NationStates Jolt Archive

Link to Article (http://www.msnbc.msn.com/id/27846252/)

So apparently, Second Life had a banking crash of it's own before ours, in 2007. Which just prompts the question, why do people play Second Life with it's crappy graphics?

Virtual economies in games such as "Second Life" and "EVE Online" may seem trivial, but they actually can provide real-life lessons on the patterns of free markets and unfettered capitalism.

While that's all fine and dandy, the problem here is that we do not have a true free market and unfettered capitalism.

The end came when panicked investors began withdrawing their virtual money, known as Linden dollars in the game and exchangeable for U.S. dollars at a rate of roughly 250 Linden dollars to one U.S. dollar. Ginko did not have enough reserves to pay up. When the bank finally announced it was finished, an equivalent of $750,000 in real-world U.S. dollars went up in smoke.

Virtual companies not be able to keep their promises? Shocking! I am shocked and in awe!

"If you want to compete with Disneyworld, well here's the land and tools to build a rollercoaster," Bloomfield said while describing the "Second Life" approach. "If you can get people to ride it, go for it."

Who would pay money to ride a virtual roller coaster?

So what do you guys think?

So what do you guys think?

about...what? Runs on banks are nothing new, and nothing unheard of. The circumstances and psychology that could cause a run on a real bank apply equally to any institution where anything of value is stored and loaned out, be it a physical safe, or a virtual money market. Modern banking is largely designed to try and minimize the risk as much as possible.

SL foretold financial crisis

It did no such thing. This bears little resemblance to the current crisis.

It did no such thing. This bears little resemblance to the current crisis.

this, also.

It did no such thing. This bears little resemblance to the current crisis.

Well if their "bank" had a run on it, it does have some similarities with the current crisis. Can anyone say Northern Rock? Though the reasons behind the two are different.

Well if their "bank" had a run on it, it does have some similarities with the current crisis. Can anyone say Northern Rock? Though the reasons behind the two are different.

A single bank run hardly sums up the current financial crisis. The idea that it somehow foretold the crisis is bollocks.

A single bank run hardly sums up the current financial crisis. The idea that it somehow foretold the crisis is bollocks.

Yes and I meant to clarify that in my post that this run on Second life money was not a foretelling of the current crisis. But I forgot about it.

basically i think the whole idea of market economics, i mean it sounds good on paper and in an economics classroom, but in real life, free markets DO NOT equal personal freedom.

not that the absolute tariff controll the government held over railway freight opperations in the u.s. was really any sort of ultimate solution either.

i can understand skepticism. i'm just not into limiting it to one way. i'm equally skeptical of what people expect from market economies.

you know, in the "real" world, people thought they could leverage for ever and caveat emptor and all that, while at the same time keeping buyers, consumers, UNinfomed and making rediculous decisions based on too loose credit.

well i'm not claiming to have all the answers, and i LIKE the idea of a virtual world i can build things in and people can wander arround in each other's fantasies.

i think people too much worship, are too much emotionally attatched to the idea of symbolic value. neither impressing each other, nor excitement, are what make a world worth/gratifying, to live in.

i haven't been back to second life since long before the crash spoken of, for the simple reason, and i was advised of this by one of the lindens when i asked, of not having broadband.

pretty much limits me to galleries and forums. i keep hearing people on here denying the connection between ragunomics/deregulation and economic melt down, denying even the connection between the roaring 20s and the crash of the 1930s.

every time capitolism has worked for anything other then its meaningless symbolic self, it has been coupled with a reasonable degree of social responsibility. throw that out with the bath water and, however much economic theory my seperate itself from the real world where real people live, i think there's a major flaw in doing so. the environment is where the air we breathe comes from, and however counterintuitive or something it might seem to say so, it IS all connected.

people brought with them into second life the same false assumptions they were familiar with in mundane life, and so its no surprise to me, if what supposedly happened did.

i think that's one of the good things about being able to sim stuff online. i don't think you can ever sim 100% accurately, especially if you're trying to taylor it to be something gratifying to play too. but it seems not unreasonable to me that there are things you can to some degree test out that way.

especially the psych factors, how people of diverse perspectives will react to various concepts and efforts. that's one of the things that attracts me here too.

So what do you guys think?

I think that I agree; Second Life has extremely poor graphics, especially considering the hardware necessary to play.

My lecturer predicted it in 2005, and gleefully handed out to all of us the article in which he predicted it. Not because it was useful for the course, but because he wanted to show off

I think that I agree; Second Life has extremely poor graphics, especially considering the hardware necessary to play.

Don't know, it's just not my bag man!

My lecturer predicted it in 2005, and gleefully handed out to all of us the article in which he predicted it. Not because it was useful for the course, but because he wanted to show off

I would have done exactly the same thing.

My lecturer predicted it in 2005, and gleefully handed out to all of us the article in which he predicted it. Not because it was useful for the course, but because he wanted to show off

back in college, I took a class on US foreign policy. Part of the readings for that class was a book on selected essays. One of those essays was written by the professor of the class.

On the first day, he explained that he didn't assign this book, and the essay in particular, for any ego reasons, he just felt that the book, overall, was the best collection of writings on this particular subject, one he, obviously, felt was important, because he wrote about it.

But he assured us that he was not doing so for the royalties, given that they were quite meager and to prove it, proceeded to hand each person who bought the book his share of the royalties from it. One dollar.

It's interesting to me that they would charge real money for linden dollars, tout an economy where you could supposedly make a living on Second Life, and than NOT back the fake currency with the real deposited money.

But it wouldn't matter to me because I find nothing that is compelling enough about the Second Life service to spend my money or my (infinitely more precious) time on there.

P.S. They could have backed it by putting all the deposits into bonds, cash, or a money market, and went to a venture capitalist for money for expansion instead of spending the deposited money.

It's interesting to me that they would charge real money for linden dollars, tout an economy where you could supposedly make a living on Second Life, and than NOT back the fake currency with the real deposited money.

meh, it's not like a bank backs every dollar deposited with them. Far from it.

Figures that SL would have a market crash. It was really only a matter of time seeing how the entire economy of SL is based on the cock. Same problem with the gold standard, eventually you just can't keep producing the thing you're basing you money on at the same price. You either float your currency or switch to something else that will never lose its value. I am of course talking about rape dollars. Rape is an endlessly renewable resource and the National Institute of Justice estimates placed the annual social cost of rape and other sexual assaults of adults at 127 billion dollars, or about $508 per U.S. resident.

Both SL and RL money should be backed from now on by rape.

Ohhh noes.... my retirement!!!!!