companies stocks. How would you know about a new company? How would you know about a bad thing happening so you could sell? etc...

Some kind of an advanced lottery where payouts are based on ticket sales might be a good start. Maybe a real business person can be more helpful

You will be very interested (I hope) in some announcements I will be making this Friday - July 25th.

Ama, you are a poot!

Spill it, and spill it N.O.W.!

=)

Well, the main problem I saw is that the larger business concerns are all retail and construction oriented - in other words tied up with a bit of talent on the part of the owner. First of all, how do you fix an honest appraisal on the value of an SL transportation company or store? If the proprietor suddenly drops out of the game - poof! There goes the business (and all of the investments) if careful planning isn't done. Still, there could be some way for a purchase or sale of a set valued percentage ownership in a firm, with a fee for the broker figured in. If someone wanted to cash out, they could sell their stake privately, through the exchange, or back to the firm. I am looking forward to seeing more ideas in the future!

And spoil all the anticipation?? Aww #!, cmon now I can't do that.

I know replying to my own post is bad form, you didn't think I got 1k posts legitly did you?

Anyways. I wanted to clerify that what I am working on and will be announcing is tangental to this topic but in no way solves or addresses what is being asked in the first post. I re-read my reply and realized I was not clear.

My project is on the theme of Stock Market but will not be a way for projects to get funds and split profits among interested parties etc. That would be great, but the paperwork involved makes me think heavy linden work is needed to make it work smoothly and reliably. And it would probably rely very much on the group features they have mentioned for 1.1. Which means it won't happen for quite a while.

Still worth discussing though. What kind of systems would need to be in place to make it all automated? Where sales are tracked, stock value tracked etc.

Setup:

1. We would need to be able to form corporations.
   
2. Corporations would need to have accounts that existed separately from avatars' individual accounts. CEOs/CFOs/etc would have to sign for any drawing of funds against corporate accounts.
3. There would need to be a way to boot any executives who are idle, unresponsive, or who violate the corporate Charter.

For each corporation:

1. It would be necessary to set up accounting constraints. In the case of bonds, look at the financial report for any corp that issues them. You'll see that one of the first limits they put on revenue is repayment of bonds.
   
2. Capital stock is different. You cannot force a corporation to redeem stock at market value, but you can sell it to other traders. If none are buying you are SOL.
   
3. Shareholders would have to have representation on the corporate board. They would have to be able to propose initiatives and call votes. If a majority of shareholders vote yes on something, it has to be done. Thus, the corporation belongs to the shareholders, not just the executives.
   
4. The corporation would have to hold regular board meetings, so as to involve investors in the decision process. Shareholders have a right to know what is going on in a company and management has an obligation to make business decisions that encourage the stock price to rise.
   
5. Bondholders do not normally have any say in the operation of a business since they are creditors rather than investors. This may be a better model for corporations who wish to keep true to a vision and are afraid of hostile interference from shareholders.
   
6. A dividend control and automatic payment system would need to be implemented.
   
7. Insider trading would be difficult to control, if not impossible.

There may be other ethical issues that need consideration, but right now I'm out of caffeine and ideas so I will leave that to someone else.

From what I currently understand, 1.1 will allow group ownership of objects, land and cash; that's one of the factors that led me to ponder the problem. If so, we will have other options to the current loosely organised Limited Liability Partnerships and Joint Stock Companies that some of us have found variously satisfying, annoying and disastrous.