I have heard LL announce several times that arbitrage is bad for the SL economy as a whole. This would include land arbitrage which LL has now made impossible for new land buyers by upping the price of islands and tier fees. This is fine, and I understand.
Here is where my question comes in. If arbitrage is something which LL wants to avoid, why is LL itself taking part in pure market currency arbitrage on the LindeX? Essentially, you are taking L$ in via "sinks" in world, printing more L$ out of thin air and then turning around and reselling those L$ on the LindeX for profit, while at the same time saying that you will NOT buy L$ if the market were to lose value. This, by definition, is arbitrage. No risk, pure return, by taking advantage of a market situation.
In the real world, a government takes in taxes and then uses those taxes to support public policy and projects which creates jobs in the process. Here, you are "taxing" the SL citizen via sinks, but not spending that money in world. Instead you are taking money out of world, to simply resell it back into the economy via the LindeX, while "printing" more out of thin air to also sell on the LindeX. Then you keep cutting stipends, for the "benefit of stabilizing the economy" just to sell more and more L$ on the LindeX, to make LL even more real world profits with no plan in place to help stabilize the L$ if there is a loss in value, which is a currency's main concern.
At first LL said it would NOT sell L$ on the LindeX, which was nice as the market functioned like a real world market should. Then LL stated it would start to sell L$ "for the good of SL" after cutting stipends, etc, which everyone supported because they thought you were trying to stop the devaluation (cutting stpends I mean). LL said it would NOT sell more L$ than what the normal trader tier, which all normal players also had, would allow. Then all of a sudden you opened registration to anyone and opened free alts, which drove up the demand for L$, after which all of a sudden you had to sell more and more L$ on the LindeX for "our own good." Now we see you just added a "supply Linden Trader Tier" which allows LL to sell up to 40 something million L$ per day on the LindeX.
Also, by making the market so unpredictable (LL can dump tens of millions on the market anytime they want) you are making the market less efficient. I see you have some currency traders. By making it difficult for them to measure what the currency may do, you make it less likely for people to "play" the market. When you have less people "playing" the market, your spreads grow as you have less people with open limit buy orders. If the market functioned as a free market should, traders would feel safer buying and selling which would make the spread smaller to not at all, even during times of economic downturn, as you could follow the econ stats to try and turn profit. By making this more difficult, you get less people partaking in buy and sell orders, thus creating a larger spread, which helps no one. That and you get less buy orders, so if someone sells a large order via market, it cuts right through the by orders and they end up getting a bad rate. At least telling everyone a "target" price would help this a bit, but I'm sure you won’t as that would once again hurt the arbitrage you now have in place for LL.
My question is this: Why is arbitrage a bad thing for the SL economy when "players" do it via land, etc., but fine for LL itself to do it via currency? Seems like a doublespeak fallacy to me.
Thanks!
P.S. It should also be noted that arbitrage can actually be a good thing as it helps an inefficient market find equilibrium, but in this case, LL has no competition as you own and control the market. So, in this case, there is no advantage to anyone, including the market. The only one who benefits is LL itself, while others lose out.
I also don't like how everytime LL changes their own tier limits on selling on the LindeX, there is no word of it in the blogs, on the boards or anything. It seems to be just snuck in there with no word.
Just some thoughts and insight into what everyone is saying inworld and on third party boards. I still love you and all! I just think the whole currency arbitrage thing is a bit out of whack and will only hurt SL in the long run. It simply is not natural! Love ya!
PPS. Please don't take this as if I am mad at you or something. I've had a good time in your world and really could care less if you arbitrage your own world forever, heh. I'm just stating things that I have heard many times from other players, and just wanted to make sure you were aware of what people are saying and thinking, and wanted to ask about if you thought what you are doing is against your own "rules of thumb." Good luck fixing all the bugs and stuff! I'm sure we'll get through this. I know this whole world is novel, and will take lots of trial and error. Love ya!