New World Newsfeed: US Congressional Economist Comments on Linden Banking Policy

What began as a Second Life banking system with a dubiously high rate of return has reached all the way into the hallowed halls of the United States Congress-- or more specifically, the Joint Economic Committee of US Congress.  Or even more precisely, on the personal blog of Dan Miller, Senior Economist with the JEC.  The man who famously opened up the debate on taxing virtual income last year now comments on Ginko's closing, the Lindens' recent move to prohibit unregulated banking in Second Life, and related issues.  Noting that the Lindens have only stipulated that an SL bank be under some kind of real world regulatory body, Miller notes:

Thus, a bank could choose to incorporate in a country that has lax financial standards, such as some African or Asian nations. That is, merely requiring government certification in no [way] guarantees that strong, consumer- and investor-friendly regulations apply.

Read it all here.  While his blog attributes his opinions only to himself, this comes from a man uniquely positioned to influence future US government policy related to SL and virtual worlds in general.

Comments

[HatHead Rickenbacker]

To Congressman Miller's point regarding "lax financial standards", one should consider the sub-prime mortgage crises, the collapse of Enron, Worldrcom etc and add the United States to his list.

[csven]

"Thus, a bank could choose to incorporate in a country that has lax financial standards"

All I can say is, "No, duh."

[Gen Ferraris]

I would prefer "lax regulations" than regulations wich serves and have always served criminals, but ofcourse we cant expect somebody working for the most corrupt government on earth to understand that.

People often refer to fraud as a "Ponzi-scheme", a far more correct definition would be "Keynesian-scheme".

There is no risk in that scheme, it is given, since that economical-fraud theory has been put in practice our curencies have lost 95-99% of their value, regulated fraud is what it is.

I guess mr miller finds nothing wrong with worldbank neither, wich is responsible for millions of deaths due to their ridiculous interrest rates and overrelaxed loans to african countires.

How does he dare to play "holy" and claim who's "lax", he's not in the position to speak about it.
The world would be a much safer place if people such as Mr.Miller would be behind bars.

[Gen Ferraris]

Did i take it too far ? I prefer to tell the naked truth instead of speaking in circles, reading mr.Miller's own blog tells perhaps more about his level of intelligence than the banking ban.

It would be fair enough to just quote the austrialian article about "VR worlds and terrorism", but damn how naive is mr Miller, in his own words about VR worlds and "the boogie man":

"The use of virtual worlds by terrorists should be a concern for everyone eager to see these worlds develop and expand. If counter-terrorist legislation or rules were enacted that crack down on virtual worlds generally, there would obviously be a negative impact on their long term growth.

Ironically, it would seem that the harder governments try to squeeze virtual worlds, the more difficult it could become to track terrorist use of virtual worlds. Terrorist, one might expect, would simply shift to virtual worlds beyond the reach of western nations' laws. For example, worlds like Second Life, World of Warcraft and Entropia are likely to comply with any laws/regulations on this matter. However, rather than prevent terrorists' exploitation of virtual worlds, they might simply move their efforts to virtual worlds that are located offshore in places/countries unwilling to comply with U.S./E.U. laws. This is a problem that merits additional thought."

The journalist that originaly made the claim that VR worlds could be used by terrorists is pathetic enough, but that a politician would not only repeat it but suupport that claim is beyond insane.

Well, on the other hand i had a good laugh.