JT Financial's Last Call | Arbitrage Wise's Blog

JT Financial's Last Call

Written by Arbitrage Wise

Wednesday, 09 January 2008

By Arbitrage WIse, CEO
JT Financial

We are now less than 2 hours away from what I believe is the “Moment of Truth”. Once we open up our ATMs at 12pm SLT, we’ll know exactly how much trust our customers have left in us. I do thank those that have expressed their word of support, but with over 10,000 customers, a handful of people showing their support may not be enough to avoid a run. Hopefully, this statement and a detailed list of our long-term objectives may sway enough people to continue doing business with us. Yes, a lot of the following information are things I would rather not disclose, but they would be very difficult to achieve if an inevitable bank run does occur.

First off, to those that are requesting large amounts of withdrawals to pay tier or make land purchases, I would like you to consider this. If JT Financial does collapse, and take with it the entire financial sector, what good will land do? Why would anyone need land? The entertainment value of Second Life is very short-lived. We all can see that with the constant failures of the multitude of real life businesses that have attempted to do business in Second Life. They offered little to no value to the SL Community – in short, they didn’t help us make any money. If the financial sector is gone, the only businesses left are Land and Retail, both of which are very saturated markets. Few people will be able to make any money, and once they are tired of their ‘virtual homes’ and ‘shopping’, they too will leave, and everyone is left with empty land and stores. If you don’t believe me, watch CNBC. The financial sector is in turmoil, consumer spending is slowing down, and everyone is talking about a recession. So yes, you may lose your land because you can’t pay tier, or miss out on a great ‘buy’ opportunity, but odds are, your land business will eventually fail if SL does incur a recession, and your great buying opportunity may end up being just a small rather than a large loss. So why not see this through, and help out the financial community, so that they in turn can provide you with more and better investment opportunities later down the road.

So what are some of these ‘Opportunities’ that I am referring to? A good start would be to list some of the projects that we have under construction, or current own. Let’s face it, the easy days of depositing your money and earning 40-100% or more are gone. But that doesn’t mean the investment opportunities are not there. We have done what I believe is a great job in cleaning up the Stock Exchange sector. From the day we took over AVIX and converted it into Capex, not a single investor has lost money from fraud. IPO’s are clearing faster than they were before, and new funds and investors are coming back. Trust has been brought back to the Stock Markets, and overall, people are making money. Who’s to say that this trend won’t continue and we’ll eventually have a robust stock market with many opportunities for everyone to make money?

One of our major projects this year was to convert SLMarketLive.com from an in-house retail site to an e-commerce platform similar to a Yahoo! or eBay Store that would allow individuals or businesses to sell both virtual and real life versions of items they have. This was going to be the first step in merging real life businesses into Second Life, and showing the Real World how it should really be done. If you were a home-based or small online retailer, this would have been a great opportunity for you to expand your business with a new venue for marketing. You could have virtual versions created for all of your items and sell them in Second Life, while offering a rebate to customers if they decided to purchase the real life versions. We actually sent a long report to Zappos.com proposing this idea, and were able to get a conference call with one of their marketing members. Unfortunately, since they were undergoing internal changes, they were unable to make any immediate decisions, but requested that we keep them informed. You can read the proposal we sent to Zappos.com here

A second project that we also had under way to support SLMarketLive.com was Helpture.com. Helpture.com will be freelancer site catered to the builder and designers. If you run a retail or e-commerce site, odds are, you do not have the ability to create virtual versions of your items. Rather than going the expensive route of hiring a company to create the items for you, you would have been able to post images of your items on Helpture so that individual builders and designers can bid on the project to build the item for you. Both SLMarketLive and Helpture would have created many more opportunities for the Second Life community. Demand for land would go up as more individuals come in to set up their new stores. Builders and Designers would have more work as these individuals get their items built. Stores and Malls would become more robust as new items and new shopping experiences arise, and more jobs would be created as these owners hire sales staffs, or create an affiliate systems so that others can open up an affiliate store selling items for the new owners.

However, none of these things can happen without a financial sector. In order for SLMarketLive to work, there must be a payment gateway for these owners to accept L$ for their real life items, similar to eBayers needing Paypal. In order for Helpture to work, there must be some form of escrow and payment system that individuals can trust. When we released our Wise Property Management IPO, we hinted that we will be rebranding JT Financial to SLWallet.com , which would have served this purpose. Part of the rebranding strategy was to move 100% of the deposits back into SL in May, and discontinue paying interest to become a pure payment gateway for SL. So we were going to be in compliance with LL’s new policy anyways, it’s now just sooner rather than later.

Overall, we’re not failing. We have a successful real life business generating enough profits so that by May, we would have recovered all of the expenditures that we made on these new ventures as well as the interest owed to our customers. And once we proceed with the rebranding of JT Financial, we will be a diversified and debt free business generating profits from multiple ventures, while contributing to the SL community by creating new opportunities and jobs for everyone, and finally doing what all the Real Life businesses couldn’t do, merging RL and SL businesses together. But, none of this can happen without our customers' help. We are not asking anyone to do anything different: just do business as usual, and trust that your money is safe with us. We have already sent a support ticket asking for LL to extend the deadline from Jan. 22 to April 30 and do not plan on getting any bank licenses because that wasn’t part of our long-term plan. If everyone will just go about their normal routine, no one will miss tier payments – no one will miss out on these great buying opportunities. It’s when we let our fear control our decisions that we inevitable make the wrong choices, and hurt ourselves in the long-run.

I have already guaranteed everyone that they will get 100% of their money back, and have offered to sign contracts with anyone – and am willing to pay off-world interests to any investors. I am confident that we'll make it through this problem - it will just take some time. The only thing we can do now is wait and see how our customers react to this. No matter what happens from here on out, we plan to stay committed to paying everyone back.

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SFFan2

| 2008-01-09 14:09:16

We are certainly living in interesting times. I have about L$75000 deposited (between 2 AVs) and do not expect to be trying to withdraw anything today. Only reason I might pull a little money would be to loan/give to friends that had a short-term need. I have no worry about getting all of my funds back.

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Aleixandre Biedermann

| 2008-01-09 15:38:54

Thank you for your explanation Mr Wise. I trust you and my money will remain in your deposits. Good luck with the support ticket

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CheerGirl Allen

| 2008-01-09 16:14:06

So far JTF has done as it has said. I will continue to stay a customer as long as JTF lives up to is Word of "guaranteed everyone that they will get 100% of their money back"

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Ordinal Malaprop

| 2008-01-09 16:55:27

Such comedy value from this! Well, I suppose that comedy will be _the only_ thing that the "SL financial sector" has _ever_ contributed to the Grid.

Particularly amusing is the idea that the financial sector - rather than being a bunch of toy capitalists, teenage economists and con-artists - is actually _central to SL_. Such phrases as "If JT Financial does collapse, and take with it the entire financial sector, what good will land do? Why would anyone need land? The entertainment value of Second Life is very short-lived... If the financial sector is gone, the only businesses left are Land and Retail... Few people will be able to make any money, and once they are tired of their ‘virtual homes’ and ‘shopping’, they too will leave, and everyone is left with empty land and stores."

In other words, all the things people come to SL for and spend money on - we'll only be left with those! And the final line is the best - "If you don’t believe me, watch CNBC." That group of well-known virtual world experts.

The "financial sector" is parasitical on the rest of SL, and provides even fewer useful functions than the financial sector in RL. The proposal that there is a need for an escrow system when there are plenty of the things in existence is ludicrous. I regularly receive payments for freelance work without having to trust anyone at all apart from my bank (whom I have to trust anyway).

And yes, at the end of it, it all boils down of course to "we are great, just trust us, really, no, this time, it will be different, you will get all of your money back, I've guaranteed it personally, it's just a blip, don't let fear control your decisions, we really will pay everyone back honest". Which I'm sure was the whole point of this piece.

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Arnuad Villota

| 2008-01-09 17:06:59

The only reason I would need to withdraw money is to buy a new Formula One Ferrari, but I can wait. :)

Hope everyhting works out!

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SLReports.net User

| 2008-01-09 17:25:52

I will stay with you in SLCapex, or where you stay.
I trust in you. You are an Honor man
From Spain.
Io Habilis member of SLinversion.

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SLReports.net User

| 2008-01-10 21:41:31

This is so comical. I couldn't get through the first
paragraph without spewing my coffee all over my keyboard. You add no value to SL.. There is no such thing as a Bank in SL. You offer nothing. You are a con.

Me

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SLReports.net User

| 2008-01-10 22:19:19

"First off, to those that are requesting large amounts of withdrawals to pay tier or make land purchases, I would like you to consider this. If JT Financial does collapse, and take with it the entire financial sector, what good will land do?"

This is just too much. So you are saying to your clients... Oh no, Oh no... Don't come get your money, just don't pay your tier. It's just land and it's not valuable in SL without a con bank.

You are seriously a wreck of a virtual business person and the fear of what's happening is written all over what you write. My advice to you is to get an education, get some skill, and offer something valuable to the Second Life community.

Me

Well, for one, it weeds out the idiot cons real quick. As mentioned above by another poster, the by night risk manager that works on making sure the risk is leveraged on his behalf. If you have the money, cough it up. Fact is, who should have to wait for what... what did you mention.. MONTHS to pay back those that have money invested in your
scam? Months? Give me a break, I could easily get the money to pay back all of your obligations in a day with "real" banks. So should you.

"Why would anyone need land? The entertainment value of Second Life is very short-lived."

Really? I've been in SL for two years and never found it necessary to put my L in your Avi's account. Short-Lived? Oh... You mean your so called bank. Yes, you are very short lived. Most scammers are. If you cannot pay immediately, you are a scammer. Borrow it from a real bank if you have to if you are interested in saving face.

"We all can see that with the constant failures of the multitude of real life businesses that have attempted to do business in Second Life."

Completely inaccurate statement. Most RL businesses moving out of SL are doing so due to Lindens pure lousy effort at providing a stable platform in which to conduct any real business or marketing campaign. Some, but few, left because their real life product(s) were as poor quality as their virtual goods. That is a fact.

"They offered little to no value to the SL Community – in short, they didn’t help us make any money."

Huh? You are looking for RL business to help make "you" money? You need to go to business school.

"If the financial sector is gone, the only businesses left are Land and Retail, both of which are very saturated markets. Few people will be able to make any money, and once they are tired of their ‘virtual homes’ and ‘shopping’, they too will leave, and everyone is left with empty land and stores."

You are joking right?

Give me a break. You act as though you make SL
spin around on a daily basis with your "Financial Sector" mumbo jumbo. Fact is, grab your credit cards and pay the people back. Get a bank loan. A real one. You are not a "Financial Sector". Not a drop in the bucket to the SL economy.

"If you don’t believe me, watch CNBC. The financial sector is in turmoil, consumer spending is slowing down, and everyone is talking about a recession."

CNBC? That is whom you go to for real life financial information? That is the best you can do? Why don't you just do as Bush does and make your next statement something like, "If our con goes under, there will be terror like never seen before from Osama". LMAO

"So yes, you may lose your land because you can’t pay tier, or miss out on a great ‘buy’ opportunity, but odds are, your land business will eventually fail if SL does incur a recession, and your great buying opportunity may end up being just a small rather than a large loss. So why not see this through, and help out the financial community, so that they in turn can provide you with more and better investment opportunities later down the road."

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SLReports.net User

| 2008-01-10 23:07:25

"So yes, you may lose your land because you can’t pay tier, or miss out on a great ‘buy’ opportunity, but odds are, your land business will eventually fail if SL does incur a recession, and your great buying opportunity may end up being just a small rather than a large loss. So why not see this through, and help out the financial community, so that they in turn can provide you with more and better investment opportunities later down the road."

Making the statement that "Yes", you might lose your land nor be able to pick up a good opportunity do to the lack of your toy fraud company harvesting their L dollars is not very reassuring way to accomplish your intentions.

If you ever do any real business in
SL, you might consider hiring someone to speak for you. The fact is, what you write is a dead giveaway, expresses your ignorance
of business and how it works, and shows lack of concern for all that have L in your avi account.

Just what you wrote here in your article might have proved to be crumbling to your concept of business had you wrote such prior to taking any L from individuals in SL. A mere read of this and one would hesitate to even have you in their friends list.

My recommendation is as stated.

1) Quit conning people. Either get educated and offer something to Second Life or do your conning in Real Life where the law will eventually catch up to you.

2) Quit talking like you understand business and financial matters, marketing, and in fact.. SL.

3) Quit playing business. If you cannot pay it back immediately, you are a fraud. You can either get the money from a real bank and pay people back or close your doors and quit leading people on.

4) Pray you don't get sued in RL.

I do have some praise for you however, I like your site and I do really like your open source content manager. Now for some honest content.

Me

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SLReports.net User

| 2008-01-14 09:28:05

Like most, I've never found any reason to fool with the SL bank and stock exchange offerings in SL so honestly, their passing really means nothing to me personally.

As far as the future business plans, are you aware that you are bit late? The business ideas you are proposing already exist and have been in operation for years. SLExchange, OnRez, and MySLProject already do all of that and do a fine job of it. Instead of just adding another version of what's already been done, and what we already have, why not come up with something that is lacking in SL that would make it better?

Thanks.

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SLReports.net User

| 2008-01-14 23:21:41

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