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End Stipends Now

Gigs Taggart
The Invisible Hand
Join date: 12 Feb 2006
Posts: 406
06-09-2006 15:33
From: Lina Pussycat
actually lay back and actually see what SL needs as opposed to what you want to do to line your own pockets


SL needs content. Us content creators aren't going to work for free. We may work cheaper than our usual rates (I know I make no where near my normal rate of $35/hour). But we won't work for free.

As a content creator, a currency that has lost so much of its value so fast is a scary thing. I believe it will end the slide somewhere around 489, assuming stipends are not cut, but that's a long way off yet.

Would you invest in a stock that has a chart showing a decline of 50% in the last year? And it wasn't because the company was doing bad, it was because the company made a stupid decision to issue new stock all the time, diluting the stock already out there (think dot-bombs that paid people in stock options).

I know I'd think twice before investing in such a stock.
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Ravenous Dingo
Registered User
Join date: 25 Feb 2005
Posts: 78
06-09-2006 15:38
i dont see it happening

so long as LL gives stipends as part of premium accounts, i dont see how they can end them without pissing off a lot of peeps.

i dont mind stipends myself. at least not the ones 4 premium players. i think removing the basic stipends was a good move. could be a better move if they would end stipends for all basic accounts.

and when are traffic bonuses going away? i keep seeing them in my account history. i thought that was a done deal. they need 2 go.
Jonas Pierterson
Dark Harlequin
Join date: 27 Dec 2005
Posts: 3,660
06-09-2006 15:48
From: Gigs Taggart
SL needs content. Us content creators aren't going to work for free. We may work cheaper than our usual rates (I know I make no where near my normal rate of $35/hour). But we won't work for free.

As a content creator, a currency that has lost so much of its value so fast is a scary thing. I believe it will end the slide somewhere around 489, assuming stipends are not cut, but that's a long way off yet.

Would you invest in a stock that has a chart showing a decline of 50% in the last year? And it wasn't because the company was doing bad, it was because the company made a stupid decision to issue new stock all the time, diluting the stock already out there (think dot-bombs that paid people in stock options).

I know I'd think twice before investing in such a stock.


People invest knowing about the lindex, and about the stipends. They know the risks when they invest.

People shouldn't complain when a risk they take backfires on them.
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Lina Pussycat
Texture WizKid
Join date: 19 Jun 2005
Posts: 731
06-09-2006 15:52
From: Gigs Taggart
SL needs content. Us content creators aren't going to work for free. We may work cheaper than our usual rates (I know I make no where near my normal rate of $35/hour). But we won't work for free.

As a content creator, a currency that has lost so much of its value so fast is a scary thing. I believe it will end the slide somewhere around 489, assuming stipends are not cut, but that's a long way off yet.

Would you invest in a stock that has a chart showing a decline of 50% in the last year? And it wasn't because the company was doing bad, it was because the company made a stupid decision to issue new stock all the time, diluting the stock already out there (think dot-bombs that paid people in stock options).

I know I'd think twice before investing in such a stock.


And i dont expect you to work for free but the currency shouldnt be used by these people that complain simply for profit like it is. I make content to and i dont sell my L i use it for Sinks, to make more products, and to buy things from other people. If stipends are cut you will find yourself making less as a content developer i garuntee you that. You make make a short burst in profit but over the long term you will lose more and more as people become more fickle with their money.

The difference here i enjoy making content and sell it for what i think its worth what i put it towards isnt to try and turn a real life profit but have fun in world. The minority of people use SL to make money off of and the ones that have alot of L now are the only people that will benefit from getting rid of the stipends. I feel very strongly that most of you need to get out and be social with some people in Sl and see how it will really impact them and yourself. I think you will find your attitude change if you talk to a few common people that arnt rich and cant afford to buy L constantly that now buy your products using stipends will in fact say they will no longer do so because of being forced to buy money.

You fail to grasp what the effects on the majority will be and focus on the minority of people in SL. I dont expect you to work for free but i do expect you not to try to ruin SL for everyone else.
Lina Pussycat
Texture WizKid
Join date: 19 Jun 2005
Posts: 731
06-09-2006 15:57
From: Ravenous Dingo
i dont see it happening

so long as LL gives stipends as part of premium accounts, i dont see how they can end them without pissing off a lot of peeps.

i dont mind stipends myself. at least not the ones 4 premium players. i think removing the basic stipends was a good move. could be a better move if they would end stipends for all basic accounts.

and when are traffic bonuses going away? i keep seeing them in my account history. i thought that was a done deal. they need 2 go.


Wasnt really a good or bad move is the thing. The stipends themselves were never the problem. So getting rid of them isnt neccassary to begin with. I think some people forget the LindEx is dictated completely by users and those users control the value of the L.
Rasah Tigereye
"Buckaneer American"
Join date: 30 Nov 2003
Posts: 783
06-09-2006 16:39
From: Jonas Pierterson
People invest knowing about the lindex, and about the stipends. They know the risks when they invest.

People shouldn't complain when a risk they take backfires on them.




So, you're saying that people who buy GM stock shouldn't complain when GM starts to have financial problems? Er... whether you think that or not, peple who own stock do complain. they buy stock wt the understanding that tey will have some srt of a say in what the company does People who have investede a lot of money in SL fee like they sould have a say in what LL does, too. I think we ALL should have a say in it. Not complaining, stting down, and just taing it is pretty stupid I think. Besides, we're not complaining, we're trying to come up wt productive working solutions :D
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Rasah Tigereye
"Buckaneer American"
Join date: 30 Nov 2003
Posts: 783
06-09-2006 16:41
Lina, simple question. Why is gold so expensive? And if we found some way to just make gold out of nothing, would gold still be expensve?
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Rob Forester
Registered User
Join date: 5 Jun 2006
Posts: 37
06-09-2006 17:48
From: mcgeeb Gupte
I put way more than that into the classifieds the past several months!!!! Ending stipends will kill the economy. Sure the value of the Linden will rise for a while, but the L will become too scarce especially with the number of increasing accounts. Keep the per capita per player what is should be at and if that becomes to low it will be bad. If the per capita per player does indeed go up, then REDUCE the stipend ONLY.

9 months ago there was rating bonuses, full dwell payments and all stipends and things were just fine.


I think you're right. If you have money leaving the system, you can't just eliminate the money coming into the system. I'm just suprised that they don't give a larger amount than they do to first time players as a get them hooked ploy. I guess to keep things balanced that might make them lower the stipend, but there will always have to be a way the economy gets new money if old money is taken away. It is just common sense.
Rob Forester
Registered User
Join date: 5 Jun 2006
Posts: 37
06-09-2006 18:23
From: Lina Pussycat

I garuntee you if the most costly sales came up first the linden would travel in the opposite direction because these people would have to sell higher in order to sell faster. Come to think of it an idea just popped into my head from that and it could work as nutty as it sounds would require a bit of managment of LindeX on a weekly or monthly basis however. Make the economy a kind of sliding scale for a short time do what i said if the value gets to high switch it back to how it is. Solves The entire problem without so much as impacting a single player and should make these people outcrying for getting rid of the stipends happy that the value can go up instead of down depending how fast it travels up or down.

SUPPORT KEEPING THE STIPENDS!!!!

I don't completely know everything about the Linden economy, but if I'm understanding your idea as being changing what value the Lindex sells money at, then it really does sound crazy. The world will never be in a state where any country's currency can be dictated, and I would think it would be doubly true for Second Life. We have the internet now adays which leaves a million different ways for the economy to set a currency's value at its true value, and not at what some arbritary value people want to name it at. Not to mention, as far as I can tell, residents are setting the prices on the Lindex. Are you suggesting just selling extra lindens that makes no one money at a dictated price. That seems like it defeats the purpose of having play money tied to real money in the first place. There is a reason why all countries with centuries of experience have failed to truly set the value of their money where they want it to be.

I am rather confused at why people seem so scared about the currency changing values. All curencies change value. You can look at the FOREX market and see currencies all over the world changing faster than any stock in the stock market all the time. Currencies tend to be the fastest changing thing in an economy. Normally the changes are small, but the changes happen up and down very quickly making currency less stable than what it seems when you go to your local Wal-Mart. I think an economy can exist without being stable. I don't think putting some artificial stability by telling people a value will do anything except cause more ebay sales.

In the end though, it does seem like there must be some form of stipend. I see the point in needing some form of balance to the economy instead of a constant upward trend.
Francis Chung
This sentence no verb.
Join date: 22 Sep 2003
Posts: 918
06-10-2006 11:55
From: Aodhan McDunnough
The L$ had been dropping, as it should have, because people are trying to trade it on the Lindex at higher than its real value. Anyone who's observed trading markets (stock and forex) knows that trading something at other than its market value is generally unstable. As the market size grows (increase in trade volume) then this artificially high price becomes much more difficult to sustain.


For better or for worse, the trading price of L$ is what it is now. It is not "artificial" in any sense - it's a free-market. It is the responsibility of the central bankers to set policy according to the behaviour of the market.

It is irresponsible monetary policy to engineer an economy that suffers from constant and continual inflation.

I think that's the point that Rathe (and others) are trying to express - it is more important to the success of SL to seek long-term stability rather than to trade it for short term gratification.
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Francis Chung
This sentence no verb.
Join date: 22 Sep 2003
Posts: 918
06-10-2006 12:09
From: Aodhan McDunnough

Charity does not make money valueless.

[snip]

But in any monetary system a currency MUST SEEK its REAL value, whether that be high or low. Once it has done so only then can prices be set properly.



Correct. Printing money does.

There is, and there always has been charity in SL - resident driven even :)

Like dwell, I think stipends are good "starter fuel" for the economy - a good way to get it going. But as we move forward, it becomes a crutch - the economy should seek to be able to support itself, not be propped up by printing money (stipends).
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Lewis Nerd
Nerd by name and nature!
Join date: 9 Oct 2005
Posts: 3,431
06-10-2006 12:12
From: Francis Chung
I think that's the point that Rathe (and others) are trying to express - it is more important to the success of SL to seek long-term stability rather than to trade it for short term gratification.


It is those selling in a hurry, undercutting each other for the sake of a quick sale in order to reach targets that are the cause of the problem. There needs to be no Linden interaction, just a measure of self-control on the part of the big sellers.

If all the big sellers got together and made a pact that they'd put everything for sale at 300, the market would soon dry up and the new average would be set. But they won't, because self profit is far more important than the good of the community.

All mouth and no trousers, thats the problem. People want a 'solution' but are looking to LL to do it for them rather than personal sacrifice to achieve their goals.

Lewis
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Lewis Nerd
Nerd by name and nature!
Join date: 9 Oct 2005
Posts: 3,431
06-10-2006 12:16
From: Francis Chung
Like dwell, I think stipends are good "starter fuel" for the economy - a good way to get it going. But as we move forward, it becomes a crutch - the economy should seek to be able to support itself, not be propped up by printing money (stipends).


But the economy does support itself. Premium accounts pay to get L$500 a week, which we spend on uploads, entertainment or buying other people's products.

What you call a 'crutch' is the fine balance that keeps many people here, and without spenders, the content creators won't get customers.

If there was a way to earn money by working - like many successful online games - then that's one thing; simply removing all income and forcing people to buy money is not the solution.

Lewis
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Francis Chung
This sentence no verb.
Join date: 22 Sep 2003
Posts: 918
06-10-2006 12:25
From: Lina Pussycat
I think you people ranting to end stipends are prolly the lowest people in SL you obviously dont enjoy playing it and dont care if others do or not. Your out for your own little greedy agenda's and you yourselves are the ones hurting the economy with spewing crap like this. I dont think you quite get that YOU people are the ones controlling the linden value. Its not this supply problem you would have everyone believe and you know it as damn well as I do.


This isn't even true, nor does it make sense.

Rathe feels very passionately about SL, and like many of us, he wants to see it succeed. I believe Rathe's intentions are purely altruistic. Unlike many people, he believes that the good of the many outweigh the good of the few.

Let me prove it to you. Like Rathe says, he has a lifetime account - as long as stipends are in place, he essentially gets free L$500 a week. If he was a greedy person, he would insist that stipends remain in place.

But Rathe believes something else is more important than make a bit of easy money - he'd like to see SL be successful, and a key component of that is to create a stable econonomy.

The point is this:
It is irresponsible monetary policy to print money, and then sell it for below market rates. We're all witnessing this the ramifications of this policy in terms of continual inflation. Just like any other economy, the key to long-term success should be to grow the economy without inflation.
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Francis Chung
This sentence no verb.
Join date: 22 Sep 2003
Posts: 918
06-10-2006 12:32
From: Lewis Nerd
It is those selling in a hurry, undercutting each other for the sake of a quick sale in order to reach targets that are the cause of the problem. There needs to be no Linden interaction, just a measure of self-control on the part of the big sellers.


Undercutting is a natural market force. To claim that is the problem is ridiculous.

It would be like the federal reserve claiming their monetary policy is sound, and blaming the state of the economy on the fact that Americans behave like people.


Edit to add:
From: someone

If all the big sellers got together and made a pact that they'd put everything for sale at 300, the market would soon dry up and the new average would be set. But they won't, because self profit is far more important than the good of the community.


This is called price fixing. It's a felony in the USA, because it's a destabilizing force.

From: someone

All mouth and no trousers, thats the problem. People want a 'solution' but are looking to LL to do it for them rather than personal sacrifice to achieve their goals.


How can you say that when Rathe just did what he did? He put his money where his mouth is and has just demonstrated his willingness to make a personal sacrifice to the tune of L$26k.
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Joannah Cramer
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Join date: 12 Apr 2006
Posts: 1,539
06-10-2006 13:06
From: Francis Chung
Like dwell, I think stipends are good "starter fuel" for the economy - a good way to get it going. But as we move forward, it becomes a crutch - the economy should seek to be able to support itself, not be propped up by printing money (stipends).

Unfortunately, any illusion of "economy" SL pretends to have is destroyed quite promptly by the same people who call to have it stabilized -- when the only answer they can give to question "how a starting player is supposed to get money in SL?" is "buy if from LindeX".

Such answer basically reveals what SL is. A make-believe playground with extremely limited means to increase both wealth of its whole 'economy', and individual's income. And as such, it's a small wonder the virtual currency for this kind of toy fails to maintain stable exchange rate on free market with currency of developing, real world economy. If anything, it's silly to expect things be otherwise, because it's essentially market force at work: the USD keeps gaining over L$ because it's simply more desired commodity.

The economy by all means should seek ways to be able to support itself, but killing stipends is something absolutely different. It's just a way to introduce artificial scarcity of virtual currency, in some desperate last-ditch attempt to slow down this slide of exchange rate... which will continue to happen anyway as long as SL is simply not enough interesting place to make enough people want to buy its virtual money to purchase entertainment it provides.
Francis Chung
This sentence no verb.
Join date: 22 Sep 2003
Posts: 918
06-10-2006 13:27
From: Joannah Cramer
Unfortunately, any illusion of "economy" SL pretends to have is destroyed quite promptly by the same people who call to have it stabilized -- when the only answer they can give to question "how a starting player is supposed to get money in SL?" is "buy if from LindeX".


I'm not entirely sure this is a bad thing. I remember when I started I would've loved to have something like LindeX around. There was all this great stuff, and I wanted it! My tiny little bit of purchasing power was derived solely from stipends. So, I just had to go without :(

Besides, think casino chips - how do you get chips when you walk into a casino? You buy them from the house :)

From: someone

Such answer basically reveals what SL is. A make-believe playground with extremely limited means to increase both wealth of its whole 'economy', and individual's income. And as such, it's a small wonder the virtual currency for this kind of toy fails to maintain stable exchange rate on free market with currency of developing, real world economy. If anything, it's silly to expect things be otherwise, because it's essentially market force at work: the USD keeps gaining over L$ because it's simply more desired commodity.


The USD keeps gaining over L$ because the L$ is unstable. (Yes, it's a vicious cycle)

Strangely enough, if you look back, the L$ wasn't always as volatile. We used to have a leaderboard where you could see the account balances of the top 10 people in SL. They didn't mind holding millions in their account for no particular reason.

But there's no reason that this is all make-believe. There are people (I'm one of them) that would like to see this whole thing be all for *real*.

From: someone

The economy by all means should seek ways to be able to support itself, but killing stipends is something absolutely different. It's just a way to introduce artificial scarcity of virtual currency, in some desperate last-ditch attempt to slow down this slide of exchange rate... which will continue to happen anyway as long as SL is simply not enough interesting place to make enough people want to buy its virtual money to purchase entertainment it provides.


There's nothing "artifical" about the supply of L$, anymore than there is an artificial supply of US$.

Phasing out stipends is one solution. It's not the only one - if LL used the money they received from premium accounts to purchase L$ they give out, that would work too.
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Lina Pussycat
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Join date: 19 Jun 2005
Posts: 731
06-10-2006 14:31
Actually it makes perfect sense and anyone claiming anti-stipends is not thinking of the good of the many as opposed to the good of the few. Thats quite a simple fact. If they were worried about the good of the many they would be doing the opposite and polling for a better system as opposed to getting rid of the way many people in fact make a profit in SL. Im aware you have been around for awhile but even you gotta admit things like the stipend are not the cause of the problem.

Over the past year the value of L has been on a decline due to people undercutting one another while this may be standard to them its these type of actions that hurt the community and the economy as a whole. They dont want to take the blame for their actions so they push it off on the stipends as being the cause of it which simply isnt true. While what i said may not make sense to someone that believes the anti-stipend propaganda it makes perfect sense to someone who actually is here for leisure as opposed to working.

I think its wrong to force people to buy all their money this isnt done in any game at all. Even something like gunbound or alot of the korean/malaysian/asian based online games that use a Cash/Game money system have in game money one can earn to get themselves going. As i said again why dont you just lock me in a sweat shop and pay me 3 cents and hour but make me pay you 5 cents an hours. Its tant amount to the same thing really.

I for one see these rants for getting rid of the stipends as coming from the people that arnt really worried about SL's future. They really arnt worried is what i think you fail to see Francis :(. And that really worries me. People that dont realize just how important the stipend really is are people that could care less. If your so against the stipend give me it weekly. I bet you wont i bet you will hold onto that and buy something you want. And other people may spend them on products you sell.

No matter how much someone tries to claim otherwise they are dependant on the stipend be it their own or someone elses to get by in SL. No matter how much you dont want it to be true if you spend money in SL or if you sell something you depend on that money that people get. No matter what. Kinda hypocritical them of these people to go scream the stipends are ruining the economy.

I believe what i said to be subject to actually looking at the people Francis and they have proved themselves to fit what i said many times. Lewis is quite right if the people selling the L got together and said they'd only sell for 300L > 1 usd then thats what the value of the L would be. The problem is how open LindEx really is. Its to open to be abused by those that are just here for profit and sadly they control the value of the L :(
Rob Forester
Registered User
Join date: 5 Jun 2006
Posts: 37
06-10-2006 14:36
From: Lewis Nerd
It is those selling in a hurry, undercutting each other for the sake of a quick sale in order to reach targets that are the cause of the problem. There needs to be no Linden interaction, just a measure of self-control on the part of the big sellers.

If all the big sellers got together and made a pact that they'd put everything for sale at 300, the market would soon dry up and the new average would be set. But they won't, because self profit is far more important than the good of the community.

All mouth and no trousers, thats the problem. People want a 'solution' but are looking to LL to do it for them rather than personal sacrifice to achieve their goals.

Lewis


If anyone can sell at any price they want, how in the world do you think big sellers can dry up the market. Besides, if the sellers did do this, then they would be distorting the value of the currency to a value it is not naturally worth. In the long run these sellers would lose a great deal of money if the natural trend actually is for the currency to become less valuable. They would sell less and less, until the market would inevitably burst causing these sellers to have hoarded Linden dollars that could of been sold for more than they are worth at present in the past. In fact this quick jump in price everyone is talking about would make perfect sense if people were mistakenly trying to sell their money at too high of a price when in fact the money was worth far less.

The only time people have ever succeeded to force a value to something its not supposed to be at is the people that have monopolies. A currency that is being distributed to everyone in the form of a stipend weekly is impossable to have a monopoly on. It is foolish to think that economics is purely a matter of self control without taking into account that it is a large complex dynamic entity like water. Sure if you have enough of the currency to block almost all the flow you can control it, but is there people out there that truly have more than a twigs worth of the 15 million Linden dollars traded per day.

By the way is there a three letter combination people use for the Linden dollar, like the USD for U.S. dollars or the CHF for the Swiss franc? Would be so much easier just to refer to it as LIN or LND instead of linden dollars. I think I've seen some people use $L. I know its not an acutual country's currency, but I was just wondering if anyone used something for simplicity's sake.
Lina Pussycat
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Join date: 19 Jun 2005
Posts: 731
06-10-2006 16:22
Rob the thing is they can sell the L for whatever they want. Thats how LindEx operates. They set the value they sell it for they sell it at a lower value they sell it faster. See how that works out to being how things are now? They keep undercutting one another. Getting rid of the stipends wont fix the problem.

It may create a momentary boom effect but really other then that it wont do a damned thing other then destroy people being able to use SL for something other then some twisted little business platform. SL is not just a business platform lets not forget that. There are people who come here for leisure that still pay 10 usd a month. The stipends are paid for unless you have one of those Lifetime accounts. 50L a week per basic account that logged in that week wasnt killing anyone and its not going to help by getting rid of premium stipends.

What people fail to grasp is as long as LindEx is as free as it is this trend will continue with or without the stipend its just how things work out. And It will fail due to the nature of the people selling the L. The stipend was never a problem to start with it was just a rant made by a few people that caused a problem they cant fix and are looking for some quick way to make a profit selling the L they have in pocket now.

When someone can go on LindEx with the start of the day being say 325L > 1 USD and sell a block of 16,000,000L at 330L > 1 usd then there is a problem with the person selling it. But if this same person Pulled and stayed at 325L > 1 USD the person behind him would undercut him to sell faster then him. You see the flaw in this system yet? Its got nothing to do with the stipend at all.

Look at all the L sources that have been gotten rid of in the past year alone and try and tell me again that the volume of L coming into SL is the problem. They lessened and lessened the free L people got and it has yet to improve the value of the L. And that says alot really. Its shows what the true problem is.

The problem is LindEx itself it is flawed horribly and favors working the system to make a quick buck,
Rob Forester
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Join date: 5 Jun 2006
Posts: 37
06-10-2006 17:01
Lina, I agree with you that cancelling the stipend would make no sense. It is obvious that it serves an important purpose. That is not the point I'm trying to make. I'm trying to say that you can't fix a price. There is no problems with a changing price. It is how things work without anyone doing a thing. Nothing is ever the same value always. I also don't think inflation is always a problem. The main problem with inflation in the real world is that banks and investors that loan money might not make money off of their loans. If you want the people to want to spend their money instead of hoarding it, then inflation is a perfect punishment to those that want to hold on to their money instead of spend it. I guess it is up to Linden Labs whether they want to be in a phase of having the economy churn quickly with lots of exchanges which could be a good thing in this young unique place, or if they want rich people to invest in the world as a business opportunity which could be a good thing for them as a business. The stipend is not a problem, but it is definately a peice of a puzzle. Part of how an economic system works is effected by the supply which the stipend does effect.

Also, I have already come to understand that people can undersell each other, but this how all economic systems work. If the right forces effect the market, then the market can have every one overselling each other. The price can go up just as fast as it can go down. There does appear to be a buyers market on the Lindex for as far as I can get the chart to go, which means that the correct thing most of the time has been for people to undersell everyone else. This is normal, and it happens to every currency including the U.S. dollar. I don't know if you have looked at currencies exchanges, but this happens all the time. For instance, the Japanese Yen has declined in value for a while now, and rightfully so with many factors effecting them in the world economy. By allowing trade between the $L to the U.S dollar, Linden Labs have added themselves to the world economy whether they like or not. This currency will now go down when the government and the people in the economy peice by peice cause it to. It will go up when the same people cause it to.

Personally, I doubt large businesses are going to invest in Second Life businesses. There does not seem to be much legal protection for alot of problems that can be solved in the real world. I doubt the stipend is the thing stopping multi million dollar investment. It probably has more to do with the high risk of such an extremely new type of business investment.
Joannah Cramer
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Join date: 12 Apr 2006
Posts: 1,539
06-10-2006 19:14
From: Francis Chung
I'm not entirely sure this is a bad thing. I remember when I started I would've loved to have something like LindeX around. There was all this great stuff, and I wanted it! My tiny little bit of purchasing power was derived solely from stipends. So, I just had to go without :(

Besides, think casino chips - how do you get chips when you walk into a casino? You buy them from the house :)

Am not saying this is bad thing, what am saying is, this is a good sign SL doesn't actually have "economy" to speak of and try to regulate. That you bring up casino for analogy only confirms it -- a casino is simple playground that is expected to bring owners the income, and doesn't pretend to be anything else. No one sane expects to make a living trading casino chips, or get paid in these chips for their casino-related work.. and they aren't exactly a commodity put on public market with price determined by supply and demand either, right? ^^

From: someone
The USD keeps gaining over L$ because the L$ is unstable. (Yes, it's a vicious cycle)

USD also is not stable by any means, and neither is any currency after all. And besides, any unstability you might speak of _is_ caused by desire to trade L$ for USD outweighting desire of others to exchange their USD for L$ ... this is end effect, not the cause. People want USD more -> L$ value falls -> L$ is perceived as unstable beacuse well, it is. Since it's not interesting enough commodity to generate enough interest.

From: someone
Strangely enough, if you look back, the L$ wasn't always as volatile. We used to have a leaderboard where you could see the account balances of the top 10 people in SL. They didn't mind holding millions in their account for no particular reason.

There is always someone who doesn't feel the need to cash out. It doesn't affect in the slightest all these other people who in the meantime _do_ cash out, though ^^ and as long as these other people don't hoard their game money, they can buy and sell many times more the money collectors keep on their accounts.

From: someone
But there's no reason that this is all make-believe. There are people (I'm one of them) that would like to see this whole thing be all for *real*.

Which part, flying, teleporting, being able to change shape at the whim, or the economy? There's already extremely realistic economy in RL, so if one wants to be "a real market tycoon" they can do it there... And you simply cannot make it all like "in real" in SL because half of the stuff that makes RL economy what it is cannot be even included. And if anything the whole "omg balance sinks and flows" thing is demand straight from the dumb MMOs with their money mints in every single wandering mob that respawns as soon as you whack one over the head.

From: someone
There's nothing "artifical" about the supply of L$, anymore than there is an artificial supply of US$.

Artificial part is trying to burn part of money in circulation in attempt to make the rest gain extra value...

From: someone
Phasing out stipends is one solution. It's not the only one - if LL used the money they received from premium accounts to purchase L$ they give out, that would work too.

How exactly "that would work"? It still means there's a continuous money drain because it's just reusing the money which was printed at some point in the past, and new currency is not coming in while some gets continually destroyed on fees and such. If LL is then supposed to print extra money after shortage gets too severe, in some misplaced attempt to keep the exchange rate more or less when some people _think_ it should be.... then you know, here's third option that's _way_ easier and produces even better results: LindeX is shut down, and LL takes over complete trade of their game currency at fixed rate. Just like the casino you mentioned that sells the chips to their visitors and rakes in 100% of the money they spent on getting them, instead of some measly 3.5%

LL gets the money, you get the fixed exchange rate on L$ that's supposedly sooo desirable. Best of both words, ain't it? Though i guess not for RBD and such...
Hunter Parks
Mr. Morgan
Join date: 16 Sep 2004
Posts: 53
06-10-2006 20:33
From: Lina Pussycat
The problem is LindEx itself it is flawed horribly and favors working the system to make a quick buck,


Hi Lina,
In as much as I am personally 'on the fence' regarding this issue and can certainly see good arguments on both sides, I have to disagree with your statement regarding the Lindex being flawed.

The Lindex, like every other successful exchange market, is based on bids and offers. Depending a wide array of external influences, such as supply/demand, inflation/deflation and general economic conditions, it will seek it's own level. This type of system will never fail. The Lindex, like the major stock exchanges, is a very good thermometer of it's underlying economic drivers. It does not favor one side or the other, but what it does do is provide you with an indication of what people are determining as 'value'. The traders (or market) set the prices.
Remember, there are 2 sides to what you see, not just 1. For instance, you see someone selling a block of 2 Million L$ for $325/1US, what we sometimes don't see or recognize is that there is someone else offering to buy 2 Million L$ for $335/1US.
Eventually there will be a trade somewhere in the middle, and whether that price is $330 L$/1US or even $200 L$/1US it's not the exchange that influences the price one way or the other. It's perceived value.
That said, one of the main reasons the economy in SL is struggling is because of the constant influx of newly printed L$ (Stipends). Bear in mind that I am not in favor of eliminating stipends. I feel many people rely on them and they deserve at least that, if not more. But to illustrate the dilemma on the other side, when LL constantly throws more L$ into the economy, each L$ already there becomes worth less and less, until at some point they will be of little value at all or worthless because there are just too many of them.
There has to a balance between sources/sinks for this SL economy to become stable. I don't agree that stopping stipends, although it would be a step towards a better balance, is the answer. The answer is obviously simple....balance the sources/sinks, but how we get there is anybody's guess.
This is obviously a very emotional argument. I don't think there are any bad guys or as many greed mongers as you suggest. I think we all care about what happens here and we certainly all play for many different reasons. It's not fair to criticize others because they play for a different reason than myself, nor is it fair to accept criticism from someone who's not coming from the same place I am. At the very least, we should all respect the fact that, in as much as we disagree about the solutions, we all want the same thing....a continued SL where we can enjoy whatever we do here.

Peace,

-Hunter
_____________________
"It's not who dies with the most toys, it's who dies with the most friends!"
MissWendy Divine
Registered User
Join date: 28 Dec 2004
Posts: 14
06-11-2006 02:48
I am not a guru of economics. I took it in college, and left most of it there.

I am, however, a detective. What I have seen over the last 18 months is several of "printed money" opportunities ended or changed and as there is less and less printed money in the game the value of the linden has gone down.

We used to pay L$1 to rate some one, now it is L$25
We used to get L$500 reembursements for any event giving out L$500 in prizes, now we do not.
We used to get generous bonuses for positive ratings now we do not.

I personally was making easily L$3K weekly

At the same time, the value of L$100K has dropped from $475USD to about $330USD.

I understand the concept that more players means more money is in the game, but when you do the 'printed money' math that means, essentially, I am financing 5 new premium accounts myself.. and so is everyone else that has been here for over a year. Are there 5 times as many players? maybe.

I do not see any evidence whatsoever that it is the amount of 'printed money' causing the devaluation of the L$. We have less "printed money' than ever. Prices are higher than ever as a result of less stipend. I am not sure how LindenEX effects the value. I see what happens with updates and patches, I am not going to use LEX anytime soon. It doesnt really matter where you buy lindens. We all buy $L at the best price, where ever that seller is.

As long as someone is willing to sell their Lindens for $3USD/1000L then that will be the market price. The price will go up when we sellers decide not to sell at $3USD. It doesnt matter if we get L$500 a week or $L5000 a week handed to us, if we decide not to sell for less thatn $4USD/1000 then that will be the price.

Sadly, people will settle for less. You cannot contol someone's decision to sell themselves short. Then the seller says to himself, "Joe is selling his L$ at $3/1000 if I don't sell mine at that then mine won't sell" which is a myth. but ppl buy into that kind of thinking all the time. So, now Every Joe is selling at $3/1000 and everyone is saying "STOP!".
Buyers are looking for a deal. Why pay retail if you can get it brand new at a garage sale price?

The evidence suggests it is the sellers controlling the value. Not anything else. Unfortunately, trying to get all the sellers to stop and sell at no less than $4/1000 is not possible.
_____________________
People used to tease me and say I looked at the world through Rose-Colored Glasses. I corrected them and said it was a Rose-Colored Rifle Scope. Now, they don't tease me anymore.
Lina Pussycat
Texture WizKid
Join date: 19 Jun 2005
Posts: 731
06-11-2006 03:24
From: Hunter Parks
Hi Lina,
In as much as I am personally 'on the fence' regarding this issue and can certainly see good arguments on both sides, I have to disagree with your statement regarding the Lindex being flawed.

The Lindex, like every other successful exchange market, is based on bids and offers. Depending a wide array of external influences, such as supply/demand, inflation/deflation and general economic conditions, it will seek it's own level. This type of system will never fail. The Lindex, like the major stock exchanges, is a very good thermometer of it's underlying economic drivers. It does not favor one side or the other, but what it does do is provide you with an indication of what people are determining as 'value'. The traders (or market) set the prices.
Remember, there are 2 sides to what you see, not just 1. For instance, you see someone selling a block of 2 Million L$ for $325/1US, what we sometimes don't see or recognize is that there is someone else offering to buy 2 Million L$ for $335/1US.
Eventually there will be a trade somewhere in the middle, and whether that price is $330 L$/1US or even $200 L$/1US it's not the exchange that influences the price one way or the other. It's perceived value.
That said, one of the main reasons the economy in SL is struggling is because of the constant influx of newly printed L$ (Stipends). Bear in mind that I am not in favor of eliminating stipends. I feel many people rely on them and they deserve at least that, if not more. But to illustrate the dilemma on the other side, when LL constantly throws more L$ into the economy, each L$ already there becomes worth less and less, until at some point they will be of little value at all or worthless because there are just too many of them.
There has to a balance between sources/sinks for this SL economy to become stable. I don't agree that stopping stipends, although it would be a step towards a better balance, is the answer. The answer is obviously simple....balance the sources/sinks, but how we get there is anybody's guess.
This is obviously a very emotional argument. I don't think there are any bad guys or as many greed mongers as you suggest. I think we all care about what happens here and we certainly all play for many different reasons. It's not fair to criticize others because they play for a different reason than myself, nor is it fair to accept criticism from someone who's not coming from the same place I am. At the very least, we should all respect the fact that, in as much as we disagree about the solutions, we all want the same thing....a continued SL where we can enjoy whatever we do here.

Peace,

-Hunter


Actually no hunter its not based of bids and offers at all for you to buy straight up you buy L at a set value otherwise you wait for your order to be filled. The part that is fundamentally flawed is being able to buy straight up which is what people use more often. And no most of us dont want the same thing. Alot of the people screaming stop the stipend are out to make money. There are bad guys and alot of greed mongers i just think you've yet to run into as many as some other people have to make an argument against them.

I dont critcize them for playing for a different reason but i feel that while thats fine and dandy they shouldnt try to ruin SL for the people that want to play it at a leisurely base. LindEx is flawed if you ever have bought L you know its not an auction system but rather a buy straight up thing. If it was bidding on the money the value would be much weirder then it is now and would fluxuate even more.

MissWendy's arguments are quite true. And point out what i mean LindEx b4 the recent LindEx change was just buying L straight up. When people keep selling for less and less the value drops. They could give us a million L a week and it'd be up to the sellers of the L to set the value no one else. They play to heavily into the theory that if the value is higher that no one is going to buy the L and that is where things get out of hand. They then come on here and scream that the sky is falling when they were the cause of it themselves.

Sadly her last bit there is very true :(. Its impossible to get the sellers all to sell at a certain rate to bring up the value of L. Over the past year money has dwindled down greatly coming into SL. Oh yeah i'd like to point out when there was alot more money coming in per resident (most residents are basic anyways and 50L a week on them really dont hurt no one) the value of the L was higher then it is now with less coming in per resident.

Now back then GOM was still around and that was before the little panic episode LindEx caused for alot of people. Im not a detective nor am i an economics expert, however I do know how human beings act and thats impossible to change without forcing it on them. Getting rid of the stipends will only help in a short term profit making scheme. All these things about the economy should be able to support itself is kind of out there considering it already does.

The people selling L made mistakes brought down the value of the L cant reconcile it themselves and are now pushing the blame onto the stipends hoping that will fix it. It'll come down to them saying at some point if they do get rid of the stipends "WTF were we thinking". Look at it this way right now Lets Take Joe now Joe has a premium account and plays for leisure. Joe doesnt make anything in SL and doesnt know how to and really has trouble learning. Joe wants his 512 sq meters of land as well and has to pay the 10 dollars a month to get that with the stipend. Joe puts his 500L a week after buying land to buying your products be it clothing or hair or whatever.

You rely on Joe coming to your shop and spending that L weekly and then save up and Sell that L on LindEx. You see the rate is currently 331> 1 usd or whatever but decide you dont wanna wait and sell at a rate of 336 > 1 usd. Now you have put L in at a lower value and people have to wait for your money to sell or they can go back out and sell it for even cheaper. Basically you have plugged up the market to sell faster. Now you did so and then come in here and scream the L is falling after you sold it for 5 points under current value.

Anyone see the flaws with LindEx yet? The flaw being its to free of an exchange they are free to set the price at whatever they want. They could sell it for 4000 > 1 USD if they wanted to and if a few people followed in suit that would be the value of the L. They are not penalized for this though. Human nature cant be changed without that person wanting to change themselves and sadly these people dont they want to just push blame elsewhere and dont care about the effect it'll have on everyone else.
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