Step 1: Eliminate the Basic Membership lindens giveaway effective now!

Already a lot of new players give up quite quickly and quit. The whole reason why capitalism is the only economic system that works is that people don't automatically think "well, I guess I'm getting a lot of free stuff here so I should give something back". People will buy stuff, but only if you make them want it, and at the moment they first rez into SL, they have to want SL before anything inside it becomes desirable.

Another point: SL has always had the L$50 stipend, so why should it suddenly have started causing inflation now? What's caused the inflation is a) the rush of subscription free players logging on, spending their starting L$, and then quitting, adding L$ to the supply without generating demand; and b) camping chairs and other things mobilising the "dead" L$ in rich players' accounts, which were otherwise sitting there and not being cashed out (so adding no supply); when redistributed, some of them wind up in the accounts of the players who do cash out, so they do wind up in the supply and cause inflation.



Sure they are! Imagine that, in the real world, you didn't have to eat. Ever. But the government paid people to eat anyway - so that other people would spend more money opening restaurants. That's the equivalent.

I was sitting here and thinking about this thread and realized that I've always thought of stippends on a weekly basis and haven't extrapolated that out over a period of time.

At L50 / week and the current market exchange rate, LL is paying out about 80 to 85 cents a month to people who are not paying to play this game. That comes to a total of $9 to $10 a year.

Huh? Linden Lab is paying people $10 a year to play their game for free? How does that make any sense whatsoever, especially in a market that is currently flooded with L$.

If we set personal greed aside, there is just no reasonable explanation for this. People might claim that these users contribute to the game in one way or another, and they're right. Basic users often contribute to the game. But that doesn't mean that contribution would cease without that L50, nor does it mean that LL should be paying them for merely existing on Second Life.

People have claimed that LL should have "other sinks" in place rather than removing that stippend. What they're actually saying is "Leave us freebie players alone and stick it to the poeple who are actually putting an effort into SL". Because one way or another those excess L$ are going to have to be removed, and if it's not from the non-paying freebie players, it's going to be from those who are putting in their time and effort and money to make this game work.

Again, it's the landowners and merchants that are paying for your free play. And now they're to be expected to pay more so that others can goof around and be handed L$ for doing nothing? That's just plain nutty.

Yes. They pay them to create the attractive business climate.



And guess what! It's the freebie players who are paying for the landowners and merchants, by buying their stuff!

The question there would be why... and I doubt it has anything to do with the economy. I would believe the vast majority of it is due to being attacked by griefers (it amazes me that LL doesn't seem to understand just how much in RL$ griefers cost them every day and have cost them through the past. They just continue to be soooo tolerant of people who regularly cost them legitimate members who get fed up and leave and tell their friends what a sucky board Second Life turned out to be. Griefer tolerance to the cost of valid members and reputation is just plain goofy.)





So if they're given a complimentary L250 when they join and buy a few things and run out, knowing they won't get any more unless they contribute either activity-wise or "buy more L$" wise... suddenly they are forced to become contributing players-- or do without. I would bet dimes to donuts they'd quickly figure out a way to gain more L$ if they want such all that much. Myself, I think I spent L10 the first 3 weeks I was here... and I had a blast.



As one user accurately pointed out to me, it's not caused inflation per se (at least not ingame)... it's caused a decrease in the value of the L$.

But to answer your question, it takes time for currency to increase to a quantity that it will affect a society. If you dump a few needless L$ on the economy every week without any effective way to remove it when the time comes, that is going to build up over time until there is a glut. There is now a glut. So people are now discussing ways to remove that glut. One of the most obvious is to stop dumping vast amounts of L$ on the market for needless reasons. Thus the concept of removing the basic stippend. That's nothing but dumping excess L$ to non-paying users in an already flooded market, discouraging them from purchasing those L$ themselves and helping to remove that glut.



Where are these legendary L$ in rich player's accounts? IF there are such... those L$ are not affecting the economy. They are not adding to the glut; they are sitting where they are doing no harm. If they ARE sitting in "rich player's accounts"... perhaps that's precisely because that player is smart enough to know that if he tries to dump them, he will further damage an already damaged economny.

And just so it's said: there seems to be a lot of vehemence against "rich players". I might remind folks that people get rich by working, which to me is a lot more honorable than insisting Linden Lab hand you free money. (I am by no means a "rich player"... but I certainly respect the fact that most of them have put in a LOT of time providing services to others on SL in order to get that way).



That's quite a bit of imagination. I will agree RL government subsidizes things all the time. But a few points: 1) SL isn't RL (see my sig. ) 2) Governments aren't necessarily the most intelligent entities on the face of the planet 3) Why would Linden Lab have any need or desire to waste its resources on such a concept when there are so many more valid ways to give the economy a jump-start?

Freebie customers create the attractive business climate? I find that hard to believe. I'd have to say it's those who pay through the nose for Second Life that contribute to the climate, both in sales and purchases. There are exceptions of course... but for the most part, freebie customers have no land, no place to build, no place to display. If they do decide to merchant, they probably don't give a hoot about whether they get a 50L stippend a week or not; they're working for their bread.

As for freebie players paying for the landowners and merchants? As a favorite orc friend of mine would say: HAR HAR HAR. HE MAKE GOOD JOKE!

If they're too cheap to buy L$ and too lazy to earn them in some way, how can they be paying for anything above the L50 LL is giving them? And since that L50 is part of what is contributing to the devaluation of the L$ (thereby making L$ worth less in the sales market)... they're paying for squat. If anything, it's more likely that they're actually lowering the potential sales values of merchants and landowners and just like in RL-- they're a drain on the economy.

That's a good thing. Having extra competition doesn't create an attractive business climate - it makes it worse. What creates the attractive business climate is having a large number of customers who have money they're prepared to spend.



Of course they do! Remember, the only way L$ have ever entered the economy is through stipends. I've heard of a player, who wasn't a "big name" creator but well known, having L$500,000 in their account; that's a year's stipend for 192 basic players! SL has only been going so long; if there weren't new players around claiming their stipends, those L$ wouldn't exist to be in the accounts of those merchants.



Because there's lots of them, and getting a stipend encourages there to be lots of them who stay!

???

My understanding - and it may be wrong, as I don't know how things worked a long while back - is that the only way L$ are created is for stipends, for starting money, for dwell, and for things paid for in L$ by LL.

Again, I believe - and I may be wrong - that SL has been going since 2002. I don't think it started in January, but let's say it did to err on the positive side. Jan 2002 to Jan 2006 is 48 months. At L$200 a month, that's L$9600. Now, I recall reading that they got L$750 to start with early on (the L$250 I understood was a recent reduction), so that's a total supply of L$10350 generated by this user.

Now, how about dwell? Dwell is paid direct from LL, but it's generated by individuals. As we know, that user generates 1 point of dwell per day, and he's been around for about 1440 days. We don't know how traffic is mapped to L$, but it's certainly at a lower rate than 1:1, so let's call it 0.5. So that's L$720 in potential dwell, for a total of L$11070. That's if a Basic user has been in the game from day one, has played SL every single day since it started, has never uploaded anything, and has spent 5 minutes or more in every location they ever visited.

Now, a common ambition among users is to be able to pay island tier in L$. At the normative exchange rate of L$250/US$1, that's about L$50000. Since they will be a premium user they will generate L$2000 of that themselves, leaving L$48000. For there to be enough L$ in the economy to get that - by buying, selling or whatever, none of which generate new L$ so the L$ must have been generated elsewhere - consumes the money supply contribution of 4 Basic players.

Have L$500000 in the bank? You've reduced the money supply by 45 Basic players' worth. And remember, this is Basic players who've played from the beginning and are still playing.

Now of course, there is no shortage of basic players. But if you kept adding players without adding a little money to the economy for each one, sooner or later it would run out, and then things would become very difficult for everyone involved..

I have to agree with a prior post.

???

While it might be argued that stipends are the primary way in which L$ have entered the economy, I remember a promo video contest that LL had. Although they claimed they would never use L$ to fund their business... do you think they paid the winners in US$? They were supposed to, but in the end run, they paid in L$. They were funding their promotional activities by flooding an already flooded market with hundreds of thousands of L$.

Now, that's their decision. I'm not going to tell them they can't do that. Hey, I earned some heavy L$ from that one. Woohoo! Do I think that was a good move? No.

At one time Yumi, stippends for non-paying members might have been a good idea. New businesses often need to use quick-influence gimmicks to get people's attention. A new store might sell chickens for ten cents a pound to get new customers. That doesn't mean they should always sell chickens for ten cents a pound. Sooner or later, adjustment needs to be made. The argument several are making here is that the idea of a weekly L50 stippend to non-paying members has out-lived its usefulness and has now become a problem to the economy.

I can't say with 100% certainty that is the case. There are many variables involved. Perhaps the only way to tell with certainty is to remove that and see what happens. Sometimes in business, one has to take a risk to see if it pays off. I would tend to think that this might not be the only thing needed to bring the economy back to a stable level.

I think what you're viewing here Yumi is a single-action limited-activity scenario. That's not what anyone is presenting, best as I can tell.

You're taking it for granted people are advocating removing all stippends from all players. Far as I know, that's not the case.

New players would still be given L250 just to get started. That would add L$ to the economy, sufficiently that new players would benefit.

Paying players would still be given weekly stippends. In that case, LL isn't giving them anything; that's part of what they're paying for. The Premium membership pays for a small piece of land and an allowance of L$. So those L$ would be coming into the market on a regular basis.

There would also need to be other dynamic L$ sinks applied to the system. What form those may take are wide, varying from a simple tax on all sales, to a charge for functions (some concepts good, some not so good).

The basic line is that LL needs to take a pro-active stance toward the economy rather than letting it run wild and handing out L$ like they were candy-- which is what they've been doing up until now.

Regardless of what people claim to the contrary, when the economy on SL starts going haywire the responsiblility comes down to those who control the L$ flow-- and that is Linden Lab. When the mailman is bit, you don't blame the dog.

As a basic account holder i couldnt care less if i get $50L a week. The amount is so small its next to useless to me. But what is being said in these thread is nothing short of Classism. You have your upper class wanting to take away from the lower class to swell thier own wallets. Not everybody is in a position to actually put REAL LIFE MONEY into the game and as such shouldnt be persicuted for it.

Let me ask this question. Where do you think all those $50L are going when a basic player gets it. Do you think they are saving it hopeing to one day earn $20000L so they can get $18USD. Of course not, they are spending it putting it back into the economy which then eventually finds its way into Merchants linden accounts increasing thier bank balance to allow them to go out and sell it on the exchange.

My personal opinion is get rid of Dwell for land owners who SELL GOODS and SERVICES and increase the basic account stipend. Then business owners will have to earn thier money the hard way by actually selling the goods that they make instead of plonking a few camping chairs on thier land to increase thier DWELL payments. Land owner who OWN land purely for NON PROFIT use perhaps should still be paid DWELL for providing a popular attraction to SL.

End result is Less Money into the Economy but allowing more money for basic account holders to spend in your SHOPS. In another words if you want to run a business in SecondLife then earn your money and stop recieving free money from linden labs simply because you have a high traffic ratio.

Its my opinion that the Linden is losing value simply because basic account holders are being given free money, not by Linden Labs but by YOU, the premium account holders, your placing camping chairs everywhere to entice people to where ever it is you are to increase your DWELL payments. You are the ones ruining the economy. Basic account holders dont have to become premium account holders because YOU are giving them free money. The answer is stop using Camping chairs, but your not going to do that because then you get less money from LL for DWELL. OK so lets just CUT DWELL completly out of the equation. NO DWELL NO CAMPING CHAIRS NO FREE MONEY FOR BASIC ACCOUNT HOLDERS. Offset that by actually increasing there $50L to a resonable amount to allow the game to be fun for basic account holders and business owners will work harder to attract business selling goods that people actually want and when it comes to selling on the exchange dont sell for the cheapest price you can get and help drive the value back up, ditto for buying.

Oh and by the way, dont tell me premium account holders dont use CAMPING CHAIRS either.

I really like Robertt Goodliffe's suggestions in the previous post.


I'm curious...What about -rezzing- the L$ required to pay the stipend out of a given percentage of actual game generated $US revenue from land use fees, premium membership fees, new or increased fees or taxes? That way the stipend would be created from actual SL economic activity.

Why is the stipend not part of the economic structure itself?

How about no more magic money?

around 500L$ for 2$... (10 week of basic stipend)
TWO DOLLARS !

So...
- they can buy a computer, a screen, a desk, a chair, etc ...
- the computer is powerfullenough to run SecondLife. I mean... second life is very intensive on ALL computer ressource (RAM, HDD, GFX CARD, ...). It's not a textbased tetris-like.
- they have high-speed internet connection. (SL is impossible with 56k, i tried)
- a 3D Graphic card
- enough RAM
- etc

But you say some ppl CAN'T spend 2US$ in SecondLife ?
I can understand (very easily) they DON'T WANT to spend 2US$ in SecondLife.

Honnestly, If you can buy a computer good enough to run SecondLife, pay the fee for a high-speed internet, you CAN spend 2L$ a month, or week, or whatever.

2US$ ... it's the price of a crap beer...

EDIT: again, i'm against basic stipend removal.

Umm, the money for the computer is gone once it's paid for. So is the money for the internet. Maybe they don't have the extra left over to pay.

Also, maybe they think that buying L$ is bad value, which often it is. SL stuff tends to require a regular income rather than a one-off injection.

i agree.
But i don't want to hear stuff like "I have all the required hardware to run secondlife, i pay a high-speed internet, but i'm too poor to spend 2US$. Please understand, i'm so poor i eat my dog's food".

Keep the basic stipends and remove the ability of free acounts to sell $L on LindeX

Oh, great.

I'm not a premium member because the main attraction of it for me is land ownership; I room with a friend, so I don't really want that. Maybe eventually, but not now...

I make textures. In your scenario, the money I make from that would wind up being /useless/ outside SL. I keep my money inside SL for now - but if I leave SL for some reason, I want to take my money with me.

No, thank you. I think killing Dwell premiums is the way to go.

That doesn't solve a thing. If the basic user exchanges it for USD, buys merchandise from another user, or saves it to spend later, it nets the same result.

AAAAAAAAH! CAPITAL LETTERS!!!! AAAAIIIIIIEEEEE!!!!

SAVE ME JEBUS!

I agree with a lot of the points you've made MM. I always chuckle at some of the responses I get every time I even hint at the concept of LindeX dropping the silly "stock market" arrangement and just act as a straight L$ exchange system with set prices and fees. You can almost see people popping veins. Yet it never seems to occur to them that the idea of doing business on a system that regularly reduces the value of one's sales by up to 20% is not a good idea in a businesman's mind. Well, the human race has never been credited with all that much common sense. LOL

I chuckle at similar vein-popping every time someone mentions the logical concept of not giving people free money for playing a game (thereby devaluating the L$ on a weekly basis). Not only does it add L$ to an already glutted system, but it also discourages people from purchasing L$ themselves-- after all, they're given US$2 absolutely free every month... which is what, $24 a year Linden Lab is giving to every non-paying user? ACTIVE WORLDS clients PAY that amount every 4 months for the privilege of using the system. One cannot help but wonder.

Like you, I have recently become aware of the paradox of "120,000+" members... with no more than 4,000 online at any time. A little over a year ago when I first joined, the population was about 25,000... with around 2,500 logging on at any one time. Now we have 4,000 logging on? You'd think it would occur to someone that Second Life isn't proving to be all that popular to new members... or more of them would be sticking around. The ratio of active users by population has dropped from 10% to 3%. If I were a company owner, that figure alone would tell me that SL is doing something wrong somewhere.

I enjoy Second Life, obviously. It is an amazing system technically. The basic idea is peachy (in some ways. In some ways not. It all too often seems more like a porn market than a community). There's a lot about it I don't enjoy... the lack of economic control and stabilization of the L$, bugs that have existed forever, breaking of things that once worked (texture and sound handling for example), failure to kick griefers in the tail on a consistent basis and favoring of griefers over valid users... all of these things cost LL customers on a daily basis. It's not like these things haven't been pointed out by users over and over either.

But as you stated, these things can be pointed out, discussed, and debated without reflecting on the education/ intelligence / parentage of the opposition.

There are basically four scarce resources in SL. a) Ideas; b) Work, c) Popularity/participation; and d) US$. (Land isn't scarce because you can always get it if you have enough US$)

If any of these are lacking, SL will not work. If there are no ideas, nothing can develop because no-one knows what to make. If there is no work, nothing can develop because no-one can be bothered. If there is no participation, nothing can develop because there is no reason to develop if there is no-one else to buy or see it. If there is no US$, nothing can develop because LL goes bust.

The L$ is a mechanism for exchange between these four resources. The L$50 stipend is the payment for the amount of "popularity/participation" the person has injected into the economy by being there that week. That's why basic accounts have to log in in order to get it.

Yea, and wouldn't it be nice if forumsters really would practice this?

Imagine a forum where people would be discussing and debating other residents opinions without questioning their IQ, lack of "common sense" or good will, without calling others ideas "silly" or wondering, why "they don't agree me, even though I speak slowly and repeat it often?"

OMG would this be a beautiful forum, where people would realize that "common sense" is usually just another word for "my opinion" ...

Common sense has nothing to do with personal opinion; in fact, it's just the opposite. Common sense is the ability to realize an obvious reality and act accordingly. It has to do with dropping rationalization and philosophy and recognizing a simple fact when one sees it. It also has to do with using wisdom and discernment in pursuing a course rather than plunging headlong into obvious problems.

And yes, our society in general lacks "common sense". No one can engage in activities that are obviously dangerous and self-destructive and claim to have that trait. People know about herpes and AIDS and all the other widespread diseases, yet still insist that sex beteen "consenting adults" is OK (suicidal course is not common sense). We are told that the "greenhouse effect" is starting some 3 decades earlier than predicted, yet we are not pressuring the government to change automobile fuel standards. We're polluting the planet we live on and poisoning our foods-- and as a result cancer and other diseases are at an all-time high.

So, back to the initial comment: no one ever accused the human race of having common sense.

I've got a Basic account, but I don't need my stipend... I pay $33 a month rent and at least $40 a month to LindeX. L$50 isn't going to make much difference to my L$10000 a month.

I want the reputation bonus back in some form NOT so <i>I</i> can make more on my stipend, but so that the people on camping chairs get an incentive to hang around interacting instead of sitting on a prim and helping rip off people building REAL attractions.