Linden Dollar Management

We all know for every dollar out there (US) there is gold bullion, which is the core of the US dollar, it's equivalent bit of gold in fort knox.

That's only sensible. But there's no core value of a Linden. It's make believe money.

We can't build a fort knox and store gold in there to back up the Linden dollars because gold in SL is meaningless.

So I'm trying to think, what would make a properly managed linden dollar? I've come up with a neat idea, though it would probably prove impossible to implement in the current "Second Life".

What if LL created 512m of land for every new player, and then gave the player the exact monetary value of that land in lindens? Then every linden dollar would be worth it's equivalent bit of dirt. And the money would take value from sims.

Then the person could give their money to LL in exchange for the land, and sell the land to other players, or do whatever they want. Mind you, for the currency to be in full flow, that would require nobody to have land (In the same way nobody has the gold in Fort Knox, but they all have the dollars).

Also a flaw, gold doesn't change value that much, but land has been known to go up and down a fair bit, which would increase and/or lower the value of a linden dollar? (Economists, this is your cue )

I think there's a problem, in that there's nothing valuable in the SL metaverse to base a currency on except land, and people actually want the land itself, to build on and stuff.

I doubt a real currency in SL can ever work having worked all this out. The fact the Lindens have no gold to back the Linden would be why they made it's value $0 and hoped for the best.

I did see one post that troubled me, related to this topic:



I think this person makes an excellent point. New lindens are pouring off the presses because of gangs of alt accounts. It's a big problem I think.

LL could set the value of the L$ like the chinese government. the could keep USD in the bank to back it. that would be a very easy thing to do. for example, if a portion of the premium account price was for the L$

6$/m gives 2000 L$. let's say 3 USD of that was for the stipend. so a block was worth 1.50 USD. from there on, LL could pay players selling 1.50 USD/block minus service fee, and charge consumers 1.50 USD/block + service fee.

there would be no need for sinks.

btw:

gaming alt accounts
it was based on a higher L$ value, though

LL could set the value of the L$ like the chinese government. the could keep USD in the bank to back it. that would be a very easy thing to do. for example, if a portion of the premium account price was for the L$

6$/m gives 2000 L$. let's say 3 USD of that was for the stipend. so a block was worth 1.50 USD. from there on, LL could pay players selling 1.50 USD/block minus service fee, and charge consumers 1.50 USD/block + service fee.

there would be no need for sinks.

btw:

gaming alt accounts
it was based on a higher L$ value, though

That is a good idea... I never thought of using the US dollar as the gold bars, and by extension using the US's gold reserves Nice thinking

It'd mean no more giving free money to free accounts though... Not sure if LL would like to hold back from that, it sounds appealing, something for nothing, even if it is an illusion

LL could still have the usual sinks they use for uploads to limit asset server usage. they could also create sinks for creating permanent asset server items. these sinks can be used to to cover the L$ payouts to basic accounts.

i think basic accounts should only get L$ for so long. i think if half the price of a basic account goes to L$, that's around 3000 L$. they get 1000 L$ for signing up the other 2000 L$ could be spread out over 4-6 months, at which point the stipend is done. it's good to space it out and not give it all at once so there is an incentive to stay for those months and in the mean time forge friendships and such that would keep them playing and maybe upgrading after their basic stipend ran dry.

Yep that sounds like a good idea

I think something like that should be a strong consideration for LL. Second Life isn't like other virtual worlds, it's mutated to be more serious, more real. Making the linden dollar have a real basis could change SL forever, marking it as head and shoulders above all the massive online games, and instead, a metaverse. Something demanding more respect than a mere game.

But getting back to the financial side of things, I think that would bring some backbone to the L$

er... Gold Convertibility of the dollar was ended on August 15th 1971 by Richard Nixon...
http://en.wikipedia.org/wiki/Bretton_Woods_system

Oh, people keep doing that. I don't mean you can ask the US govt for gold in exchange for your dollars, I mean that the US govt holds gold reserves to give the currency value, which goes on to this day.

If there were no gold reserves, a dollar would not have any actual value whatsoever.

Disambiguation:

Because people keep getting confused about this, I looked up all the issues around this. Here it is:

Gold Exchange Standard

A monetary system adopted by some countries which did not have enough gold to go onto the gold standard so they deposited their gold with one of the leading gold standard countries and made their currency more or less freely convertible to the currency of that country.

What I'm talking about:
* Gold Reserves
Gold retained by a nation or its central banks contributing to the nation's creditworthiness in the issuance of bonds and currency, although there may be no commitment by it to exchange gold for its currency.

Gold Standard

A monetary system whereby every form of currency issued by a country is convertible on demand into its legal equivalent in gold or gold coin

Hanks, there is no gold in those reserves anymore. There hasn't been for years.

But I still think your idea is valid. Let's have LL back those L$ with real cash. I suggest they use part of the cash we pay them for that

Then I think you stole them, you're going to jail for a thousand years. Because in 2004 the USA had 8,163.4 tonnes of solid gold in Fort Knox and other facilities throughout the USA:

http://en.wikipedia.org/wiki/Gold_reserves

And in case you forgot to take the gold when you got into Fort Knox, here's some information on the facility that might be useful:

http://www.globalsecurity.org/military/facility/fort-knox-depository.htm

Sorry to sound petty, but I've given some pretty reputable sources for my information. When you came here to denounce the entire US national currency, gold reserves and national stability by claiming ALL the gold reserves for the biggest nation in the world were gone, where exactly did you get those facts from?

I'm also going to post this one more time...

Disambiguation:

Because people keep getting confused about this, I looked up all the issues around this. Here it is:

Gold Exchange Standard

A monetary system adopted by some countries which did not have enough gold to go onto the gold standard so they deposited their gold with one of the leading gold standard countries and made their currency more or less freely convertible to the currency of that country.

Gold Reserves
Gold retained by a nation or its central banks contributing to the nation's creditworthiness in the issuance of bonds and currency, although there may be no commitment by it to exchange gold for its currency.

Gold Standard

A monetary system whereby every form of currency issued by a country is convertible on demand into its legal equivalent in gold or gold coin

There is no backing to the USD. The only thing that gives it value is faith in the USD. There is no gold, no silver, nothing but the faith in the US government that USD has value. The L$ is really no different. If the supply of USD grew by too much, the value would drop. If too few are made, then the value goes up.

.

Anyone knows how much $ are 8000 tons of gold worth to this date ? I can't figure it out Also how much of the current US national debt does it cover ?

Please read these. Then post your proof the US gold reserves are depleted.

Jesrad I'm going to take the time now to say sorry to you. My posts were probably a bit more agressive than I would have ideally liked. I get agitated sometimes in arguments when I know I'm right. But just cause I know something doesn't mean anyone else knows that thing I know, and it doesn't give me the right to be agressive. At all. So for that I am sorry, and I do owe you an apology.

I still have to learn to keep a cool head in a debate.

Edited cause my use of words was inelegant.

LOL

Like has been pointed out, the point of your thread has no credibility when your first sentence is absolutely incorrect. The US dollar is no more backed by gold than it is backed by surplus government cheese or toilet seat covers and tampons in government warehouses.

Please read these then post proof the US gold reserves are depleted.

I finally got it: a kilogram of gold is worth 15000$, so those 8000 tons are worth 120 billion $, approximately 1.5% of the US national debt.

Yup, seems depleted to me. They'd need 530000 tons of gold.

I don't think that US debt is as simple as that. Furthermore, there is no truth in the statement that "there is no more gold in those reserves".

I found this report from the US goverment itself:

http://www.fms.treas.gov/gold/current.html

Direct from the united states treasury.

And as far as US currency goes, I reckon 120 billion dollars of gold will go a good way to putting some bang behind all those bucks in your wallets.

Edit: Damn, just realised that is dated just ONE MONTH ago. Guess we can almost smell the gold bars from that report.

Oh, well, I admit being wrong on "no gold anymore". It's actually "hardly any gold anymore". Fine, my bad.

Actually it might be a lot of gold. The USA doesn't owe a single dollar. Think about it, how can the USA borrow dollars? They are dollars!

They have to borrow Euros, Pounds etc. from all the other nations of the world. I don't think the USA needs to keep gold on hand to secure what they borrow, as it's someone else's currency, and likewise it's backed up by other vaults. I know for a fact that in the UK our bank of England in London carries a large supply of gold bars.

Edited for clarification: If the usa gives me a buck, I have a buck. If the usa takes it back off me, it's still the same buck, backed by the same gold. And it's still from the USA. For the usa to truly have debts, they do need to borrow Pounds (GBP) or Euros or something. Sure, US politicians convert what's owed into dollars, but really can you ever owe yourself your own currency?

At least we can burn that gold for heat when our Strategic Petroleum Reserve is exhausted. Remember from chemistry:Oops. nevermind.