Apparently, Linden Labs (the controllers of SecondLife) are cancelling "dwell payments" in an attempt to get their economic feet under them again. You can read a bit more here.
Ah, so it's dwell payments causing the downward spiral. Of course! It's not like dwell payments have been around since the beginning of the freaking game or anything.
Oh, wait, it's just like that.
Ever think that the reason your economy is both crashing and booming at the same time is because you have devalued your money? Yeah, they're spending more. Yeah, they're buying it for less. It's not just because you've got a lot of extra cash flowing into your economy. An economy is more than just supply side!
It's because you've shown that your money and your game can't be trusted. Scriptors are irritated. Griefers are growing more potent every day. Land owners - they can and have spoken for themselves. Of course, you've ignored them. Don't want to piss off "the little folk", so instead you piss off (and, in fact, repeatedly stab) one of the foundations of your economy.
This isn't even to mention the way that you crush outside implementations - a rather bizarre and ironic twist for a game supposedly about user-generated content. You killed the stable and trusted third part RMT vendor, preferring to replace them with your own yellow version. As unbiased and trustworthy as a politician. You kill any attempt to change policy from the inside, as well.
Your money has been devalued not because there is too much, but because the people who matter don't fucking trust it.