Idea: Give interest on L$ in user accounts

And that, to answer your question, would be bad.

But inevitable.

(edit to add: The % of people able to pay the entirety of their tier would decrease, not the actual quantity of people)

You have to pay cold hard USD for the 500 stipend.

I think the stipend ($50 / week) where you DON'T have to pay *ANYTHING* is a much bigger problem.

What would you rather pay .. 72 USD for 25K worth of L$ or 0 USD for 2500?

Use your uber economic skills to figure that one out..

The actual value of the L$ is not important. Instability and unpredictability is bad. When you don't have confidence in the monetary system, you cannot make intelligent business decision and investments in the economy.

If someone could say, "The L$ is going to drop to USD3/block, and stay in that range +-2% for the next year", I'd be ecstatic.

Let me reiterate what I'm trying to say:
1) I'm not trying to encourage people to hold "larger floats"
2) I'm not trying to create a new way for people to make money.
3) I'm not trying to figure out a way to redistribute wealth so that the impoverished will benefit.

What I'm after is monetary stability. As it stands, the value of L$ is completely fictional. There is really nothing you can do with it. What I want to do is change the equation so that L$ has a minimal, but inherent investment opportunity to give it some strength.

Riiiight. And the fact that I just paid for dinner with money I made from L$ means that dinner was fictional as well?

Well, here is a virtual belch in the general direction of that statement.

If the money is entirely fictional, then tell me, who cares what its value is? Who cares if it goes up or down?

Hell, the best stories are the ones that you can't predict! I love my fiction to be wild and exciting not boring and stable!

The answer to all this is: it's not fictional.

Careful, Anna, this is a tricky concept even for people who deal with it all the time.

The point of fiat money is it has no inherent value; even US Dollars have value only because people believe they have value. (Or, more specifically, it represents a kind of IOU on the part of the US Government, and there is faith that this government will make good on it's debts.)

Forget this thing and you can be in for some very rough surprises.

If you are trying to say that the USD is as fictional as the L$ my tummy will agree with you

Don't be so simplistic.

The point is, neither currency is locked to a real value; your "tummy" might have needed fifty cents to fill it up once upon a time, five dollars now, five hundred dollars in the future.

The point that Francis was making that seems to have sailed over your head is there is nothing locking the value of L$ to any one absolute standard, and there's no need to.

Which means the actual value of the L$ is totally irrelevant, since it is fictional - a fiction enough people agree on to be useful. It's not like a potato, which is always a potato, or gold, which is always gold. What IS important is that it keep more or less stable, so that by holding on to your lindens you aren't shooting yourself in the foot as they devalue day by day.

You mean, "as fictional as any modern currency, since the days of gold-backing currencies are gone"?
Amen!

All value is fictional. Diamonds, for example, are valued only because of a false monopoly created by DeBeers.

But whatever - the fact is though, somone gave me 10K L$, I converted it into 30 USD and got a burger at mcdonalds.

If me eating is 'fictional' to you, well that's your call.

I was once told that, technically speaking, the US Dollar is still backed with gold.

It's just not linked to it as a specific value.

Yeah, I didn't get it either.

Anyway, you're totally right, but many keep thinking of a dollar as something concrete and unchanging, like owning a brick, even when they know it ain't so. Every time the topic comes up on the forums, you get that.


My own guess as to what would "fix" things isn't changed, either... what's ideal is to keep the per-capita amount of L$ about the same, month by month. The problem is, while the SL economic system is basically a "social credit" one, it's a bit halfassed - it would be much more stable if LL could bring themselves to directly control the stipend amounts (and scale things like upload fees accordingly), except for the gigantic hue and cry when you start to give only L$37 (or whatever) a week instead of L$50 to put a brake on things. Never mind that the idea would be to make that L$37 have the same buying power as the L$50 did, it's less numbers so it must be bad.

(I ain't making myself out to be some kind of econ whiz, but hell, I have a business minor and this is basic Macroeconomics 101 stuff, really.)