Holy Falling L$ Batman! L$ now at L$285 per USD $1

You're right. I ment to say that they would have to buy back an amount in proportion to the number of users in the game. IE, the "average" premium account should have say L$20k, while Basics have L$400.

It would be almost impossible to calculate exactly, but as long as they were in the right ballpark it would work.

So, if there are 50 premium and 450 basic accounts, there would need to be 1.18M Lindon total in everyone's pockets. As the game grows, and you get 5000 premium and 10000 basic accounts, there would need to be 104M Lindon in the game.

As more goods and services are created, you would expect people to buy more, but that won't affect the price of the Lindon because it would be transfer between players. Eventually, the sellers would end up with an excess of Lindon and would put it up on the market where they get bought and put back into circulation.

Since someone else mentioned that LL won't buy back Lindons on the market, the only real solution to me appears to be to cut back on the allowace and bonuses until the fees built into the system balance out. Unfortunatly, this would most likly have the side effect of stagnating sales, as people are generally more reluctant to put more cash into the game to buy the Lindons they need to purchase stuff in-game. It's a lot easier to spend the 500 Lindons you got for free at the beginning of the week than it is to put $2 real dollars into the market, especially if it's just some in-game pair of pants or something.

I can see why this problem hasn't been addressed yet, it's a tough one.

I suspect the current L$ drop is because a lot of L$ from savings have been concentrated into a few hands (Player A) who need to raise USD quickly to pay for their recent auction wins. They are selling into a L$ market that doesn't have any pressing need to buy them.

They are? I guess the Lindons must be more subtle than I realize. Do you have any specific examples?

Um... actually LL already does this in a way. They have a target for how much the average account should have in lindens and massage the money supply (remove sources of income, introduce new money sinks) to try to maintain that average.

Examples of removing or adding money sinks to manage the SL economy, as you alluded to in the post I responded to.



You mentioned the classifieds, but that doesn't seem like it does much in the grand scheme of things. I guess removing the Developers Incentive would count.

I doubt one wealthy person or group would dump, dump, dump on a soft market, then dump some more.

The larger land barons are big, yes, but are they big compared to the rest of us?

Say roughly, 100 barony sims -vs- 1000 independent, patchwork sims.

Damn, didn't edit my post in time, someone saw my misconception. I'm now actually worried about the L$ though, I don't see any mechanism for it to actually recover. I must be missing something.

Well, I don't know, they must have to get rid of a lot of L$ currently, but it's hard to know how that compares to normal transactions. Plus, once a run on the bank gets started, it has it's own momentum.

My point in any case was that LL creating new land for USD auctions has no impact on the supply of L$.

If there is farming - perhaps the perpetrators cash out at *any* $L rate quickly, before they are caught?

except that farming is a completely legitimate activity according to LL. and profitable. LL sells L$ with stipends which are then cashed in for a better rate on the Lindex. LL makes money and farmer makes money, content creators and service providers lose money.

Anyone who looked at more than just the price could see PLAINLY what was happening. When the L was at 285 volume was less than 1 mil and there was a trickle of small pricing increments down to 285 as people tried to sell first. Only 1-2 mil listed. Needless to say once volume picked up the linden fully recovered. Score one for clueless panic ROFL!

While I applaud not giving in to needless panic, I would like to point out that every time such a "mini-panic" happens the L$'s value comes out a little lower than before. The last months have seen a de-valuation from 252 L$/US$ to now 276 L$/US$ - with additional peaks. To say that "the linden fully recovered" is a very liberal interpretation of the events at the LindeX.

A 10% loss in value might not seem very relevant for Joe Average or even profitable to the "clever guy" who uses every one of these events to get some L$ cheap. A 10% loss is a lot for all businesses dependend on getting US$ out.

And if you look at economies in the First World, it has never been a sign of a healthy economy when the countries currency constantly loses value against another currency with which it has a large trading volume. If your country is very export oriented, a government can use a falling value of the country's currency intentionally as an easy way to fuel an ailing national economy. This never works for long and usually leads to a bad ending.

I am not saying that this development is irreversible. It isn't. But it surely is nothing to laugh about, either - even if you made a nice windfall profit.

one thing i'd like to point out to as well is the number of 'REALLLLY' far out outliers, all those floating red lines... there are a not insignificant number of people who either really don't know how to use the system, or are actively *trying* to alter the $L's value by consistantly and determinedly posting far far lower than the current value at the time, almost every day

Unfortunately those graphs don't provide enough information. And actually don't look too bad. While yes its abundantly clear that the L is currently in a steady fall. Those graphs don't illustrate a regular dip. Wouldn't those graphs look worse if I posted 500L at $500/1 every day? The fact the avg line closely hugs the high line suggests those dips are mostly low volumn dips. I think the fact everyone knows the L is in decline and there is no profit to holding L's has more impact than even regular wobbles like this. Buyers don't panic when they see it go down and sellers are convinced by larger trends/factors to sell all they can.

If you list L$500 at a rate of L$500/US$ it would affect the exchange rate in the second decimal place (i.e. with L$4,000,000 sold at an average price of L$265/US$, your order would change the average to L$265.029 over the course of the day). The graphs would be effectively unchanged.

Once Lawrence posts more recent data, one can easily calculate the mean and volatility of the returns to see a significant downward trend affecting prices to the extent that a rate of L$300/US$ is quite likely within the next, say, two months.