SELLERS! Linden exchange OUT OF CONTROL!

Thing is, people come here reading the hype about making $100,000 a year playing a computer game. Who wouldn't be tempted by that? It's just a pity that people don't understand the amount of work (and the hassle of opening a chinese sweatshop) that it takes to turn that kind of profit.

But they come here, find they can't, and log out never to log in again. It's like any other game, be lured in with screenshots and promises, if it lives up to them you carry on playing; if not you don't bother. It has to have what you want from it. Take Jumpgate Online, for example. It's a space combat/trading game; I really enjoyed it but being a mostly US based game there are hardly any others around during the UK times that I tended to play, and as much of it beyond about level 5 alien craft it's virtualy impossibly to destroy without having other players to help you (kinda quest-like) then I gave up.

Maybe the huge increase in account numbers is because people are finding out that SL doesn't live up to the marketing hype that drew them here, and quitting - because the overall population is not increasing in line with new accounts. A new marketing tack may just bring in proper residents who will contribute to the community, and stay.

L$312.34

Lewis

I wouldn't describe a person who's interest is in business as not a "proper resident", nor would I say there's any reason why they aren't also capable of contributing to the community. Some of them may well prove successful by some measure, and stay. I'd just like to see some additional marketing directions with a similar level of exposure. It'd be interesting to see the effects of something like an article on relationships in SL in a magazine like Cosmo for example.

I'm differentiating between

"I'm here to make money"

and

"I'm here to have fun, and make money"

and

"I'm here to have fun. If I make money, it's a bonus".

Certainly other advertising tacts would be very useful. I strongly believe that there is so much potential in SL that by, concentrating on just the financial aspect, people miss out on.

Incidentally, it seems like the L$ has peaked and is now down to $312.30 on the chart, so I just bought $5000 to sit on and make a tidy profit. Isn't this fun?

Lewis

Too soon to say it's peaked, I'd say, but anyway... I'm looking to 'profit' by getting great value in world from people who's prices haven't gone up with the Lindex!

The influx makes buisness less profitable in SL and thats the only thing that bugs me

This situation reminds me of when the pice jumped down to 300L a usd. I hope it dosent stabalize at this high price.

another thought is that mabey when dwell is removed the sales at the low prices will go down because less poeple will be getting the extra L$ from LL?

That fixed rate of selling linden dosent sound to bad right about now this is killing me....Plus if they did the fixed rate and somone wanted to sell for less let them go to ebay or somthing

Through Lindex, you have protection and a pretty good knowledge that you'll get what you paid for.

Through any third party source, you're screwed if anything goes wrong.

Although a fixed rate does have certain advantages, I'm not sure it's the right solution.

Lewis

A fixed rate could kill you too. If demand for the L$ falls, and the price doesn't adjust to meet the change in demand, your L$ won't sell very fast, you'd be in a rather large queue.

True...I tried ebay and got ripped off before. But if the fixed rate was installed and people relied on ebay the prices would stablize on there too because the people buying to resell on ebay would have to pay more, unless they were a buisness owner. You would think the buisnes owner wouldnt want to sell for less value when he can sell it back to LL at a better price

Siggy, I couldn't agree more. It's about time someone mentioned that there are fellow residents that are doing well off this. Shouldn't we be happy for them and the fact that they are buying? Isn't shopping what makes the economy work after all?

That said, I still say that the LindeX is flawed at a basic level, but that LL seems to be trying to fix this with their latest move. As I stated in another thread somewhere, if anyone had bothered to read the material Robin provided with her announcement post (which to date, no more than 200 people have done) they might understand some of what they're trying to do.

Your right fade the demand might fall but i remember when the price of Linden was 280 a usd and the demand was still pretty high. people might get upset they cant cause a mass devaluation.. I think there would be a stable demand for it mainly because of all the free acounts and land purchases, Theres tons of people that buy the L to purchase somthing or pay the rent. The major effect of it though the people buying L to make a profit might not be able to do it anymore...

I don't think anyone makes money on L$ speculation. Its just not profitable enough. Example:

Someone buys up all the L$ that is undervalued by public perceptions. As I check the LindeX page, thats :
$309 / US$1.00 L$191,282
L$308 / US$1.00 L$717,504
L$307 / US$1.00 L$397,896
L$306 / US$1.00 L$365,938
L$305 / US$1.00 L$1,933,048
L$304 / US$1.00 L$475,037
L$303 / US$1.00 L$692,981
L$302 / US$1.00 L$417,369
L$301 / US$1.00 L$1,132,841

Divide each amount of L$ for sale by its respective "exchange rate", add them all up and you get a total USD investment of $20,774 for 6,323,896L$. Even if somehow, miraculously, the rate were then to fall from 300L/$1 to 270L/$1 (which it WON'T), and you were also able to sell off all those L$ for 270, your return would be $22,585. A 8.7% return which admittedly would not be bad....if it were possible.

If you went for a more reasonable expectation (still not *likely*) of about 295/1 your profit would be $21,437, or a 3.19% ($663) of return. For the risk involved and the time and effort required, i'd say not worth it.

Of course, its not really speculation when the LindeX isn't actually a currency exchange market....but I won't get into that again because I tend to kill threads with it.

Lewis, if you will just look at the amount of Lindens above 305 to 1 you will see the reason for this. Last night a 11:30 there were only 170K above 305 to 1 and since then 2,402K have been posted above 305 to 1 when only 906K have been bought. Wait until about 2PM SL time when over 3,000K should be bought and look at how many Linden are sitting above 305 to 1.

Also remember that because of the shortened day yesterday 1,500K less Linden were bought than on average.

I think that it's pretty cool also. I'm tired of all the whining about depreciating L$ values personally. Anyone who wants to squeeze an extra buck should increase their prices and put the squeeze on their own customers, rather than trying to squeeze all LindeX participants out of liquidity (sellers) or a great deal on L$ (buyers) so they can get a better rate. Some of us have a tier bill to pay.



This can be an excellent strategy for some. I perfer to index prices to the L$ rather than gamble on it comming back to whatever arbatrary rate my prices are designed for. But then, in my situation, I don't have a lot of choice except to price in strict USD terms. I think your strategy is terrific for a content business with a large margin over tier.

More people who don't need immediate liquidity should hoard L$. It would possibly even lead to increased stability if everyone did this.

Shaun the amount of Lindens currently being hoarded is probably very high and therein lies the danger. What if 10% of those people decided to sell at today's rate?

Not really. There will always be those that take advantage of the flawed "currency exchange" to price their L$ just below the next person. Of course i'm not recommending everyone go out and panic-sell. I think even if we don't see a rate that we want come out of these new LL policies, we will at least see some stability from it. In other words, it won't be resident hoarding that cause the rate to stabilize, it will be LL policy eventually.

With current L$ trading volume, you MIGHT be able to make some money if you were willing to attempt a real, legitimate run on the market. Just buying everything from 309 to 301 won't even net you enough to beat the transaction fees. You'd probably have to spend a month or two buying hundreds of millions of L$ carefully and quietly.

After you've bought a large percentage of the total float at a price around 300, you could make a single large buy, securing a GREAT average price on this buy, and sending the price skyrocketing to 200 or so at the same time. Then, start dumping L$ like it's going out of circulation, because in theory it practically is at this point. Who knows, it might be profitable. This is an awfully big MIGHT, though.

This is about the only way I can see to possibly make a big killing speculating on LindeX. Another approach, which would require much less blood pressure medication than attempting to corner the market (), would be to trade on the SLEx currency exchange, where your spread is usually high enough to beat the transaction costs.

Ok so I was too lazy to work the math on the amount of L$ needed to make a real profit. My point, which you obviously understood, was that the amount of time effort and money needed to make a real profit just isn't worth it when you're talking about an exchange rate like this. Not to mention the fact that there is always that risk (remote as it may be) that SL will shut down (Don't grab your pitchforks! I'm saying its NOT LIKELY) and we would lose everything. Just like the RL stock market if it crashes.

I seriously doubt that L$ will go 'out of circulation' though. Why would it and how in the world would it be replaced? It just doesn't make sense.

Does anyone see a problem with capping the exchange..at like say 315 for example..

What if IGE cashes out of their L$30-L$50/million Linden Dollar Position?

Explain Capping? Because to me, what you are suggesting is
that some White Knight is going to open their wallet of USDs and
buy every 1000 block of linden dollars for US$3.17. If you figure
a volume of L$5/million a day, that comes out to almost US$16,000/day.

Are you going to "Cap" the price? Or do you expect Linden Labs to
fork over their USDs to cap the price?

Actually, while capping the market is NOT a good idea, it wouldn't cost LL much. The only thing they would lose out on is the transaction fee of those who decided not to buy or sell because of the cap.

If they did that it could cause a panic depending on how it was done. Currently there is at least 7,000K new Lindens being offered evey day at prices near the previously executed exchange rate so the sellers can sell quickly. If buyers buy much more than 7,000K then the Linden will rise in value due to the exchange rate dropping but if there are less buyers than sellers (like yesterday because of the 5 hour downtime) then the Linden falls. So if IGE tried to sell only 1,000K per day in addition to the 7,000K already being offered there would be a continuing erosion of the Linden. If IGE offered all L$30-L$50/million of their holdings at any exchenge rate the 7,000K being offered daily would simply raise their exchange rate to keep selling on an daily basis. I see IGE as stuck selling on their own exchange.

LL could also stop accepting L$ for sale in random, unannounced intervals, say every few weeks (while buying $L would still work). A pause of 2-3 days should be enough to bring the exchange rate down 30-50 points. Sure, after such flush, things would go back to normal but at least it would combat the constant downwards spirale of people undercutting each other.

This sounds too speculative to even make an intelligent comment on. What if 10% of an unknown number of people sell an amount of L$ that nobody could even take a good stab at guessing.. at today's rate? Well.. I dunno!