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

Exactly.

Hold on guys -- trying to get some clarification here - if LL is crossing 'block trades' of currency outside the Lindex system, then that is radically different than what I thought they were doing, which was balancing the money supply.

Just gathering information - then I'll be happy to respond specifically.

Thanks..

The LindeX and the print-on-demand currency system CANNOT exist together.

Which system do you think will be used within the client when someone clicks on that "L$" icon? Do you think it will use the system that earns Linden Lab 3% of the sale or 100% of the sale?

From a business standpoint, we all know which system the Lindens will have L$ purchases coming from, because they would be STUPID to take a 3% cut over a 100% cut.

Which is why this announcement, and immediate change of the TOS, should be a buzz-killer for LindeX traders.

The TOS change permits them to sell L$ directly.

Someone wants to buy L$5,000? They pay Linden Labs directly and the L$ is not purchased off the LindeX, not bought from another user, but created out of thin air, and then sold to the user at a 100% profit to Linen Labs. They don't even have friggin' overhead. They updated a database table and created money.

That makes no sense - and in Robin's announcment there is no specific language about 'sale'.

I still maintain its money supply regulation, and not crossed trades seperate from Lindex. Why would they obviate the need to use Lindex? It just doesn't make sense.

Any linden clarification would be welcome.

Nope Maxx, it's to do with basically undermining their own currency exchange market I guess. If they're selling L$ and you can buy L$ on the Lindex, they're competing with their content creators who are trying to sell their L$.

Much depends on the rates they choose to sell L$ at. If they undercut the current Lindex rate, then people will be more inclined to purchase L$ directly from LL. if they don't, then that kind of defeats the object of using it as a way to increase the cash in circulation.

The same could be achieved by tinkering with stipends, on a week to week basis, but then they're creating L$ without getting any money directly for them. I can understand why they'd find this a more attractive route, but it does seem to raise the possibility of making it difficult for others to sell their L$ when Linden Lab decide they need to sell a load.

Hi Cheyenne, nice that someone is listening. I was not saying, that this is a good thing per se. It is nothing unusual, though, and has been done by LL in the past, to create money out of thin air and use this to pay for its own debts.

If this is healthy for an economy completely depends on the rate at which money is created. Please read the articles Robin is referring to in her post. They are quite enlightening. Most economists agree that a slow inflation is good for an economy, these days.

What I said was, that I find it hard to build the analogy between the (widely accepted) ideas put forth in these articles and the reality (sic) of SL. In First Life monetary policy is directed by a more or less independant Reserve Bank in most successful economies. And that (and a working banking system) is missing in SL.

But, please don't forget: For now Linden Lab has not implemented any changes in their way to create money. The sky is not falling yet! Why not wait a moment before more details of their plans for new institutions and policies are published before declaring the imminent end of the SL economy?

Yep, that was me a short while ago. I just don't know what I will do as a business fox, if things get so out of control that we can't trust the government any longer. Linden Lab selling L$ on LindeX will go a long way towards totally destroying my faith.

There's no mention of balancing the money supply in the announcement, or buying L$ if necessary, just "enabling" LL to sell L$ when they "think the economy can absorb a new infusion of L$", which is different to 'when it needs it'.

Ermmmm:



"We are considering the sale of L$..." - that seems like they're saying they're considering selling L$, doesn't it?

I'm wondering if this is a response to the possible threat that some players are articifally driving the $L down now, buy $L cheap then monopolize (or form an OPEC like organization) the $L supply in the future once the excess supply from dwell (and possibly stipends) are shut off.

With the threat of LL being able to print money if the supply is too tight, this discourage such plan.

Just like EA's "coming soon" .... means nothing.

If it's got as far as being made as a change to the ToS, then they have their plans already worked out, and it's just a matter of time, not if.

Lewis

"We have also made a change (see paragraph 1.4) to enable the L$ sale by Linden Lab . We are considering the sale of L$, but only within the context of smart economic policy. In other words, we will only sell L$ if we think the economy can absorb a new infusion of L$ because either other sources have been reduced or sinks have increased."

I think you'll find the EXACT language is about sale.

Ok guys - I see the 'sell L$' sentence in there, of course -- but it doesn't say to *whom*. I guess that is what Lindens are for, to clarify.

If it is indeed selling L$---->Joe Newbie, then I'll be pretty suprised.

If it is instead selling L$--->L$ Money Supply regulation, then I'd be a little more relaxed.

I guess it comes down to whether the outstanding money supply is adjusted, or they put up a site with blocks of L$ to sell, independently of Lindex, or, put up blocks directly on Lindex.

I think another Linden statement would be helpful, in any case.

Heh. I wish I could, but I already have a full-time job, part-time hobby, and need to still squeeze in time for sleep and food.

Lewis, I rarely agree with you, but having been here nearly 2 1/2 years I read that exactly the same way. Things are often "experiments", or "we trying this to see how it goes" or "we might do this" when, in fact, yes they have already decided to do it and will do it.

This is just breaking us in gently. Kind of like announcing it as a TOS change when, in fact, it's actually so much more than that

I'm still not sure about whether this is going to be harmful or good. People may have more L$ to play with, but converting that into US$ may be more difficult (something I know you're not bothered about )

Out of my arse prediction - lets see if I'm wrong.

An assload of people will read this and say 'HOLY FUCK!' and offload L$ as fast as they can - undercutting each other faster than the political commercials last election..

...lets see!

If the majority of content creators feel the way you do on the long term, then SL is likely to go belly up IMO. I would still come to SL to play around with making stuff, but I wouldn't pay $195/mo to do so. Nor would we put out any new stuff for sale.

I'm supposed to put a new two-person animation that Ferran did this week out today and frankly I'm thinking my time could be better spent cleaning the bathroom.

The plan itself sounds brilliant. However, watching this movie (9 hours total) will give you a much better understanding of central banking roles and inflation.

Part 1:
http://video.google.com/videoplay?docid=8442305921010099392
Part 2:
http://video.google.com/videoplay?docid=5020331178524208549
Part 3:
http://video.google.com/videoplay?docid=3510313821923167501

One of it's kind documentary on banking's role in the financial world. Highly recomended for educational use.

over 2 mils for sale above the L$300 mark.

I think it made an impact.

YEP, but it will surely keep you away all the way, starts at the very beginning before money was founded, then to moneychanger period wich jesus tried to kill (and failed so far). Then all the way till now. One of my favourite's.

Call it the Godfather movie about money, if you will

Yup up 5 points!

sorta makes me laugh - I've been watching the Lindex flatten and start to look like it was going to start maybe even coming down a slowly.

And then an announcement for 'helping the economy' sort of bent it over without lube or a reacharound

Good one!


If the folks who print the money - sell the money, no matter where or when they sell it, they are directly going up against thier own residents... something they said they wouldn't do.

Just remember one thing: Without us doing our thing - all you got is one huge empty canvas - the 'compelling content' people come for is made by us.

The creativity thats showcased that draw in the artist types to try their hand... thats us too.

The Newsweek stories telling of how some folks are making their fortunes in cyberspace.... us...

Don't bite the hand that feeds you
Don't eat the goose that lays the golden egg
And above all
Don't shit in your own nest.

The stipend is part of what you're paying for. If you're not getting the stipend, that's exactly the same as a comparable increase in the price of the account. If it's still worth it to you, fine, but that's your choice... what choice will most small landholders make?
They're MAKING it harder and harder. They could make it easier on them by making the Linden Economy work more like the real world economy, with a variety of money flows. Instead, they're making it look like the tulip-bulb pre-2000 Internet.

Just make one denominated in US$ that calculates the average of high and low Linden rates for the day, adds 3.5%, and sets FastPay to that value.

If the Linden completely collapses you'll still lose out, but that's a "game over" situation anyway.