Question/Theory About the Economy

Hey All,

I don't know much about economics assides from the "Eco for Professionals" I took last semester, so hopefully some one can answer a few of my questions.

If we look at the volume sold over the last 2 days we find that it is just around 11 million Linden. This has increased considerably over the last few weeks at a fair pace. Obviously this will occur because people are able to get more linden for their USD and there is most likely an increase from the new population (although how significant I am unsure). Now my question is as follows:

If the volume is increasing to such an extent, should we not reach a point of "equilibrium" at which the vvalue wont increase any more, since buys will equal sells? Also, would it be possible to calculate a rough estimate, assuming population remains the same (i.e. same number of people buying linden) the price at which L$ would have to be, in order for buys to = sells? The population data available could be used (unique log-ons) as well as the economics data (% of population making purchases).

Also - A question more for linden labs:
Are you able to tell us exactly how much Linden exists, including both in-world accounts, and the amount that is floating on the lindex (and perhaps L$ available on the 3rd party sites reference from the economy page)?

Also - what about raising the minimum price of classifieds to the previous days average selling rate (e.g. 320L$). This should have a good sized increase on the sinks.

ALSO - if linden lab is considering selling the linden we pay them (for example, classifieds) on the exchange, what about this:

Rather the charging us USD for tier payments, allow the payment to be made in L$, equivalant to the USD value given the current exchange rate, and then post it for sale on the lindex at L$250 (or what ever your hopeful target value may be). This will remove a huge amount of linden from the economy, and I believe it will drive the linden up in value considerably (please correct me if I'm way off base!!). Granted this would likey cause some $$$ loss in the short tern for LL, I think this would benifit all parties long term.

I think that's all for now, I may add more questions later on. Thanks in advance for the replies!

Cheers,

Kirkmegna Wombat

Hello, fellow Wombat ^^,
the equilibrium is constantly moving up. The problem is we have to many people who sell L$ and not enough buyers. It is like living in a country with 100,000,000 people of which 80,000,000 people have their own business. And I don't see any improvement to this situation as long more people join SL who are here just for the money. I think LL should change their marketing strategy.

That would imply they had one... all they seem to do is promote MONEY MONEY MONEY which is why SL is going to hell in a handcart.

I intend to try and get to the next Town Hall and ask this question.

Lewis

They can accomplish the same thing by just buying lindens off the market to drive the price down. The net effect and the costs are the same.

Or they could stop printing 60 million new lindens each month.

The common thread is that LL needs to stop "borrowing" USD from their currency market in the form of unsustainable money supply increases, if you want to see the value stabilize in the short term.

We are on track for higher sources and lower sinks this month than last month. In other words even with reduced dwell, the situation is getting worse and not better.

Yes they have. Their current strategy is telling people about Anche and how she makes the big buxx.

In order to have a working economy, we also have to look at the demographic aspect. An economy in RL cannot survive, if everyone is sitting in the top management. You need workers, doctors, teachers, butchers, accountants etc. Same applies to SL. The Sl economy consists of too many sellers and not enough buyers.

Now I can see that... you can see that... many others can see that... so why can't LL see that?

Lewis

I would prefer an ad like "Have cheap xxx with cyberescorts here". This would definitely draw the same amount of people in here but those are more likely to buy L$ from the market.