Hello guys,
To keep it simple, have you ever observed a google penalty when you interlinked several of your websites? If so, please share the number and your insides.
Word on the net is that:
1. Interlinking more than a dozen websites will make goolge consider them as 1 and rank 1 of your sites very high and the rest on page 1000 -like a yoyo. You do some more seo on another site, that one gets up and the prior money site gets down.
2. Goolge won't care but being evil as he is will devalue the links

Well that is bad but we can live with it.
3. There is no penalty but it's hard not to link to a bad neighbour in adult - busted! big G will penalize you whole network and not just your site.
I have made a seo checklist for my network just to stay on the safe side.
Many of my sites dropped from great positions in serps but I can't pinpoint towards the reason because there were other areas where I may have done wrong
My safeplan was:
- stopped interlinking my sites - had 28 sites interlinked;
- keyword density - under 2% (panda)
- no rss, dupe content (panda)
- no anchor text navigation (words on the net a penalty exists - would be great for a future disc)
- moved some of my links from the footer, spread'ed them all over the page
- tried to diversify my backlinks more - about 60% keyword related the rest url, click here, random
....
and so on;)
So you see, google could slap me for so many reasons

that I can't pin point to the interlinking.
I can hardly wait to hear your oppinions;)