Linden Lab thinking about printing money and selling it...

Want to know why dwell is being eliminated?

Want to know why developer incentive is being eliminated?

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"We are considering the sale of L$, but only within the context of smart economic policy."

What is "smart economic policy"?

Well, to a company that has investors it needs to satisfy, smart economic policy is making more money and turning a profit.

Folks, this announcemnet that Liden Labs is going to begin to essentially print and sell L$ on demand is a blow to SL, no matter how you view it.

They are taking away incentives because they want ALL money coming into the economy to be purchased directly from them. They don't care where it goes after that (ironically, sold BACK to Linden Labs with a fee most likely), as long as it comes from them and is bought from them.

Bull. Crap.

Oh, and if you think that what Robin said is that they "are just thinking" about doing it... think back. "Hey, we're thinking about enabling point to point teleportation, what do you think?" Two days later, point to point teleportation. "Hey, we're thinking about starting this thing called the ResMod program. What do you think?" THAT DAY, the ResMod program was rolled out.

This change is coming, folks, and coming soon.

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Of course they can sell L$ IF
-> They have a Federal Reserve Bank System
-> They also buy from market
-> They stops printing money, and they can ONLY sell what they bought from the market.

else this is the BIGEST damage to LL's reputation.

WHAT ARE YOU SELLING? HOW DID YOU EARN THE L$ TO SELL?

Edit: Lindex was going to be good, but with Robin's this lovely post ALL WILL SELL before LL starts to SELL just watch the coming devaluation.

My only concern here is that it's yet more emphasis on the economic side of the game, and I have yet to see any serious information regarding improving the overall quality of the experience - such as efforts to reduce lag, building zoning and regulations, more roads and infrastructure etc.

The only thing wrong with the economy is that so much is based around land sales, and land is too expensive.

You get it wrong again. It's not devaluation.

L$400 to $1 gives better value for money than L$300 to $1 - so it's great for the buyers.

As for the sellers... consider yourself lucky you can even cash out game money in an allowed way. That, in my opinion, is the biggest damaging part of the whole SL experience, when people ignore the fun and entertainment that can be hand and concentrate on how much cash they can make. Nobody makes anyone play SL, and to rely on it as an income (which would disappear the moment LL pull the plug anyway) is false security.

I just hope this isn't a backdoor way of killing stipends - because if they do that, and don't adjust the monthly account fee to compensate - then there will be all hell to pay.

Lewis

Well, I think the key is exchange stability. Being able to buy and sell their L$ will give them more tools to encourage this.

However, I think they might have said something about "buying L$" in their announcement if this was their policy. If it is their policy, it's a little unfortunate they did not mention that.

A rate of 400 to 1 would kill the economy. Do you think that it would be great for buyer's? Inflation would just go up with it, so no it would not be great for buyer's just as inflation in the real world is bad for buyer's.
I do not know why it is so bad for people to be able to make money in this game. It creates an economy which is very productive. There are so many things available in this game that make SL great. If SL needed to hire people to make all of these islands, buildings, and content, the membership fee would be much more.
If many people didn't make money, there would be a lot less people dedicated in making things. If I made things for fun and with no option to cash out, I would spend far less time making things if I did. I spend a lot of time making things and others spend much more time than me. How would SL pay for their servers if the economy relied on just game money?
A rate of 400 to 1 is great for buyers at today's prices and only that.

They will just stop giving it away (ala stipends, inncentives, and traffic bonuses, such as those recently removed from the world) and start selling it instead. The amount of L$ coming into the game won't change (in volume) but they will be making a lot more $$$.

Don't you see, it worked so well for There

well, at least we now know what the very silent economy guru Vasudha Linden has been doing all this time. Plotting the end of the Second Life economy as we know it so they can make a few more bucks themselves by magicking L$ out of thin air.

OK, NOW you can all bitch about the economy and the value of the L$ and be justified in doing so. The sky really IS falling this time...

I would prefer LL to post this:
"We dont care the economy of residents, we care about the economy of LL. And to make profit we will start to sell L$"

It could be more honest. The funniest thing is the pdfs Robin sent on his post.Where did you find them?Google? How much time u spent to find them? 5 mins? All residents who have a little economical info knows that it can never work while only printing new money, without a reserve bank,without buying from the market if necessary.

Now there is no reserve bank, no info about LL will buy L$ from market, no info about planned policies.

Only that : "WE WILL SELL L$ TO FIX THE ECONOMY". Well, here is not teen grid robin, we are not kids.

Yet another time LL is going to compete with thier own users.

Only way it would not be is if they were to sell thier manufactured L$ when he market was devoid of L$ for sale - and how likely is that ever to be?

There is a big disconnect between being a rapid development platform for content development and this odd insistance on competing with them. If you want folks to take the big plunge and make soem really captivating content then I strongly suggest, deal Linden Lab, that you stop making it an eviron where we all wonder if our efforts will be undercut or even forcably absorbed by the very company that invited us here to work with promises of that content belonging to us. Promises of being able to turn an actual profit from our work.

I would very much like to hear an explanation of why this move is being made, as it defies any explanation from me.

There's a few things that strike me as odd about this announcement:

1. It's actually kind of hidden as a change in the TOS - that's what the post title says.
2. It's been made at about 10.45pm on a Sunday where LL is, a strange time to make such an announcement.
3. It's completely full of if's and maybes.
4. Why isn't it Philip or the economy guy Vasudha Linden making this announcement?

I dunno, this all seems rather misguided and almost like it's being sneaked in, aiming for as little drama as possible.

I'd love to know how this will work in relation to the LindeX - are they going to sell direct at a fixed rate or flood the LindeX at those times when they feel the economy can take it. Either way, I'm not sure how good this would be for those who sell their L$ currently.

This is definitely a change in Linden economic policy but not so much bad news as many comments in this thread seem to conclude.

1. Linden Lab has allways been printing money. Actually, it was the only entity, who did so.
   
2. Linden Lab has been selling money for quite a while. Opening a premium account and paying 9.95 per month (or less in equivalent per quarter or per year), gave you 2,000 L$ per month.
   They are (or might be) doing it just in a more transparent way now.
   

There are many questions concerning this announcement/warning, though. How will this selling be done? At what exchange rates? etc. Maybe we should wait until more of the details are anncounced before condemning this move.

What worries me a bit with the links to macroeconomic papers, Robin is supplying, is the fact that, while I personally agree with most of the assumptions and conclusions in these papers, the analogy to the economy of Second Life seems a bit farfetched in a few very important details.

The two most important details, in my opinion, are:

An independent Reserve Bank
Most modern economies have a more or less independent Federal Reserve Bank (or Bundesbank or ECB or ...) installed. This institution is mentioned in those papers, too, and it is very important if you want to apply the models presented. I don't see such an institution in Second Life. And I don't see an easy way to install it.

A banking system
Monetary policy does not consist of opening or throttling the money press alone. Many day-to-day adjustments use much finer tools. Most of them have to do with influencing interest rates in a multi-level banking system. But there are no loans, savings etc. in SL; not really. And - as many have said before me - banking is not easy to implement in SL.

There's the line in Robin's post that says :

"In other words, we will only sell L$ if we think the economy can absorb a new infusion of L$ because either other sources have been reduced or sinks have increased."

Could they be thinking about removing/reducing stipends? That could create a situation where LL may think the economy could absorb a new infusion of $L.

Yah, let's go with that theory anyway cuz it's the one that'll produce the most forum drahma/outrage/entertainment.

Erm... I like this idea *shrug*
We don't really need any new money but I'm sure they will be eliminating stipends soon

Why is this even being discussed? We should NOT have to compete with Linden Lab to SELL our fake money in order to monetize or efforts! The simple fact that MOST of our monetization goes to PAYING TIER is ENOUGH! MORE THAN ENOUGH!

Farther, Linden Lab already sells PLEANTY of L$ via stipends. I WILL NOT compete with Linden Lab in the currency market any more than I already do! I SIMPLY WILL NOT!

JUST SAY NO TO COMPETING WITH LINDEN LAB TO SELL YOUR CURRENCY! NOT THROUGH WORDS, BUT THROUGH ACTION!


What can we do? Well, I think that it is now time for one of the following:

1. A second world currency, created and managed by residents.
2. A USD micropayment transaction platform, created and managed by residents.

Who will rise to the occasion? I will help with the programming, if needed/desired, but I do not have the free time to administer such a beast.

Honest question: what would be so dramatic if this happened - as long as it would go hand in hand with a reduction of the price for Premium Membership?

You would simply pay a (lower) fee for the right to own land, the 512 in free tier and maybe some more goodies that only Premium Accounts will be entitled to. And all the money you need, you would buy at the LindeX. Actually, sounds much more plausible to me than the current model.

If you ever do, please choose option 2. Having to juggle two currencies (and an additional one, if you are living outside the US) is more than enough fun already.

I'd vote for a USD micropayment transaction platform - it would have implications outside of SL, and be far more useful. Something that worked on percentages rather than fixed fees would be perfect.

The big problem comes down to trust - can we trust the provider, and can users trust them?

heh eliminate dwell payments et al to create a space in the economy for L$ they can sell. Nice! I also like the micropayments idea.

That's acceptable to me, as long as the exchange rate rises to about L$361/$1 - which is what I believe the stipend actually works out as - and stays there.

The question does, however, arise that if dwell is eliminated, what is the advantage of going premium when you can simply rent land on a basic account? We NEED more reasons to get people to upgrade to Premium, regardless of the stipend issue... and killing stipends makes Premium even less of an attractive option.

It's funny how nobody has yet cried out about 'market manipulation' by this tactic of LL, which is what happens every single time the L$ value hits L$3001.

Lewis

If, in the future, all money coming into the economy is purchased, rather than given away through stipends, dwell etc., then what's the point of having L$ at all? Surely it would make much more sense in that situation to just use US$ and end the L$ currency.

Wouldn't it just be an unnecessary complication to keep it? Also, wouldn't it have the effect of Linden Lab not having to create artificial sinks in order to balance an artificial economy? They would no longer have to worry about an economy within Second Life, surely.

I totally agree, but I can't ever see it happening. Can you imagine the trouble it could create when content is lost, paid for with US$, due to data loss? Not to mention the complications it would add to their books.

In the light of recent developments this comes as little surprise. SL is looking less and less attractive day by day...

But the line's already blurred and, with the Lindex, many people are basically paying for content with US$ anyway, via the Lindens they've purchased. I know people may see this differently than paying directly with US$ in the first place - but the difference is slim to nothing in reality.

I'm not actually sure what complications it would add to their books. They're already dealing directly with US$ through the LindeX so again it's simply an expansion of that isn't it.

I dunno, I find the idea of a play currency kind of silly with the way things are going. They could stop worrying about the economy completely if they dumped L$. All they have to provide is the micro-payment, which isn't difficult. You charge your account up with US$ and LL can handle the micro payments easily at no real cost to them so selling something for 1 cent wouldn't be an issue.

Don't get me wrong, I wouldn't expect this to happen straight away. But surely it's the most sensible way to go in the future. L$ just seems to be losing relevance, which I don't see as a bad thing.