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What if... the Linden dropped to 400 to the USD?

ReserveBank Division
Senior Member
Join date: 16 Jan 2006
Posts: 1,408
03-04-2006 04:47
The vote is now:

Effected: 22 Votes
Not Effected: 15 Votes

Could Care Less: 14 Votes




It has been determined, a major drop in the valuation of
the Linden Dollar would be disasterous for Second Life....
So Sayeth the Majority...


Time to cut the Stipends and get the L$ on the rise...
_____________________
Jonas Pierterson
Dark Harlequin
Join date: 27 Dec 2005
Posts: 3,660
03-04-2006 04:52
so sayeth the majority:

cut the stipends cut the premium fees
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Michael Seraph
Second Life Resident
Join date: 9 Nov 2004
Posts: 849
03-04-2006 12:28
From: ReserveBank Division
We need to be looking
at the available Money Supply which LL keeps under lock and key
because they know such knowledge would only confirm my rants
that SL has a glut of Linden Dollars in float.


From: ReserveBank Division
The problem is more L$ is being poured in than getting
taken out. The result is more L$ for sale on LindenX which leads to
declining valuations.


So, you don't have the facts (because LL is conspiring to personally make you look bad)? But you confidently claim to know just what the problem is.

I know, I know, I'm a lazy communist welfare addict. I hope that will save you a minute or two of your valuable time so you can get back to studying the data you don't have to come to the conclusions you can't support.
Michael Seraph
Second Life Resident
Join date: 9 Nov 2004
Posts: 849
03-04-2006 12:41
From: ReserveBank Division
The vote is now:

Effected: 22 Votes
Not Effected: 15 Votes

Could Care Less: 14 Votes




It has been determined, a major drop in the valuation of
the Linden Dollar would be disasterous for Second Life....
So Sayeth the Majority...


Time to cut the Stipends and get the L$ on the rise...


What majority? Now I know you can't read basic data. Affected and Not Affected? The data clearly shows (at the present)

23 Will be negatively affected

16 Won't be affected

16 Will be positively affected

That means if the $L drops dramatically, 42% would be negatively affected. 29% wouldn't be affected at all, and 29% would be positively affected. When did 42% become a majority? LOL. 58% would be unaffected or benefit from the drop. That means that 58% (a real majority) don't see a need for your mucking around with the monetary supply.
Maxx Monde
Registered User
Join date: 14 Nov 2003
Posts: 1,848
03-04-2006 13:04
55 Respondents seems awfully low to make any kind of inference.

But, let the drama continue!
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ReserveBank Division
Senior Member
Join date: 16 Jan 2006
Posts: 1,408
03-04-2006 13:36
From: Michael Seraph


I know, I know, I'm a lazy communist welfare addict.




Thats what I've been telling you all along... :)
_____________________
ReserveBank Division
Senior Member
Join date: 16 Jan 2006
Posts: 1,408
03-04-2006 13:37
From: Maxx Monde
55 Respondents seems awfully low to make any kind of inference.

But, let the drama continue!




I demand a recount. Voter fraud... The Socialist are padding the
the numbers..
_____________________
Shaun Altman
Fund Manager
Join date: 11 Dec 2004
Posts: 1,011
03-04-2006 13:56
I voted for:

"enjoy SL a whole lot more, with increased spending power."

I voted for this mostly because it was the only one placed in italics, so it was more able to grab my attention than the others. :) But, also because it's true. SL would be MUCH more enjoyable if the rate per $1.00 were L$361.11 or higher.
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Fund Manager
Metaverse Investment Fund
Stephen Teazle
Jesse Camp stole my gf
Join date: 30 May 2005
Posts: 31
03-04-2006 14:47
From: ReserveBank Division
Only if there is incentive (ie: Economic Loss) to force people
to raise prices.. Except in SL, the widgets people sell cost them
nothing to produce. So they will not incur a loss if valuation of
the Linden Dollar declines..


You're looking at the marginal cost and saying it equals a producer's total cost? Uh, how did you get that? You might as well look at Microsoft's marginal cost of creating software and come to the same conclusion. Anyone who produces something that's sold as bits (software, music, etc) has a marginal cost of zero. That's very different than what their total costs are though I thought that was fairly obvious. I mean even if people make stuff on here for fun and sell it there's still opportunity costs.
Jopsy Pendragon
Perpetual Outsider
Join date: 15 Jan 2004
Posts: 1,906
What's it worth to you to stabilize the LindeX?
03-04-2006 15:37
I'm a premium user, and enjoy getting a crisp newly minted L$500 billl every week.

Sure, I suppose I wouldn't care if that L$500 was previously owned and bought via
the LindeX with some of my premium fees... but doing that will certainly cut into
Linden Lab's revenue. Should they charge premium accounts MORE so they can
buy the stipends for them? *maybe*

Perhaps LL should raise all premium accounts by US$1 a week... and buy US$1 worth of L$'s off the exchange and then mint the remainder of the unpaid L$500 stipend.

When the L$ is strong... LL is minting a lot more to cover stipends.
When the L$ is weak... LL mints fewer L$'s to bring the stipend up to L$500.
Heck, if the L$ is so weak that US$ buys more than L$500, perhaps they should just
keep the stipend at L$500 and take the extra out of circulation.

For no-pay basic accounts and dwell pay out? Pay for those out of the pool of
Lindens taken out of circulation each week. Split the pool in half. One for basic
players, one for dwell income. Divide the L$'s among the basic players that have
been active in the last week. If the weekly variable stipend falls below L$20 each,
mint enough to bring it up to L$20. If the pool is greater than L$50 per active
basic account, then only give L$50.

So... premium account holders... is it worth paying US$52 more a year to take
what could be a powerful step towards stabilizing the economy?
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elka Lehane
WOWAWIWA
Join date: 30 Mar 2005
Posts: 983
03-04-2006 15:58
All I have to say is:

BEST
POLE
CHOICE
EVER

...

the starax wand thing, hahahaha, whew, boy did i laugh
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Shaun Altman
Fund Manager
Join date: 11 Dec 2004
Posts: 1,011
03-04-2006 16:37
From: Jopsy Pendragon
I'm a premium user, and enjoy getting a crisp newly minted L$500 billl every week.

Sure, I suppose I wouldn't care if that L$500 was previously owned and bought via
the LindeX with some of my premium fees... but doing that will certainly cut into
Linden Lab's revenue. Should they charge premium accounts MORE so they can
buy the stipends for them? *maybe*

Perhaps LL should raise all premium accounts by US$1 a week... and buy US$1 worth of L$'s off the exchange and then mint the remainder of the unpaid L$500 stipend.

When the L$ is strong... LL is minting a lot more to cover stipends.
When the L$ is weak... LL mints fewer L$'s to bring the stipend up to L$500.
Heck, if the L$ is so weak that US$ buys more than L$500, perhaps they should just
keep the stipend at L$500 and take the extra out of circulation.

For no-pay basic accounts and dwell pay out? Pay for those out of the pool of
Lindens taken out of circulation each week. Split the pool in half. One for basic
players, one for dwell income. Divide the L$'s among the basic players that have
been active in the last week. If the weekly variable stipend falls below L$20 each,
mint enough to bring it up to L$20. If the pool is greater than L$50 per active
basic account, then only give L$50.

So... premium account holders... is it worth paying US$52 more a year to take
what could be a powerful step towards stabilizing the economy?


This is an interesting idea. Maybe instead of a fixed stipend you should simply get $4.00 worth of L$ though.. let the stipend amount swing wildly along with the currency valuation. :)
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Regards,
Shaun Altman
Fund Manager
Metaverse Investment Fund
Fade Languish
I just build stuff...
Join date: 20 Oct 2005
Posts: 1,760
03-04-2006 16:48
From: Stephen Teazle
You're looking at the marginal cost and saying it equals a producer's total cost? Uh, how did you get that? You might as well look at Microsoft's marginal cost of creating software and come to the same conclusion. Anyone who produces something that's sold as bits (software, music, etc) has a marginal cost of zero. That's very different than what their total costs are though I thought that was fairly obvious. I mean even if people make stuff on here for fun and sell it there's still opportunity costs.


Yes!
Sebastian Saramago
Common Brilliance
Join date: 25 Sep 2005
Posts: 62
03-04-2006 17:07
From: Karsten Rutledge
You left out the most important option:

"Raise prices to adjust for the inflation and carry on."

That's what happens in economies. If the value of currency goes down, the price of things go up.


That's why its 50,000 pesos for a cup of coffee in Mexico
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Einsman Schlegel
Disenchanted Fool
Join date: 11 Jun 2003
Posts: 1,461
03-04-2006 17:12
*Sits and watches the..... economists... hash it out*
ReserveBank Division
Senior Member
Join date: 16 Jan 2006
Posts: 1,408
03-04-2006 17:32
This is a present for Toy, Mike, Jonas, and the rest...

_____________________
Jonas Pierterson
Dark Harlequin
Join date: 27 Dec 2005
Posts: 3,660
03-04-2006 17:50
Reserve..when you've learned how to properly understand the difference between welfare and a paid for stipend, Ill look at your link.
_____________________
Good freebies here and here

I must protest. I am not a merry man! - Warf, ST: TNG, episode: Qpid

You killed my father. Prepare to die. - Inigo Montoya, The Princess Bride

You killed My father. Your a-- is mine! - Hellboy
Toy LaFollette
I eat paintchips
Join date: 11 Feb 2004
Posts: 2,359
03-04-2006 17:51
From: ReserveBank Division
This is a present for Toy, Mike, Jonas, and the rest...



Not worth a reply..... Troll elsewhere
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ReserveBank Division
Senior Member
Join date: 16 Jan 2006
Posts: 1,408
03-04-2006 17:55
From: Jonas Pierterson
Reserve..when you've learned how to properly understand the difference between welfare and a paid for stipend, Ill look at your link.



You've paid for nothing, when will you learn...
_____________________
Jonas Pierterson
Dark Harlequin
Join date: 27 Dec 2005
Posts: 3,660
03-04-2006 18:03
I pay premium partly for a weekly stipend. When will you learn?
_____________________
Good freebies here and here

I must protest. I am not a merry man! - Warf, ST: TNG, episode: Qpid

You killed my father. Prepare to die. - Inigo Montoya, The Princess Bride

You killed My father. Your a-- is mine! - Hellboy
Michael Seraph
Second Life Resident
Join date: 9 Nov 2004
Posts: 849
03-04-2006 20:06
From: ReserveBank Division
This is a present for Toy, Mike, Jonas, and the rest...



I am a capitalist. Representative democracy and market capitalism are the best systems man has yet come up with to run society. In fact, my insistence that you have at least a few facts before you demand that LL intervene in the economy to prop up the currency isn't just capitalist, it's conservative capitalist.

Elimination of the stipends would cause an immediate shrinkage of the available capital. No one who has advocated the stipends' elimination has proposed a way for more money to be added to the system as the economy and population grow and as money flows out of the system through direct $L payments to LL.

If any changes are needed (show me the data, not your opinions) then any action taken by LL should be gradual and restrained. Subtle nudges and not radical economic restructuring. Minimal intervention if and only if absolutely necessary. Wide ranging prim taxes and dramatic reductions in the money supply could easily have unintended side effects.

If all that sounds like socialism to you, I'd suggest a basic high-school social studies text to help get you up to speed.
crucial Armitage
Clothing Designer
Join date: 30 Aug 2004
Posts: 838
03-04-2006 20:46
From: ReserveBank Division
But everybody else who doesn't keep tabs on the exchange
rate wouldn't know about the valuation change, nor would they
care because their cost basis is still zero.

They might get less USDs for their Lindens in they sell them.
But what incentive do they have to raise prices if every linden
dollar they earn is pure profit?


this is absolutely not true every linden i make is not pure profit i personally pay 295 us $ a month in tire and pay rent in linden $ at dozens of malls so not 100 % of what i sell is profit its quite a bit less i try and keep a good cost of doing business % but that percent is not %0
nor is the cost of doing business 0 for any one if you own land you pay tier if you don't you most probably are renting space. if some one can tell me how i can get a 0 % cost of doing business please let me know i be happy to listen.
Fade Languish
I just build stuff...
Join date: 20 Oct 2005
Posts: 1,760
03-04-2006 22:47
From: crucial Armitage
this is absolutely not true every linden i make is not pure profit i personally pay 295 us $ a month in tire and pay rent in linden $ at dozens of malls so not 100 % of what i sell is profit its quite a bit less i try and keep a good cost of doing business % but that percent is not %0
nor is the cost of doing business 0 for any one if you own land you pay tier if you don't you most probably are renting space. if some one can tell me how i can get a 0 % cost of doing business please let me know i be happy to listen.


And don't forget to factor in the value of time spent creating an item for sale.
I hate this notion that there's no cost. Like our time, skill and effort is worth nothing.
Karsten Rutledge
Linux User
Join date: 8 Feb 2005
Posts: 841
03-05-2006 01:29
From: Sebastian Saramago
That's why its 50,000 pesos for a cup of coffee in Mexico


I didn't necessarily say it was a good thing, I just said it's what happens. It's already happening in Second Life. Despite what Reserve thinks about there being no incentive to raise prices, there is plenty of incentive. Even if there's no production cost, businesses here do have costs in other forms. Development of new products takes time, sometimes a lot of time. Sometimes a lot of cost, too. L$ being burnt on upload fees or subcontracting is development costs, it's USD you won't be bringing home. Customer service takes time away from development or other things. For people who make their living off of Second Life, the incentive is bringing home the same amount of USD every month, and that means they have to raise prices to get the same cashout. Even for the hobbyist business owner in SL there is tier to pay. If the economy sinks enough that the L$ they were making before isn't cashing out to cover their tier anymore, they have to make more L$ to keep their tier up.

The incentive exists, and it's already happening and will continue to happen. Good, bad, indifferent, it's still happening.
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Patch Lamington
Blumfield SLuburban
Join date: 2 Nov 2005
Posts: 188
03-05-2006 03:15
From: elka Lehane
All I have to say is:

BEST
POLE
CHOICE
EVER

...

the starax wand thing, hahahaha, whew, boy did i laugh


Thanks, I had a good chuckle myself at that one :)

If the answers are honest, then there appear to be some residents who would still splash the same amount of USD into the game overall - hence at a lower rate would be buying and spending more Lindens. Supporting either/or/both higher prices or increased sales. For *some* vendors lower USD per item could be offset by higher volume.
All of this is arguable - my crystal ball is on the fritz.
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