RLX of the WSE is dead.

Another company on WSE, which continues to trade, has collapsed within 4 months of opening. RLX no longer holds any land, It's CEO has been absent for a long period with the last posting date before the most recent December announcement being the only since October. It has no means of income. Company communications are practically non-existent. Most employees have moved on. If you have investments in this stock; selling now will save your shares from being WTF'd to 1/4 value possibly even less.

I come to this conclusion after talking to former employees, researching the CEO's landmarks to the land holdings for RLX in world and researching the financial details of the company which have not been updated since October. It is possible the company may be reorganized, but I've not seen this occur often on the WSE.

Additionally, another symptom of decay is the state of the maintenance of the company's main web page. It does not appear to have been updated or posted upon since August, which is the very month the company listed.

Interestingly enough, the WTF fund of the WSE actually owns 20% of this corporation. I am relaying this information to WSE administrators and requesting an investigation.

DGD expands operations

It's been a while since I've tried a land venture in the SL markets because land has been rough, but I found a pretty hopping club next to some cheap land today, called Club Wolf.

The experiment is inexpensive, 1366 to buy the land to get started, 2611/month to maintain if all goes well.

If you're interested in seeing DGD's new startup location, just drop by Mark Edge.

The shop's already set up and ready to rent!

Happy Holidays Everyone! Merry Chrstimas, Happy New Year!

There's not much to say about the market this part of the year as it tends to get slow and sluggish as not to many people bother with their investments or tracking the market around the holidays.. at least, I don't. However, there's a lot to be said about the WSE which continues to generate controversy about the numbers that it posts concerning its own data and competitive stature.

As Aldon Hyne has so clearly pointed out, there's little chance that WSE now contains over 90% of the market volume. There's just too much trading on the other exchanges. I am concerned that the Dreamland Stock Exchange(DSE) may no longer be a valid investing exchange for Second Life. If they cannot get their PED to Linden transfer tool working once again, then there would be no way to buy some of the companies listed on their exchange or to convert PED investments into credit that would be usable in the Second Life world. Contacts with Support ACS of Anshe Chung Studios and the Dreamland Estate have resulted in consistent apologies for the lack of functionality and a promise for a return to normalcy as soon as can be provided. I have no choice but to wait patiently to see if the matter resolves, but hopefully they've learned from this and it's one more vulnerability they need not worry about being subject to in the future. I hope they're being honest with me, because I don't think Anshe could afford verifiable bad press concerning in game business ethics but would reap bounty from verifiable good will and solid business practices. The Support ACS personnel were even kind enough to offer to contact me soon as they know the converter was functional once more.

Intlibber's BNTF also continues to have me concerned. Their atms are consistently off and their web page is now employee access only. It's a very disappointing situation as I thought they would be able to maintain a far more stable interface for their clients given the size of their other operations. I mean, if we cannot trust BNTF, how do we trust ACE? They're owned and operated by the same person. I'm willing to be patient, but the question is, how patient must a depositor be for reliable account access. This is not the first time the bank and exchange combination above has had "interface problems." Sorry I'm so critical, Intlibber, my old friend; but I have to keep to the observance of the truth of the matter and truth is that this pattern is very worrisome to anyone who has funds in your institutions. Feel free to say something in comments about whatever progress or plans you have to remedy the situation to your defense if you like. Their web page is still down as of the posting of this blog, I will be checking their atms again later today. At this point, I have no intention of withdrawing from either institution; I am simply on edge.

I am hoping the holidays will start an influx of funds into the markets of Second Life and that part of those funds may see their way to the exchanges. The economy of Second Life is, after all, simply a derivative of the extra spending money of all the people who use it around the globe. Most users are probably from North America and the U.S. So it leaves hope for a slight boom of profitability.

Congratulations to CAPEX on exceeding the other exchanges in Market Volume dominance according to independently observed measures. Let us hope all exchanges continue to see growth, strength, and a continuing push towards good will towards investors.

Note to self, Login before you blog:

[12:14] Nancy ACS: (Saved Fri Dec 14 21:31:45 2007) Hello:)
[12:14] Nancy ACS: (Saved Fri Dec 14 21:54:26 2007) You can transfer PED into L$ in our website now
[12:14] Nancy ACS: (Saved Fri Dec 14 21:54:27 2007) :-)

DSE on the ball. Go Anshe? I feel so wierd saying that.

Of management, exchanges, and risk.

I've been quietly pondering something the past few days. The risk of exchanges are directly tied to risk of management. Many exchanges have leaders who have a strong ideological sentiment. Sometimes these sentiments disagree and verbal barbs are traded. The problem is that over-asserting moral authority can be as devastating as letting crooks go. There's a right and a wrong way to do everything..

Do exchange heads have a right to assert their ideology? Doing so can potentially put their own exchange and assets at risk if third parties, that mainly being Linden Lab disagrees with the intent of the message and thus exposes their investors to additional potential risk.

A lot of recent argument has risen over the products SL Capex's real life company produces and the legal risks involved in that product. Some assert the Sports Arbitrage product is legal, others illegal. Though the product clearly does not list itself as a gambling instrument, its links to gambling can easily be seen. If it's not a matter decided in the courts because it has no legal grounds, does it become a moral issue? Do exchanges have a right to claim moral authority?

To me, the exchanges have been and always will be an instrument. The only real measure of "morality" is whether or not they operate a system of fair and equitable trading. To me, anything outside is external to the game; the content of real courts and greater powers. Besides, games of chance can be moral if not abused and simply a form of entertainment in some jurisdictions. The problem is the moral fabric of society is so weak that in most cases it must be illegal or severe consequences result because addictions are not overcome. Linden Labs has dictated that inside their world all gambling is illegal, but the applications in question have nothing to do with second life and in fact are sold for "information purposes" only according to the terms of service.

Do the heads of exchanges have the right to take such moral risks with their operations given they have such a great power and sway over the operation of the platform on which so many investor's investments ride?

To me the answer to all the above questions, are no.. not really. But I don't have much of a choice in the matter. Exchange heads will continue to attempt to assert "moral authority" due to competition. Exchange heads will likely to continue to sell their products despite what I may say perhaps.. or perhaps not.. to legal regret and potentially market wide regret. Personally, I don't see much coming of this discussion that will benefit market investors at all on any exchange. All I see is greater risks, even as more information is uncovered and more rhetoric is thrown about.

SL CAPEX stealing the show.

It's officially up over 20% from the past 30 days and no one else is even close to the incline. The real question, is this a long term gain? Are we seeing a capitol migration from other less savory markets or is this just a statistical burp? Time will tell. Without some solid foundations I can't begin to predict the future, but consistent dividends on many CAPEX issues may be what's the driving force in this market.

The Great Stage (the media). The War of Words. Don't be Duped.

This entire post is basically in response to this article and the basic fact that ACE and SLCAPEX are once again involved in a war for the hearts and minds of the public.

Unless you're on the inside and know something the rest of us do not, this is an examination of what you need to know about the exchanges. Lets review the facts.

1. Both exchange operators have support line access to Linden authorities. If they suspected anything that could be proven either exchange could/would have been shut down by now.

2. It's very rare for any accusations thrown at any particular exchange to have any evidence, besides a hacked up blog or sl log, to throw against the other.

3. The exchanges are enhancements to the game Second Life, they are market simulations that operate based upon businesses operating within the virtual environment and operated by third parties of which few know anything about (unless investigated) and could fail at any day.. including second life itself.

I have consistently operated under these assumptions with my fund. You should to if you want to know what's safe for your virtual wallet.

The solution to a market where risk is maximized and returns are potentially robust but also spread thin, is obviously diversification. I encourage you to ignore the press unless there's a bit more to it than snippets of blogs unless you have someone's trust. Ignore the reckless claims of giants with only the attractiveness of their trading platform's interest at stake. Investigate the companies you invest in, make sure they're real and not just digits on a board. Be wary of the ones making frivolous claims, it's often a sign of desperation and may in fact be the clearest way to decipher the risk of any individual institution.

That said, Market Dragon signing off, happy holidays all.

11/30/07 Market Report

Slow Growth amid bank carnage.

The second life equity markets seem to be stronger, even after the banking disasters. This could be because the bank that did actually fail was not directly related to the equity section of the SL Financial Community. The bank that was saved, Lindsay and Luke Bank, could have easily tanked the entire market if Linden Lab had not stepped in. I think that's the big story for this month also, Linden Lab actually moved to protect a failing institution. It makes all bank stocks a measure of a degree safer so long as you're sure their CEO is on the ball because it shows they can get help with enough persistence, diligence, and probably if they can show Linden Lab their paperwork.

That said, before depositing or investing with any bank, make sure you test their atms thoroughly to make sure they're not exposing your money. Something as simple as the withdrawing of a negative sum could tell you worlds about your levels of risk at the institution in question.

This month most exchanges have been moving relatively sluggishly. The 30 day chart on the WSE looks like the pulse of a dead man with only a slightly positive jog of 5%* which may only be temporary in realization and just by chance.. up while I'm writing this report. CAPEX has been showing some strength, it appears to be on an upward jog and has inclined by 10%* for this past 30 day period. The International Stock Exchange is in pain, losing over 18%* for the past 30 days. It makes me wonder what's going on over there that has investors in such a lackluster mood. My assumption is there was that the prices appeared briefly inflated on the ISE which is usually symptomatic of a large manipulating investor behind the scenes. That said, prices may have normalized and it may be time to evaluate for potential purchases. ACE is starting to pick up steam, offering 3 new ipos in addition to its current listing. The same concerns apply to this as with VSTEX's rapid expansion. VSTEX's index has been rising also, so most markets are flat or higher. I'd say that constitutes a pretty reasonable month. I hope they're dotting their I's and crossing their T's in security. The Dreamland Stock Exchange has also been its usual sluggish self with low volumes and mild price changes.

* % in market value changes are courtesy of http://www.slquotes.com

Launderers gone riot.

Something interesting about Dreamland Exchange, its currency converter from Entropian PED to SL Linden has been temporarily and perhaps permanently shut down due to an exploitation by money launderers. Any investment that is in PED sums is currently at risk of not being extractable within Second Life. I've been assured they're working on a resolution of this issue with the Lab and Entropian authorities. That said, it could also explain some of the lackluster behavior of the exchange in recent days. Until the shut down, I was pondering actually looking at the banks within Entropia as investment venues to help drive more revenues.

Reserved optimism.

So am I bear or bull on this coming month? Well, there's a lot of new strengths showing in the markets including a market element which has behaved in an unexpected and positive manner. I guess you could say I'm leaning towards the bull side of the fence a little but my constant conservatism inhibits me from taking aggressive action until I can see real strength. I am looking at the new IPOs on all the exchanges carefully and adding a small sum of each to my portfolio so that they can be traded and profited from.

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