Over 2,000,000 L$ at 300!!!!!

(how the world changes, a year ago I shouted blue murder when LL drop the event funding) now I'm shouting for people to pay to go on the event board? (wonders what happend to her socialist up bringing (blames Mrs T).

I don't think its chairs, I don't think its events, it has to be the stripend. Every week millions are pored into the ecomony, and most people then buy stuff from a group of developers or land barons, they need USD not L$ so they cash it out! and as Kazanture said they have to do that to afford tier.

OMG I'm agreeing with RBD (although never disagreed on the forums just in my head). But s/he is right... There is too much money in SL, what goes in has to come out. 364L$ (or what ever it was) will be the breaking point where Land Barons will go bankrupt (well no one can afford teir) ...

I'm glad I'm out of the land business... oh yeah I sold my million at 270... (wipes forehead!).

x

I'm sorry, but I had to sell a chuck of my L$ before it was
too late... But hey, that is the market.. Deal with it...

If "The Market" can't support the high lofty value of the L$,
logic dictates that a correct is due. And if until Linden Labs
updates their Economic Policy to stop flooding SL with newly
minted Linden Dollars every Tuesday, this problem will NEVER
go away....

STOP ALL STIPENDS and this problem will be resolved overnight.

Easy... You have multiple Alts Selling... Duh!!

Not really. the general gist is sinks eat more than the stipiends put in.

The problem is people continually self devaluing the linden versus the us dollar in order to sell quicker.

Besides, the stipend is paid for as part of premium - Imagine half the premium users of SL tiering down and going basic over a weeks time.

Yeah, LL would be REALLY happy.



I suggested a drop off point of 2-3 months. Enough time for a newbie to decide to upgrade or not. Enough time to set up alternate source of cash..or not.

I bet RBD is the one who dumped the 2 million lindens just to prove "his" point. Then again it could be a well known land baron. I'd go with RBD

While this is basically true in the long run of things, someone offering 2 Million for sale at 300 while the market is at 286 still appears very fishy to me.

On nearly any given day it is possible to sell 1 million L$ at current market cleverly in small chunks of 200,000 or 250,000 without bringing the price down. So this offering smells very much like someone trying to bring the L$ down deliberately.

It is very hard to believe that something like this is happening accidentally.

You don't have to sell, because you don't have to buy new sims. It is your decision if you do it or not.

If you sell 1 million L$ at 300 when you could get a rate of 285 by waiting a few days you are accepting a loss of more than 160 $. This is more than the tier for four sims for 5 days.

Kaz,

Linden Labs has a history of trying to increase content on SL to make it a more diverse and satisfying virtual place. They recently gave out a $4,000 USD fellowship to an art student (or will do so, not sure if they selected a winner yet.) But the point is, they want to make it easy for people to upload new custom content onto the server. And, how many custom textures are actually being uploaded? With all the ones that are available, so few people actually do so, and when you get into trying to upload some sort of masterpiece, like an avatar that uses 30 different textures in combination, or trying to upload a home-made mural onto your sim, uploading and re-uploading a texture 5-10 times to get it just right is already fairly expensive. Upping the price of textures would take away a few lindens here and there, but the people it would really hit would be those that are working hard to bring new content into the game, and I seriously doubt that is something Linden Labs would want to do. It appears to be against their nature.

As it goes, Reference $L is already offline. You no longer get any bonuses for recruiting people.. So that's probably roughly 5,000,000$L a month that is no longer being distributed onto SL.

Developer's incentive is sat to die out on April 1st. So that will be another thing cutting the amount of Lindens being given out by a large portion (as I am sure you, as a sim owner, are aware of).


Also, keep in mind that those people whom recieve a 500$L stipend are also putting in $10 USD a month. At a 300L/$1 exchange rate, that comes out to be $6.67 USD that you can get in return from the 2,000$L you can earn a month.
Otherwise, you recieve 50$L, not even a $0.20 investment now, once a week. And most free players find that the amount is rather limiting. Granted, that amount goes into the pockets of the big enterprises sooner or later, which decreases the value of the Linden. But it's something that SL needs to survive, because if everyone had to pay to play SL, many people wouldn't. If half the population of SL left, you can bet your pockets that SL would lose a lot more of its economy than the problem right now represents.


The fact is that Secondlife is still growing in population, while we have some people whom collected a lot of Lindens while incentives were around (a certain artist I know recieved an estimated, and perhaps underly so, 100,000$L from the reference procedure, for instance.) But, what we are going to see is that some players with money will stop playing, and we're going to have a small but steady income of new players to secondlife. There may be a lot of Lindens ON the market now. But LL is doing a fairly good job at making a balane where the $L will slowly reabsorbed. And they're doing it not by infringing into player's mechanics (textures, classifieds) which would hurt some people.. But they're doing it merely by taking away the bonus incentives there were before.


Right now, there is an influx because of the large amount of Lindens on the market. I fully recognize that. But the number of Lindens on the market will only decrease from this point on, and so we will see a stabilization in the economy.

The two things that Linden Labs could do to have a profuse impact on this, without changing in game mechanics, would be;

1. Cut off the alternative buying/selling Linden sites. Linden Labs can't regulate those and LL also doesn't absorb any of the $L that is being passed around as a result. Meaning, all the money stays on the market. However, if LL did that, then they would be infringing on the rights of other people. And as a common sense, if you are going to buy $L for USD, and then sell it, wouldn't you try to sell it at a higher price? Unless you had to, like some sim owners, you wouldn't sell it for less -- unless you are trying to purposely bring down the price of the Linden. And as I explained earlier, it is going to stabilize, so that tactic would essentially be useless unless you are able to exploit a very large portion of Linden repeatidly.. and off of those sites, it would be possible because LL wouldn't be collecting any 'tax'. Still, It would take a very large portion of money, and if someone were to have that much money, don't you think they'd have something better to do with their time? Okay. So there are some people from foriegn countries (like China) whom might. I know my University has had their web-grid hacked by Chinese students before. Granted, I'm not going to single out China, as a lot of Asian countries would do the same, and so would people in Europe and the Middle East and so on and so forth. And some foriegn teachers would consider 'crashing SL's economy by influxing the Lindex' to be a great economic report. But that's where you get into the realms of extreme maliciousness and cruelty and I am going to subside on the subject.



2. LL could consider buying a chunk of Lindens. This is a tactic used by the US Treasury, except in reverse. When the US wants to increase or decrease the amount of US currency, it will issue or buy back bonds. I'm going to have to look it up in my economics book later, but generally I think it goes like this (if memory does honor my efforts): When the government issues a bond, they are recieving US money in exchange for a piece of paper, that you could say is a piece of stock in the US government. Not that the US government honors its stockholders (besides big business). Essentially, the US collects its currency, decreases the amount on the market, and the value of the US Dollar goes up. Then, when the US wants to increase the amount of USD on the market, it will buy back the bonds, and there will be more actual currency to be passed around.
If LL bought an amount of its own currency from the market, now would actually be a good time to do so (considering the increased rates). The question is, how much would actually be needed to be taken off to have an impact, and how much would that cost? And how would that loss affect the rest of SL.


Overall, LL is doing a great job of what any business should do. They're managing a balanced market. They created a balanced market system that operates effectively after the incentitives are taken away. The fact that they did this without infringing on the players rights shows that this has actually been well planned out -- or the system was, anyway.
The investments that have fluxed the price of the Lindens... That's your classic invest to expand. It's hurt the value of the Linden, definitly. And maybe they over-did it.

The one group that is being hurt by this is the business portion, the people whom need to sell high amounts of Linden to support their sims. And in its own interests, maybe LL should issue some sort of discount to sims that are already operating to make up for the influx. With Developer's incentive going away, it actually appears that they are going to be hurting this group. According to the Linden currency theory above, however, granting discounts will not issue more Lindens onto the actual market, and therefore, won't directly affect the sell prices of Lindens.



The last thing to consider is that people are selling Lindens at lower prices than LL, because they want the business. This influx isn't something LL has direct control of, as of course they don't own these Lindens (unless they buy them). But would this be changed if there were less Lindens on the market?
I seriously doubt it would, because there are plenty of people selling Lindens at low prices because they can. Until people don't have the Lindens to do this anymore, the action will continue. So.. again, it goes back to shutting down the operations that make this possible, Linden Labs buying back enough Lindens to increase the price of the Linden, or waiting for the SL economy to level itself out.

Jesus, someone with a bit of common sense at last. We are getting thousands of new members each week all of whom are getting a ton of free money. Printing lots of money is inflationary. Camping chairs create free money and are inflationary, and camping chairs rarely go unoccupied.
By the way I had a socialist upbringing too and had no love for Mrs T (poll tax riot veteran). But being a red doesn't mean you have to cluelessly ignore fundamental economics. Even the most radical socialist doesn't want people to be given money for doing nothing.
There is an alternative to stipdend abolition though, we try to create greater productivity. This has a huge advantage in that it would allow new users to continue to enjoy their stipend and have fun. That might be possible by tieing in SL more closely with the web and allowing real-world businesses to inject money into a ready-made 3-dimensional interactive infrastructure. Or engaging in useful social, economic or computational models that have external value.
Either way, the status quo can't last much longer.

Told ya.

Cut your losses, would have been worse if you sat longer.

Losing some money is better than losing a shitload of money.

Your logic amazes me. And it continues to dream up these
hair brain ideas on why the L$ is crashing. Because you fail
to acknowledge the fact that Linden Labs is the Problem.

Until they end stipends, the L$ will continue to fall.

Hm. How come I haven't gotten 5,000$L for the 5 people I've gotten to play in the last month? Actually, how come I haven't gotten anything? I thought the Lindens for reference policy was over.

Hahahah, George, you are too smart for your own good.

While I wouldn't totally rule out a manupulation attempt, this might also be a completely legit attempt to cash out $2m at short notice...

Suppose you had a desperate need to take $2m out of the game in a hurry... if you post it at the current selling price, you'd pretty much be setting up a new roadblock and shifting the day traders to the next point up from you. The only way to - realistically - dispose of $2m in a short period of time is to price it so low that most sane traders would think twice about undercutting you in the interests fast turnaround. Which is possibly what's happening here.

The true test of current economic conditions will be whether the lindex subsequently manages to correct itself to low/mid 280s in the next few days... (actually, I just checked the current figures, and $1m has already shifted at this price - so those cheap L$ are proving all-too-tempting to somebody!)

More interesting speculation might be where this $2m has come from, and what motive somebody might have to dump it so quickly...

Somebody? How about anyone who actually wants money, and naturally wants the best deal they can get? I'm tempted to get L$25,000 for a plot of land I want.

Lewis

My point is giving example, it doesnt need to be texture price, find a new service, for example stuff exchange service, and take 3% comission as L$ like slexchange. This is an example too, i am not thinking on it and its results, its LL's business to calculate these things, they have the all data , not me. My point is they must find a way to take L$ from the world without damaging to themselves and to residents.

Yes this is a good act and L$ classified ads is a good act too, but they need more.

It was in USD not in L$ so it helps to economy only a little.



I dont want them to remove L$500 stipend completely, if they cant cut stipend base, find a way to take it back from the world.

I agree, i appraciate that they are taking away some unnecessary and meaningless bonusses. I just want to be sure if they are calculating the incoming and outgoing L$s.I dont care if the rate is 300L$/usd or 250L$/usd. I care about it to be stable. So me and many can plan their businesses right.if it stays at 300L$/usd +-5 for 6 months or at 250L$/usd +-5 for 6 months, both good for me as long as i see the market is at balance. Because devaluation is bringing uncertainity to my business in SL. When i buy 5 sims, i am setting all prices looking at the current rate. 2 days later rate is going +10 above. Unlike cloth designers or builders i have to change land prices immediately because i cant sell a sim under $1200 if i bought it for $1100, i am selling L$ to buy sim,For example sold 340000L$ for $1100 to buy a sim and set parcels to sell all for 350000(to pay tier and maybe a little profit.) But while parcels are selling if 350000L$ worths only $1050, this is a loss but nothing for me. So i am VERY dependent to exchange rate.

I am doubtfull about this, i was hearing same around christmass:
"All people selling L$ because of christmass, it will gain value again." For a short time yes, but there is a main problem, main imbalance, We will see L$ gains value for sure, but it will be temporary. Because L$ balance in the world is screaming that L$ will continue to loose value at long term.

Doesnt help


This is a very common exmple to RL goverment mistakes, if u take money from market, it will help the market temporary, but wont help to the acceleration of imbalance. And will be a loss for LL. This doesnt help, and doesnt work.

Yes LL is doing a great job, but in economics there is no "howto"of balanced market. Yes they created a balanced market but it is not balanced anymore. In economics you cant say:"ok market is balanced now, we did great it works well forever" you must take necessary actions every 6 months. If incoming L$ is more than outgoing L$ you balance the market via natural ways. If outgoing L$ is more than incoming L$ then you balance it again. But not buying from the market, but playing with service prices, mor with new services.


Ther WORST mistake which LL could do is buying lindens from the market to answer forum requests.

Right, but they couldnt if there was a higher buy rate than sell rate.

Right, but they couldnt if there was a higher buy rate than sell rate.


1-> Can you guarantee me when L$ rate will be back to 285? how much will i wait?
2-> 1 week?, this 1/4 month loosing 1/4 month with 5 sims free tier means 5X195/4=243.75 usd loss for me. This is why i(and some others) cant wait.

Who's buying this L$? I see lots of speculating, whining, complaining etc. If you're so sure that it's someone trying to "crash the L$", and that the rate will come back, did you buy any? It looks like it will all be gone soon.

Logic and reason are not good Drama Fun Makers™ Shaun!

A pox on ye!

All the Osteriches will tell you there is no problem.

But free money is great fun!

The amount at L$300 is going down quite quickly.

Though I notice that the number of sellers isn't.

Most of them are probably alts of the main guy. Notice all the silly orders above for L$900 etc? Most of the ones at 300 are probably the same. We should be able to see how much each order is for, rather than just the total at each price. In an ideal world we'd be able to see who entered each order too. It's a shame that they won't make LindeX more robust.

more sinks would be good, but they need to be done right..and suggestions would be welcomed

Part of the problem is the fact that the supply vs demand chain is reversed.
- Why convert massive amounts of L$ into US$? -> to buy new sims
- Why convert US$ to L$ -> to pay for services

All services related to the new sims still need to take off hence you've no users on the market who are buying the L$ to get the service. So you have a huge supply and a low demand. Once the sims are operational and pumping out rental/sale services the users will need the L$ to pay. Though at that time there may be a lot less L$ available on the exchange.

Given the huge amounts of sims being sold currently it's normal that huge amounts of L$ are offered by those people who want to buy those sims.

The solution can be to:
- Create auctions in L$
- Lower the supply of sims so that less people have use for converting huge amounts of L$ (this will slow down progress off course)

If Linden would like to manipulate the L$ themselfs it would require them to start buying and selling L$. Basicly they could take out the L$ now and put it back in at a better rate when there's more demand. Other parties would have too much of a risk simply because you need better margins due to all the costs you incur when converting.

Note that accepting US$ as payment for services outside SL may look as a good idea but it doesn't hold true if you get a lot of L$ from elsewhere at the same time. As allowing people to pay directly in L$ removes demand for the L$ you want to sell off.

Essentially if all sim buyers would opt to invest now (buying with available US$ instead of converted L$) and convert later (when they are selling stuff on their new sims) the downfall shouldn't be this large. But then again investing is dangerous because not as large may still mean falling.