July 1, 2007 by Nobody Fugazi
Posted in
I was checking out Arbitrage Wise's blog, and came across his post Comment on Exchange Blog where he mirrored his comment over on the Terranova entry, What in the World is a Fictional Securities Exchange?.
Truth be told, I'd invested in both WSE and AVIX, but my trust has been shaken on more than one occasion by the powers that be within either institution. Those are personal opinions which guide my investment - but when I read the very start of Maelstrom Baphomet's comment, I think it is fair to share my concern:
At AVIX, it is a game within a game world...
What makes it a game? There is real money being invested, and I worry when people who claim to be responsible - so much so they give themselves titles of 'CEO' and 'COO' - use the word 'game' in the context of anything that they write related to people's money. This, of course, goes back to the best line of Arbitrage's comment:
...I would like to end this comment with one suggestion to the exchanges: Your customers are the investors, not the companies.
Maybe the problem I have with the exchanges, both WSE and AVIX, is that they both seem to think they have players instead of customers. But then, the quote that did worry me came from a CEO and COO of... as he calls it... a game. Did someone go to jail when Montana's Poker Room folded? No? Maybe it is a game. Just collect your 200L when you pass go. Don't land on Boardwalk.
To further exacerbate the situation - Linden Lab doesn't seem to acknowledge the user finance arena other than banning people who buy Linden dollars on eBay and hitting people for 150% when they get paid by someone who obtained money fraudulently.
Invest wisely, folks, but watch out for people who want you to invest in games.
- Nobody Fugazi's blog
- Add new comment
- 821 reads
Still in business, you can find out the answers to your question
http://dragonsbite.blogspot.com
http://www.freewebs.com/maelstrom79
I run one of the most open and transparent companies in the game. And yet, it's still a game, and I still take it very seriously.
Why the exchange folks will call it a game, consistently
The real life US Securities and Exchange Commission doesn't generally approve of people trading in unregulated securities. There are strict definitions of exempt securities for example (often called "microcaps") which can't apply IMO to SL companies because most companies have no corporate status in a US court.
There are a few viable models that *could* be applied to make the in-world markets conceivably compliant, and the SLEC is looking into them, I expect. NONE of the models I've seen could be applied to the level of transparency and accountability required in today's SL stock markets.
As a result, it would be very Wise for Arbitrage or anyone else to refer to the securities they trade as a game. If you find someone who doesn't refer to the in-world markets as a game -- perhaps you shouldn't trust that they understand the laws that (as we saw with the casinos) may cross the virtual border between RL and SL at any time.
Shava Nerad
SL: Shava Suntzu
http://slbizreview.com
Humbug
If it walks like a duck...
What you are saying is that they are trying to avoid the US Securities and Exchange Commission involved. If they were acting in a more trustworthy way, maybe your comments would have more apparent merit. As it is, it seems that this is just a way to fleece the sheep, especially considering this IPO.
There is a reason for regulation - and they are taking great pains to demonstrate why there is regulation, Shava.
And no, I haven't forgotten our brief exchange on the WSE floor where you questioned my motives and didn't believe I had shares in any companies in WSE.
Gamers gaming the exchange
Since Maelstrom sees the SL stock exchange as a game, we have to take his perspective into account and understand that he -- from his perspective -- is *playing* with us. He might be playing any particular role we may or may not be aware of. Is Maelstrom Baphomet a sound businessman? Or instead is he a corrupt CEO? It's possible he's a balanced and (relatively) honest avatar, crossing boundaries only to the smallest of extents, and only when absolutely necessary to protect his investments. Then again, he could be out to make as much money as possible, forging relationships only to the extent that they will benefit his interests, not hesitating to destroy those who dare to make any of their own money in-world.
We may never know what his game is, and the wisest action would seem to be to not invest any real money/time into his stock or the AVIX exchange. We should wait until there are more "serious" contenders in this space -- those who don't view the exchange of L$s as nothing more than "play money". This may never develop, of course, and it may be best to hold on to your money, spending only on "tangible items" or anything of "real" value.
Personally, I have to admit I share, to some extent, Maelstrom's view of the exchange -- it *is* a game -- we're all players, and can play any part we wish. I can play the part of the fiscal investor; on the other hand, I could just as easily opt to play the fickle investigator. Perhaps both. But do you think I would reveal my avatar's true purposd? Part of the game is having you figure out who/what I am. Perhaps I'm trying to figure it out myself.
Then again, perhaps I'm not so complex. Perhaps I'm just a regular ol' homeless avatar, drifting with the wind...
When it comes down to it, one should only put into it what one sees as worth the value they're getting in return. For example, I've put enough time into this comment; I don't see the value in taking any more time to compose any more of it. It's time for some RL moneymaking.
The Virtual Markets
A pity they always quote me in the context and never gave my view on how important it is to keep the game fair and to attempt to provide a measure of protection from fraud. Even if it is a game, doesn't mean you should let crooks run away with it.
Assuming You Are Maelstrom...
You are quoted in context, with a link and everything. Calling it a 'game' is a trivialization. People who invest money may not think it so trivial.
I know that I don't.
Good point.
But, on the flip side, the amount of money makes a difference. The stock exchanges are not playing below.. let's say... small claims court.
It's real money, even if Maelstrom tells you it isn't
It seems that Maelstrom Baphomet wants us all to believe that it's all just a simple game, that it's not real, and to take it easy. Yet he's playing with our money -- our *real* money -- and that's not a game, friends.
Anyway, I think I agree with your comments, if I understand your meaning. Please clarify, if you don't mind -- either that or we can move on to the next topic, I suppose.
I agree with you.
When I put a few hundred bucks into something, or even less than $100, I sort of expect people to be serious.
Tis Maelstrom
I am quite serious with it, but it's still a game within a game. The rest of my comment if quoted would have stated that I still take every investment very seriously. The game becomes no fun if people cheat. We have a motivation to keep the exchanges fair and to do our best to turn a profit for our virtual investors. If you're putting you real money into it, it's the risk that YOU assume as with any investment that you would make. Fact is though a lot of avatars get a stipend of 50 a week they can use on whatever they like and they don't even pay to play SL.
That said, yes this is a game to me. Yes, I take the game seriously. No, I'm not out to harm anyone, but protect as best I can the interests of myself and my sl virtual gameworld investors. I have been an advocate for investors since I began trading, as a CEO, and even when I became associated with the exchanges, I intend to continue down that venue. I've even offered investor education classes where I warn about the very same risks everyone's talking about here and the rule I think is tantamount to SL. Do your research, invest with only who you trust. A good CEO can betray his investors within a heart's beat in this environment and though some exchanges and people are working on measures to make that course of action more and more undesirable to any potential betrayers of fiduciary duty, it is still very much like wall street before the wall and 1929. People still managed to be successful in that environment.
The game becomes no fun if people cheat.
Well, people are cheating. Are you quitting because it isn't fun anymore?
Honestly, you wouldn't be 'playing' unless there was real money involved. And we don't know how many alts there are, anyway...
So let's break this down - either people are playing a broken game or it is legal money being taken. People who hide behind the 'game' and 'fictional currency' phrases demonstrate that they think that they are smarter than the system - but this is a new system and rapidly evolving due to the demands of users on the system. And in the greater 'game', there is a definite lean toward people's money being very real to them.
You speak of 'Before the Wall', but we are after the wall in that regard. There is a turning point here, and at such turning points history (which you have pointed to) demonstrates that when there is change, people's assumptions are challenged... and people who don't change get hurt.
To use your words, we're not 'Before the Wall' (which was Dutch, by the way, and predated the street - before the Dutch took Suriname in trade...) - we're on the 'Wall'. You can walk on the wall as long as you want, but one way or the other you'll have to come down. Try to be graceful.