Vasudha Linden - "the economy does not need stipends to sustain it.”

I never see most of my money (savings) in RL. I get paid via wire transfer, I pay for product/services with wire transfers and credit cards (and okay, a bit of cash).

I have NEVER seen most of my real money in physical form, just in the form of 'numbers on a bank paper or on screen'.

Compare:
US$ = money numbers on screen with internet banking, (coming from a database)
L$ = money numbers on screen (coming from a database)

No. Actually, that is REAL money. Just because it's not a piece of paper or coin, doesn't mean it's not money.

"Cyberspace is where banks keep your money."

Peeeeople! Second Life is Peeeeeeeeople!

ok Thank you for that info. If you'll reread my posts on this I wasn't trying to post info except for the dictionary definition. I was posting my thoughts. While barter is taxable by law it still does not change the definition of the word barter. It is not, by definition, money.

Also, while the rest of your post was informative for those who do not know about the laws regarding not reporting, it is beside the point I was making in regards to the definition.

lol I am just the opposite. The vast majority of my transactions are done by cash or check. Mostly cash. I have to pay cash for the gift cards I use in leu of credit cards. I don't have to pay all the interest charges either. Just the 3.95 USD for the card plus whatever amount the card is for. Computers were still monster sized and an expensive luxury when I was born. lol Guess I'm still kind of stuck in the "dark ages" in that respect. But it works well enough for me.

You must not have gotten the joke.....

Being a mentor/Greeter is important for me to getout in tot he world exploring and looking for places of interst and object referance for newbies/ and otehrs that needs help.......... But this one instance really made me take anotehr look at the forces that drives these promo shop devices..
I thought MAYBE LuckyChairs was going to help out people. Well Its turning out some owners of these items are just getting as fight fisted as they say as with other promo goods owners are offering. Mind you not all of lucky chair owners but only a few putting a damper on the growth of them. I for one will not sit in them anymore after one owner ranted and cried and insulted me after a telling me it half of a brain piece of mine to me. Gesh I tell you what is this game coming to?! If its quility things? I say its a bitching about the occurance what happened to me is allowable. But this person items after looking aroun the place is not even close to worth the while....... Oh yes i failed to tell you.....this person has copywrited named images and objects in it shop. If this person was not so protective of its items( let alone this person is stealing copy written image ) i would`nt say a word. But Gesh bitching about me and then turning around selling copywritten products with images on them? Some people just need tol earn that stealing copywritten images and selling them then crying foul does not go hand in hand.......
Well I gave one object back and delete a non trans item as well. this person will not get any refer to its shops thats for sure! greedy greedy
TO add on to this story.......this person took its add off the find listing .this alone seem to be the case that this person onkly used this lucky chair to trap people in its shop they stop using it as a promotional tool. Gesh nothing worse then a person using/tricking people for their use. Again COpywritten images are in this shop. Well it seems stealing is the name of the object makers game now adays..... SAD SAD SAD!........scum always settles on the bottom of a week old water. IF ALL ELSE FALSES YOU CAN`T CREATE STEAL ANOTHER PERSONS DESIGN Case in point withthis person...........Welcome to the new Second Life. where copy written objects are allowed.

I will be the first to say it, "WTF Did the person above me just say?"

ANYWAY, as someone who always purchased Lindens because I never really created any content (my content was laughter remember) I had no problem doing and buying what I wanted in Second Life. However when I became a Greeter and met new resident after new resident who did not have the luxury to buy Lindens nor the inclination to spend hours creating content, I saw the absolute need for stipends.

Second Life has to be a place that is inclusive of those who just want to be here and socialize and enjoy themselves and NOT spend money. I think one of the things SL has going for it is that people can join for free but still end up being fantastic contributers to our community.

While I will be the first to admit I have no grasp on how the SL econimy works, I just do not see how continuing to give stipends has any negative impact.

ReallyRick...Coming Soon to a Sim Near You!

This thread is growing faster than I can read it, and I've got stuff to do tonight, so I'm just gonna go off half-cocked here:

Dear Linden Labs,
Please don't take away my free money. I like free money, even pretend free money.

Sincerely,
~Justy Reymont~

I am currently starting my first business in SL. I know a lot of business owners are upset right now, because their $L are worth less now than they used to be a year ago. But I'm very gradually starting to make a profit, even with the exchange rate just under L$300/US$1, so I would posit that the current exchange rate is not killing businesses, or making it impossible to DO business. It IS making some EXISTING businesses less profitable than they USED TO BE, once upon a time. But there are lots of RL businesses tightening their belts now. Why should virtual businesses be exempt from unpleasent realities and uncertianties?

Is the current low exchange rate a recession? Or was the older, better exchange rate an unrealistic, unsustainable bubble?

Maybe it's a little bit of both, I dunno. But I don't think it's nice to penalize new players so that the Old Money can cling to some unrealistic idea of what SL will earn them in a month.

That said, kill off the stipends (I'm talking about at the free level, here, not tier stipends which I THINK you're smart enough to realize are part of your product, and a cost you have already factored into the tier rates) and you kill off new blood. All that trouble you went to to attract new players, first making the game itself free to play, then adding the $L50/month stipend, will be undone, and new players will log in a Joe Whiteshirt, be unable to create anything or buy anything with no $L, get bored, and quit playing. You'll have a tight-knit community of diehard whiteshirts with no money, a small group of land barons squabbling amongst themselves for each others' RL$, a very few select people who honestly enjoy pumping US$200 a month into the game just to maintain a cool virtual private estate.... and everyone else will just throw up their hands in disgust and leave.

That said, maybe you want this. The gamers en masse abandoned ActiveWorlds for There, and then they abandoned There for Second Life, or at least that's my vague understanding of the recent history of People-Who-Like-to-Play-These-Kinds-of-Virtual World-Thingies. ActiveWorlds and There are still both limping along, even though SL has taken over their playerbase by offering an arguably superior product. But they're still in business, so presumably, they're still profitable. Sure, they're charging money for stuff that SL's currently giving away for free, such as the ability to create content, but they're still eeking by. They're not growing tremendously, but a few big spenders are apparently keeping the server farms paid off, with a little cash leftover for salaries.

Maybe that's what you're after. Heck, maybe it's the best that can be expected.

It'll certianly be the abrupt reality, when and if some new Virtual World eventually comes out, with sexy DOOM3-style vertex and pixel shaders and occlusion or zoning of some sort that makes the world load area by area instead of flushing your cache every time you turn 180 degrees. When and if that happens, all the fair-whether freebie players will probabaly do what they've been doing since the begining and migrate to the new cool toy. It happened to those other two "innovative, next-gen virtual worlds." Why couldn't it happen to Second Life?

Frankly, I think we're already past the "crazy big boom of money" phase of SL, (though that's just the guess of some guy who plays video games a lot and has no economic background.) I just don't see any reason to hasten the progression further, from "fun free online game lots of people are interested in" to "static, lifeless ancient virtual world with a monthly fee like twelve people still pay. But man, if you have a free weekend, you should check out some of their long-since gone-static creations!"

No reason to hasten the progression, that is, unless Linden Labs itself is currently LOSING a lot of money hosting the whole thing and paying salaries and hoping for some magical windfall that was projected last year but doesn't seem to be materializing. But, hey, they're based in California, the Level-Headed Business Plan State, so I think we can discount that idea.

Everything I've just said is opinion, and not only is it opnion, it's based on mere conjecture. So please don't take me too seriously. It's just my two cents.

This thread just won't go away. My economic advice on the topic is to kindly accept the fact that the economy does not need stipends to sustain it, and let this thread go. LL's resident economist has run the numbers. The fact that YOU may "live on stipends" (whatever the heck that means in a world with no real need for money) has no bearing whatsoever on the overall economy.

Those who desire a premium Second Life existance should be fully prepared to pay a premium for it. Those who do not desire to pay a premium should expect only a basic service, with limited features such as "chat", and not much in the way of premium features such as resident developed content and services.

Nice try!

This whole discussion just goes to show a principle that is well established in RL politics: Be very careful if you ever introduce any kind of subsidy. Its just too hard to take it away later. No matter if the original reasons for introducing them are long since gone, you will allways provoke an uproar of angry protests if you ever only so much as talk about killing them.

No matter how good your - or anyone elses - arguments against stipends might be, you will find lots of residents arguing against their removal. They will offer lots of plausible reasons for it.

We humans are very good with rationalizing that we need - or that it is for the common good - what we want.

Lindens Labs just needs to create some sort of balance. Stipends, Dwell bonuses, etc/per person = money sinks, upload fees, etc/per person.

Actually we don't know that she's read the numbers - if you read the MM interview there's lots of "I don't have the data but I think..." type comments. That is certainly the case on this particular topic.

Despite a fair number of people requesting a look at her data, either her state of the economy report, the summary data she uses, even all of the raw data with tokenised id's we've not seen any of it.

We've also asked about what model of analysis she's using - and pointed out that any RL economic model will have some problems because SL doesn't have a comparable economy to any RL situation we can think of - where else do you find an economy that is 100% luxury based?

Of course LL can, and history proves will, do what it likes but saying the economist has run the numbers is not what was reported and not what Vadusha's personal posts suggest either.

I'm not making an argument against stipends, I just said that the argument is over and now it's time to let it go. I have no arguments for or against stipends whatsoever, personally. I've stated this many, many times.

I would take a different approach than eliminating welfare, if it were me. I'd simply leave the welfare in place but allow it to run it's course and let inflation set in, rendering the welfare almost useless. That said, if LL has looked carefully at the data and decided that the economy does not need stipends to sustain it, that's fine by me too.

I feel that this personal indifference to the welfare issue in general gives me solid ground to stand on, when I say that I am solidly in support of Linden Lab OR, preferably, residents, taking whatever steps they feel will bring us out of this depression as quickly as possible. Linden Lab does have access to a lot more data than we do, though.

What is SO CRITICAL though, is just that SOMETHING changes. Either the exchange rate must rise (probably through welfare reform), OR, prices must continue to rise in-world to a point at which they negate the exchange rate decline and cause greater demand for L$, resulting in equilibrium at a lower price point than we previously assumed the L$ was worth.

I'm really just interested in seeing things get into some sort of balance, as the VOLITILITY is the biggest enemy of profits. I don't care one way or another how the balance is acheived. I'm very open minded in this regard.

Well put. It's hard to convince people that the sinks are adequate when so much economic data remains under lock and key, but if they'd open up a bit and show us the numbers, this would work too!

The fact that they won't show you their data doesn't indicate that it doesn't exist. Sure, it would be nice if they would open up a bit more, but what makes you feel that you're entitled to their data? I have confidence that they will do the right thing, whatever that ends up being, after a careful examination of all relevant economic data.

I don't think I have a right to the data - although actually in this country IRL you do get to see the summary data that the chancellor uses to make the decisions, even if you disagree with the decisions he makes (and all of the chancellor's I can remember have been male). LL is also intermittently pretty open releasing data - I remember transaction summary spreadsheets, the data about LindeX is pretty easily accessible etc. They have a culture of sharing except in places that affect their business directly as a business, and our personal details - both of which are fair enough. The reason I asked to see the data originally was three-fold. First up Vadusha said "I don't want to bore you with the data" - but some of us like seeing the data. Second she's said elsewhere she's not run the data, so can she show it to us? Third, I, along with many residents, have an expectation that LL will either share data in full or in part, or will say "No, because..." Asking for it is not unreasonable on that basis, although I'm still deafened by the silence of the reply.

The problem I had with your statement was that the interview said, and Vasudha's own posts tend to support the idea that she hasn't "run the numbers" which is in the first paragraph you quoted - whilst you said the economist has run the numbers. If there's a good reason why stipends need adjusting then they'll do it - but doing it because someone, however otherwise qualified, has a gut feeling isn't a very good approach.

There are other options that can affect our economy - the three legs we've got to analyse it on are exchange rate (which is open), money pumped in (stipends and dwell which are not that clearly described in terms of L$), and money sinks - which again are not clearly described in their overall impact. All of those are gamed to some extent, except maybe the sinks, but it appears that the LindeX is, despite the doom mongers starting to settle to a new rate. If LL leave the stipends and it does settle to, say 295 ± 5 longish term then everything else will adjust doubtless. If they remove the stipends you can pretty much guarantee the economy will shake, groan and adjust over time - destroying the stability that you say you want in another of your posts. Continuously tinkering isn't going to make any of the elements stable.

BINGO! They don't want to bore us with the data, but even in spite of our excitement rather than boredom, they won't share it. I suspect that what they have doesn't support an economic policy that is in-line with resident growth goals, and this is why they won't share it.



This is all very true, but they're going to do what they're going to do. It is critical that we as a community both support their initiatives, and do what we can to augment them. Screaming about welfare reform is the wrong approach, IF welfare reform is the future, and frankly it sounds like it is. Anyone who truly feels that residents are entitled to welfare should simply start buying L$ and doleing it out themselves after the reform. It IS our world, afterall.




This is a very valid point. I too have noticed the crash subside somewhat. It's my opinion that this is simply a speedbump on the way to a final stabalization at a lower rate, but the point is still valid that the rate is irrelivant as long as it's stable there. People can either agressively reprice goods and services, or fade away.



If there's one place where we can certainly agree, it's right here. All of their tinkering is what causes this volitility in the first place. I think that the BEST action is no action. They should simply keep selling L$ for L$361 per dollar and let the cards fall where they may. Eventually, the exchange rate will find a balance and vendors can stop agressive repricing of goods and services at that point.

With that said, however, I haven't seen any more of the data that Linden Lab won't share than you have. It could be that I'm totally off base here, and that welfare reform really is the way to go, in light of all the facts that they won't share. Whatever Linden Lab does, as long as it is in the direction of long-term stability rather than the usual tinkering for a short-term rate boost, I'm FOR it!

It is SO CRITICAL that we do all that we can to stand behind our government, and work with them to end the volitility that eats our profits! The time for whining (not that you are whining, but it seems to be the general purpose of this thread) is LONG GONE. we have an exchange rate of around 300 while goods and services are still priced based on 250. I think that now is the time to stop WHINING, define a clear direction leading to clear and acheivable goals, and start DOING!

Right now I think the exchange rate is being manipulated a little to keep it at such a high number, if it is, it can't last much longer. The huge amounts of L$ that were at $280, $270, and below have all been depleated. A few weeks ago you could look and see over $1,000,000 all the way down below $250...even as of last week there was still a lot of large sums, but I looked yesterday and noticed those amounts had suddenly decreased. I don't know if it's sellers becoming anxious and trying to jump to the front of the line, ir if it's being used up to artificially manipulate the market. But if thats the case, I can't see it lasting much more then a week or two as fast as the Linden is being bought up

I would have to agree that there must be some point where it does go back into the 280s. There's only 4 rates over 1,000,000 and all of them are 285 or above. The rate could so easily be in the 280s or 270s, but the sellers have chosen to sell at 290 to beat everyone else in line.

More than likely, people got sick of waiting weeks (months?) and moved those orders to a more realistic price to get filled.