The Great SL Recession of '04?

Well, um... me? And even if the land they buy isn't mine! RL Realtors do this all the time - it's called acting as a Buyers Agent. It's fun, it's a great way to make good friends with new residents, it heightens your own awareness of the SL geography, it opens the door to a possible custom building business relationship if they settle somewhere, and it sometimes leads to a small tip (less than US$0.50 maybe, but who cares?)

Wow, I can see how you are all about helping people and not in it for the money, Anshe. Thank you for the single most illuminating statement you have ever made. In fact, it shall be my quote! Not everyone is motivated by profits. The fact that you would even make a statement like this shows that you don't care at all about helping any players, new or otherwise.

PS - has Shepp posted in this thread yet? If so it will set a record for the number of alts used to make a point.

Yay Cris! It would be my quote, but I couldn't decide what to cut out of it to reduce it to a new quote size, without losing some of the essence of it.

And, um....

...why would anyone even start showing land for sale to a new resident before they fully understand about tier fees?! To me, that is as important as mortgage pre-approval before house hunting in RL.

ya know, you could get a lower land tier. there are people with no land tier at all playing the crap out of sl. it can be done!

Been saying this for a long time now...

People buy money so they can spend money - if there is nothing to spend money on, people have no need to buy it..

While land was a hot commodity, people were buying money to buy land... If you want low land prices and a high value on GOM - give people things they want to buy.

As for the sky falling - the first time I logged onto GOM ever the price was around $1.00 a block (250 $L) - and would go up and down to around $1.13 - then we had that super spike (around the time people were gouging left right and center on land prices funnily enough) - and now it's gone back down around where it was before.

The sky aint falling yet. It's just settling back to where it was before.

Hopefully the big boom is settling and we can get back to around where we were before - before the profiteers came to visit.

Siggy.

Well this is the first time I have seen the L$ per 250 hit 1.01us on the gom.

not good.

I agree with Siggy. When I started usng GOM, the price was around $1.00L per $250, and went up to around $1.15 on a given day. The spike in value was caused by having to pay huge amounts of money for land. The dumping of L$ by the same people who sold land for that amount offset the high value, and ultimately, the change in the land market could not sustain the inflated prices at GOM either. It's a natural correction, not the end of the world, or a recession.

You of all people should appreciate it, Catherine - this lowers the cost of entry for players to own land and items in SL, and could not come soon enough, as LL gives even less money now to new players, and the cost of items in SL has gone up (anyone price prim shoes, hair, or those creepy skins lately? All very popular, and out of reach of new players without GOM). The only people really fretting over this are Alby and alts, combined with the profiteers who bled money out of SL. The sky is not falling - it is just clear again.

first of all short of LL crashing prices will return after the initial impact of the land flood settles, granted not all the player run away tail tucked between their legs. esp after getting the great deal with the Ebay owner.

Quote:
Originally Posted by Anshe Chung
Who wants spend hours hanging around newbie area and touring some newbie around land, just so that some of the newbie might possibly buy some piece of land you earn half a dollar on? And usually newbie will say "no" once she hear about tier fees.

Lisse Livingston
Well, um... me? And even if the land they buy isn't mine! RL Realtors do this all the time - it's called acting as a Buyers Agent. It's fun, it's a great way to make good friends with new residents, it heightens your own awareness of the SL geography, it opens the door to a possible custom building business relationship if they settle somewhere, and it sometimes leads to a small tip (less than US$0.50 maybe, but who cares?)

first of all dont get so narrow sighted as to think your reason for laying has to match everyone elses, anshe is fully entitled to play to make money for herself, play to enhance others experiences, or play for the hell of it. but she is obviously intrested in making cash and if .50$ US isnt worth her time dont hold that against her.

second yess lisse it is called a buyers representation, and realators have their buyers sign an agreement that states i represent you in your purchase and i will be COMPENSATED when you buy from ANYONE, they dont work for free honey, and neither do any land traders / barrons. also agents dont find people out of highschool and say you wana buy a house? the people come looking for them when they are in the market to buy.

not trying to step on any toes but everyone needs to chill and get a grip, the best way to talk about the issue is to point out problems and offer solutions instead of turning on eachother like i just did

to me i think they should either slow or halt new auctions, but a more effective idea would be to make more auctions (all) linden $ auctions, making them avaliable to more purchasers and causeing more linden to exchange hands and stay out of the sales market

but in essence short of total failure this game will live on the market return and eveyone say you remember the depression of 04? maby it was bush being reelected that set it off!

anyone liquidating their assets IM me in game i am more then happy to reap in your hard work, take your land and sit on my linden return for a month till the market is back

sorry for the spelling and typos, not edited for content!

Cristiano;

Good points but I dont think its a good thing that any player has to buy lindens in order to afford to play sl. Who me old fasioned, old school yeah i can wear that badge with honor LOL. Seriouly with the linden falling so rapidly one would think its not just a correction (even tho I the eternal optimist am now concerned) a resession? Personaly I think the dollar is falling because of supply and demand. Interesting thoughts Cris

Cat

If it dropped to 1.00 for a block of 1,000 I'd say, Yeah, theres something going wrong - but truth be told it's around the value it was before the huge broo-haa-haa over land prices soaring..

At the moment it's a pretty good time for new players - cheap money and cheap land.. Very easy to set yourself up in whatever Second Life adventure you have planned.

I hope things remain like this for a while - maybe we'll see some folks making some kick ass content again.

I remember saving up my first 2 weeks in SecondLife to buy a $500 magic carpet from Buttonpusher Jones -- a pre vehicle code vehicle -- I still have it

Siggy.

ok, so in the 'good old days' (tm) the price varied from $1.00 to $1.15 and back in one day. This is back when there were how many people in SL and how many orders on GOM?
My first memories of GOM not long after it started are that there were mostly 2 or 3 orders at each price point, so it wouldn't take many trades to lift the price by 0.15

Then the block size changes, so in todays terms your .15 movement turns into .60 Yes I'm well aware the 'value' is the same due to increased block size, but is everyone else? Look at the current spread of prices and you see people are trading as if the block size had not changed. This compresses the price movement 4x making it harder for the price to climb back up.

Finally there is the total lack of people willing to buy L$. The computers at GOM don't magically estmate the economic climate and adjust the market prices to suit. WE set the prices buy placing and filling orders and in the past few days the 'wanted' list has got shorter and shorter. Put simply, as old orders are filled no new ones have been put up to replace them. Hence the price has to fall. If this trend keeps up there will be NO wanted orders at all by the end of today, (Friday).

If we are not prepared to buy Lindens then who are we to complain that the price is falling? So far the major 'complainers' have been those that mainly sell. If you need some L$ cheap, then now is the time to buy, you have the market to yourself...

Maybe vendors should consider increasing prices across the board to compensate?

That is a horrible idea - there has already been a negative trend toward higher prices without a match in higher quality. Raising prices just to raise them is lame.

No, the GOM will only go up if we WANT L$, not because we NEED them. There are plenty of people that will give you success stories that don't need L$.

Raising prices will simply reduce sales...

I think thats pretty much what I was getting at.

But I don't think this is the doom and gloom that some are touting it as - more a return after the large (land gouge fueled) spike.... Some folks managed to drive the value up for a time - and now it's going back.

Siggy.

Maybe vendors should compensate by creating/selling things people want to buy... replace the 'must have land' with 'must buy cool stuff'

As for me I've always left my prices low - it's not about the US bucks for me, thats just a nice lil bonus from time to time.

Siggy.

5 pages I was thinking... isn't it true that lindenlabs keeps putting more L$ in the game? if a newbie spends his money, doesn't he get new money each week.? doesn't that mean the value of the L$ drops slowly no matter what?

The Lindens stated last year that the stipend payments (and now dwell payments) come from a Central Bank that is filled from all the L$ drains in-world. Ratings cost L$1, find menu adverts L$30 per week, file uploads L$10 each, plus the land auctions in L$.

The only injection of new L$ is the money created with each new account and so by default in direct proportion to the increase of new users. They don't 'print' money like some RL governments...

OK then I wouldn't worry so much about this depression. I have not much knowledge about economics, but I assume the value of L$ will go up and down like any other market

I'm hoping it will go up again, but what interests me atm is why it crashed yesterday....

Land has been cheap for a while now. The history graph on GOM shows it was stable for 3 - 4 weeks then took a dive last week when the block size changed (or the $8m investment was announced), but it was then stable for a week..

What caused it to crash yesterday to the point of nearly ZERO wanted orders this morning?

At a more recent Town Hall, Philip claimed that both the money supply and the land supply are now tied to the number of subscribers. In terms of money supply, that's similar to what you are saying Surina, but I don't think its quite the "closed pool" that was stated a year ago.

Basically what the Lindens claim that they are trying to do, in terms of managing the money supply and the land supply, is to keep this supply growing at exactly the same rate as the subscriber base grows. If in a one-month period, the subscriber base grows by 10%, then they'll pump 10% more L$ into the economy, and auction off 10% more land in new sims.

Personally, I think this is a good approach, so long as they're able to manage it properly. Land is fairly easy, since they just have to add sims/auctions at a prescribed rate. The money supply is a bit more difficult, since its a combination of stipends, dwell bonuses, and new-user funds creating L$, while its a combination of upload fees, listing fees, and most importantly, auctions denominated in L$ that remove L$ from circulation. I know that they increased the dwell pool a few months ago in an effort to keep this all in balance.

- Ace

You have to bare in mind that with the stated 15% of users as land owners that leaves a possible 85% on the $9.95 one off payment account who only get L$50 stipend, (assuming they log in) and no dwell payments. Only the top few % get a 'large' ratings bonus, the majority get a few L$ or none at all.

So the weekly payout isn't as large as it may first appear and would easily be covered by the current L$ drains.

Giving each new user account L$500, or whatever they get now IS directly increasing the money supply in direct proportion to the number of users... I have seen no announcement anywhere that implies, directly or indirectly, that LL have changed the economic model and so I must assume it is still a closed loop as stated.

Maybe a Linden would like to clarify this.. Do they read threads that are this long?

To me, the question of HOW they manage the money supply is a moot point, so long as they DO manage the money supply. And judging by the slow, but steady increase in money supply, as given to us via Philip's economic stats, I'd say they're doing a good job.

- Ace

Which comes back to the orriginal topic of what is happening to the L$ on GOM. Why is it crashing if the land prices have been stable for weeks and Linden Lab is doing a good job of managing the money supply?