SL Investor's Bank?

I have decided to invest my Lindens into some form of investment, and noticed that the SL Investor's Bank is paying out a very nice weekly interest rate.

I was wondering if anyone has any dealings with this bank, and if so, what are your thoughts?

I'm already aware of the risks involved as far as LL shutting down an account, taking Lindens away, transfer problems etc... I'm just looking for any input on this particular bank.

Thanks In Advance!

I suggest you join Second Citizen and pose the same question there. you will get more candid responses, since the moderation is not so strict there.

I just have two words for you: High Risk.

two more words

Ponzi Scheme

I did a little research and these guys own aLOT of land. Seems they buy land, rent it out /resell it, etc.. rinse repeat, profit, etc...

I don't know what that Ponzi Scheme is though.

http://en.wikipedia.org/wiki/Ponzi_Scheme

It's like a pyramid scheme only less pointy.

I like that

two more words


Loan Sharks






------------------
land is often used for collateral in SL "banking"

In that sort of operation -
Much of the land securs the loans , or taken over when a loan is in default.

my take on this is if it sounds to good to be true it usually it. I think you would be better off taking your hard earned lindens and creating a business. Maybe buy and rent properties yourself. But giving your lindens to some "bank" with the promise of a 0.08 return just seems too risky.

My 2 cents.

they pay off old investors with money from new investors.

i.e. ponzi


sure you will make money with them

but FOR SURE one day they will close, and take every penny with them.
and you have NO recourse. you choose to 'give' them money

Two other words:

Ad Farmers

I've had some pretty good luck on the WSE. It's high risk since there's nothing really keeping a company from just dissappearing with all the share money, but there are several businesses on the market. If you pay attention to the companies and spread your money wide enough then you'll do alright.

Another advantage (or disadvantage depending on how you look at it) is that it's quite a volitile market with some companies' stock going from L$2 a share to L$20 a share and back in the course of a week. Things move pretty quick but their web site has a good function where I can set it to buy or sell a certain amount once it gets to a certain price.

I was fortunate enough to get in on the ground floor on a few stocks when the WSE first started out about 6 months ago. I bought shares in a few companies and left them alone for a while and was able to make L$17,000 off of a L$5000 investment! Now I use some of that money to keep playing the market to see how far I can get.

I love it because I've always wanted to play the RL stock market but I don't have a spare few thousand dollars to throw around!

If you want to invest your L$ in a bank that will safely pay interest and won't rip you off, a bank that is insured and bonded...

Cash out your L$ for real currency and invest it in a REAL BANK.

"Banking" in SL is completely unregulated. You may as well pass your money through a knothole to a stranger who whispers promises he will pay you a good return on your "investment". You have as much recourse in either case if he takes your money and gives nothing back.

Considering that *anyone* can just buy an ATM from SL Exchange, plunk it on their lawn and become a "bank" -- I store my money elsewhere. What amounts to a few pennies in US$ in interest isn't worth the worry over the ATM owner cashing out all the money people have given them and vanishing.

food for thought.

In another online game (EVE), there was an "Investors Bank". In the beginning, they paid interest and did everything to establish their credibility. Then once a very large amount of "deposits" had been made, the creator took the money and ran. Like L$, the money in that game had a RL value too. I've heard various amounts quoted in the theft, but most agreed is was in excess of a hundred thousand RL $.

Now here in SL.... you trust your L$ to someone. Perhaps they even pay you interest the first few months. How certain are you that your money is safe? Sure Linden put in safeguards to catch massive movements of money, but is that system foolproof?

More food for thought. Article regarding Montana's Poker Room (MPR) and the 150% deposit fine imposed by Linden Labs on Second Life Investment Bank (SLIB).

http://www.your2ndplace.com/node/123

If you are going to invest your lindens in unregulated markets like banks and securities then you might also want to try your hand at Texas Holdem in the casinos. There's greater transparency and you have more control over your investment.

The choice is not between SL banks that are all scammers and RL banks that are all regulated and true. I have friends in RL whose banks have gone under due to management fraud, and while they were able to get the minimum amount guaranteed by the FDIC, they lost the bulk of their savings.

The fact is, it is possible to double one's money in a month in SL. It's not only possible, it happens frequently. The issue is capitalization; take the hundreds of millions of dollars a RL bank has to invest into SL, and there's no way you could get a huge return. But buy a select 512 land parcel for L$5,000, sell it for L$7,500, and do it again; doing this twice a month will double your initial investment.

Think about it--how much capital do you really need to design SL clothing or houses? A talented artist with enough time can rake in astronomical profits (5,000%? More?) even if they purchase some land and pay tier for a shop.

I made great profits in land during the up market of December-February; since then I've done some investing in the WSE. Do some research there, and you'll find the names of people you can trust who are turning out solid work. (Incidentally, some of those funds make money depositing into SL banks!)

Can I lose everything? Sure. But I'm not investing my retirement fund in SL, I'm investing the proceeds of my gaming budget from a few years back (profits from which pay my ongoing subscriptions). It's part of the fun for me.

I believe there has already been a Case of one "Banker" suddenly vanishing along with every linden deposited with him for care and investment.

At the risk of repeating myself (Not really a risk, i AM repeating myself):
Only a complete RUBE would Invest in a Bank, or stock in SL when there is absolutely No way to secure such Transactions against fraud, or malfesance on the part of the "Banker".

These schemes always promise something for nothing, Great returns for miniscule investments. The Comedian W.C.Fields put it best when he said:
"You can't Cheat an Honest man."
An Honest man Knows you don't get Something for Nothing.

Angel.

You have all the tools to be your own banker in SL so why give the money to anyone else?

hi Danyael

i havnt heard anything about the bank you mention which i guess is a good thing lol

i use " The Bank " and get 11K interest per month on 100K invested, this is the 2nd month iv'e been with them now, and had no problems, it's owned by a guy called Jasper Tizzy if you want to leanr more about it

That statistic (even if it weren't a proof substitute) pales in comparison to the number of RL bankers that have run off with their depositor's cash.



By this logic, everyone who rents SL land or buys from a SL vending machine or participates in pixel sex is a rube. The renter has absolutely No way to secure their Transaction against fraud or malfeasance on the part of the landowner, the buyer has no way to secure their Transaction against fraud or malfeasance on the part of the vending machine, and the cybersexer has absolutely no way to ensure their partner is the age/gender/species claimed.



Great returns for miniscule investments? If the investments are miniscule, why worry about absolute guarantees?

I'll bet that I could give, say, L$5,000 even to you, and you could turn it into 10,000 within 30 days. If you could do that repeatedly, why not offer to share your ability to make profits with others willing to enhance your capital?

Yes, of course, SL banks are risks. But it seems foolish to tell people it's OK to spend US$10 a month in SL if it gives them pleasure, it's OK to spend US$100 on virtual real estate if it enhances their experience, it's perfectly acceptable to spend
US$50 on virtual clothing, skins, and animations, it's just fine to spend a dozen hours a week logged on to a computer game to chat with friends you've never met--but you're a complete RUBE if you invest in a SL bank!

Hi everyone. Let me also chime in with the World Stock Exchange (wselive.com) as a potential investment. Granted, it's not a perfect system, but neither are the RL markets! There are many listed companies, some have clear business models, some do not. As in RL, you'll do best investing in companies that you understand, with management that you trust.

I run Kush Islands (symbol HOT). Our company has 3 island sims upon which we sell the land upfront (residents can later resell) and collect monthly tier payments. All profit is paid to investors in the form of monthly dividends. We've been at 100% occupancy for a few months now, and that equates to monthly profit of around 150,000L or 0.075L per share. The stock is trading around 3L per share now, so that gives you an annualized dividend yield of 30%. Some stocks might offer a higher yield, but just make sure you understand their business model and trust their execs. The overall market in SL is not fully mature, so above average returns are still possible!

But I do agree with a lot of the posters in this thread: there are Ponzi schemes in SL.

Good luck!

HI there, I am also an investor on the WSE and use to use both ginko and midas banks.
In fact i even own shares in Rockwell's company (HOT) which i am very happy with.

I had over 50000 in the banks but i took it all out once i discovered the WSE as the return i have been getting from trading is far better and they have even started paying interest on any money i have left in my account (making them a bank also).

I have also had a very close experience with losing a fair amount of lindens through my investment in m...s poker room where it is presumed the owner has run off with a fair amount of the companys money and trading has been halted. SO yes there is a lot of risk involved but if you are willing to take that risk then why not? Just dont do it with RL money you can't afford to lose and you will be ok.

SO in conclusion, yes it is a risk to invest your money but any investment has a its risks and the returns you can get through the WSE definetly justify the risk i am willing to take. However, maybe your risk profile is different in which case it is not for you.

I am a gambler myself but here is why I will no longer invest in an SL bank or the WSE, despite having faith in a lot of the business people offering stock there:

No regulation.
No guarantees.
No history.
No recourse.
No safety net.

With regards to SL banks, if you have researched Ponzi schemes, you know there will be a time when investors make money. This does not bother the operator because the investors will most likely reinvest because of natural greedy tendencies as well as letting others know "come on in, the water's fine". But it is only a matter of time before the tents fold up and Ponzi leaves town. As the three card monte dealer said to me as he took my $80 after I had won $40 earlier, "Can't give you sunshine all the time".

Raymond, I would LOVE it if you could share your gambling secret--where you gamble with regulation, guarantees, history, recourse, and a safety net!

I see his point. Just about every place you can gamble has history and regulations. If I gamble in Vegas I can be pretty sure I won't be cheated, just a victim to odds that are against my favor. Not so in SL.