Can't fight City Hall- eBay protecting their large sellers (probstein content)

[1952boyntoncollector]

Originally Posted by Leon

Yes it is.

Leon- If buyers actually had to pay 20% if won their own items, do you agree that its not as big a deal as many think. I understand there may be issues if they acutally have to pay the 20%, but lets assume you lose 20% if you win your own item, don't you think that's enough of a penalty.

thus if I were to bid on an item, I would know that if the bidder under me was prepared to lose 20% if 'won' the item is pretty comforting to me ..

yes I know you will come up with examples if the item is about to sell for 40% lower than perceived market so people bid on their own items..i say go ahead and eat 20% ..you really think they will want to eat another 20% on the same card?

[Leon]

Originally Posted by 1952boyntoncollector

Leon- If buyers actually had to pay 20% if won their own items, do you agree that its not as big a deal as many think. I understand there may be issues if they acutally have to pay the 20%, but lets assume you lose 20% if you win your own item, don't you think that's enough of a penalty.

thus if I were to bid on an item, I would know that if the bidder under me was prepared to lose 20% if 'won' the item is pretty comforting to me ..

yes I know you will come up with examples if the item is about to sell for 40% lower than perceived market so people bid on their own items..i say go ahead and eat 20% ..you really think they will want to eat another 20% on the same card?

By definition shilling is fraudulent. If you want to protect the price on something do a reserve or higher starting price, neither of which is fraudulent.

[1952boyntoncollector]

Originally Posted by Leon

By definition shilling is fraudulent. If you want to protect the price on something do a reserve or higher starting price, neither of which is fraudulent.

I agree with you there...but not sure why they wouldn't rather just set a reserve than risk 20% on a 'win' to me that's saying something if they are so sure their bid is so low that they will pay 20% on a win

if card vcp is at 20k and the bidding is at 18k...and they can lose 2k..you really think they bid it to 19k and have the chance to lose 3800? doesn't make sense..i really think though illegal its a non issue for the high priced cards at AH that make you pay 20% on a win.

[Robextend]

Let me throw in my two cents (which is worth less than 2 cents).

An item is worth what someone is willing to pay for it. When someone bids on their own item, no matter if it is $2 or $20k, it is misleading the market.

The item really isn't worth 19k in your above example...no matter what the outcome is...if the final bidding was meant to have been 18k, that is what it is.

Like stated previously...set a reserve if you are afraid the final price won't be to your liking. It is legal, and does not fraud the market out of valuable data.

[Exhibitman]

The AH hypothetical is not realistic: no consignor who can do math is going to shill an auction already sitting at 90% of past results since it would cost him somewhere on the order of 18% of the value of the lot.

Shilling in an AH would be attractive when the price is way below market and the seller is going to take a giant loss. I'll give you a real world example: Heritage Auctions. HA does two interesting things: it expressly allows consignors to bid into their own lots in return for paying the BP if they win, and it holds unsold lots open for some time as BINs for the minimum bid. I sold a bunch of stuff in November. I did not bid into any of my lots in November. Two of my lots, however, which I was into for ten times the opening bids, were offered as post-auction BINs. I opted to exercise my consignor's rights to BIN them [at the cost of the BP] and avoid taking a 90% loss. The cost to me was effectively 20% of 10% of the cards' value, i.e., 2% of the value of the lots. It was worth 2% to me to take the cards off the market rather than see them sell at throw-away prices and net practically nothing.

This isn't the same as shilling--shilling by definition is illegal and not allowed under the auction rules--so not a perfect analogy, but it is the same financial calculation. To me it was worth 2% to hold my items back. If the cards were at 70% of what I felt was market price I probably would not have gone back into them.

One further note: this whole idea of 'market' is an artifice. We don't have the theoretically perfect flow of information and participation that the model assumes. With all of the auctions around plus eBay the reality is that lots of collectors miss lots of items, which sell for a lot less than they would have otherwise. If information and participation were perfect it would not be possible to flip cards for a profit. I have often had cards go begging on eBay or at auction then suddenly take off and sells in competitive auctions. No rhyme or reason to it, they just got found by the right bidders.

[bnorth]

Originally Posted by Exhibitman

The AH hypothetical is not realistic: no consignor who can do math is going to shill an auction already sitting at 90% of past results since it would cost him somewhere on the order of 18% of the value of the lot.

Shilling in an AH would be attractive when the price is way below market and the seller is going to take a giant loss. I'll give you a real world example: Heritage Auctions. HA does two interesting things: it expressly allows consignors to bid into their own lots in return for paying the BP if they win, and it holds unsold lots open for some time as BINs for the minimum bid. I sold a bunch of stuff in November. I did not bid into any of my lots in November. Two of my lots, however, which I was into for ten times the opening bids, were offered as post-auction BINs. I opted to exercise my consignor's rights to BIN them [at the cost of the BP] and avoid taking a 90% loss. The cost to me was effectively 20% of 10% of the cards' value, i.e., 2% of the value of the lots. It was worth 2% to me to take the cards off the market rather than see them sell at throw-away prices and net practically nothing.

This isn't the same as shilling--shilling by definition is illegal and not allowed under the auction rules--so not a perfect analogy, but it is the same financial calculation. To me it was worth 2% to hold my items back. If the cards were at 70% of what I felt was market price I probably would not have gone back into them.

One further note: this whole idea of 'market' is an artifice. We don't have the theoretically perfect flow of information and participation that the model assumes. With all of the auctions around plus eBay the reality is that lots of collectors miss lots of items, which sell for a lot less than they would have otherwise. If information and participation were perfect it would not be possible to flip cards for a profit. I have often had cards go begging on eBay or at auction then suddenly take off and sells in competitive auctions. No rhyme or reason to it, they just got found by the right bidders.

Good to know Heritage Auctions allows you to shill your own items.

[calvindog]

Originally Posted by Exhibitman

The AH hypothetical is not realistic: no consignor who can do math is going to shill an auction already sitting at 90% of past results since it would cost him somewhere on the order of 18% of the value of the lot.

What about the auction houses who were in cahoots with the consigners and wouldn't charge the juice if the card didn't hit the hidden "reserve" agreed to beforehand?

Don't underestimate how brazen some of the consigners/fraudsters are/were. One guy on Net 54 even told the various auction houses that he wouldn't consign his large collection to them unless they agreed to let him shill his own lots. Naturally, Mastro agreed to that demand and, naturally, even bid on his lots for him.

[Peter_Spaeth]

Originally Posted by calvindog

Don't underestimate how brazen some of the consigners/fraudsters are/were. One guy on Net 54 even told the various auction houses that he wouldn't consign his large collection to them unless they agreed to let him shill his own lots. Naturally, Mastro agreed to that demand and, naturally, even bid on his lots for him.

To paraphrase the great showtune

But where in the world
is there in the world
a man so corrupt and impure?

[1952boyntoncollector]

Originally Posted by Exhibitman

The AH hypothetical is not realistic: no consignor who can do math is going to shill an auction already sitting at 90% of past results since it would cost him somewhere on the order of 18% of the value of the lot.

Shilling in an AH would be attractive when the price is way below market and the seller is going to take a giant loss. I'll give you a real world example: Heritage Auctions. HA does two interesting things: it expressly allows consignors to bid into their own lots in return for paying the BP if they win, and it holds unsold lots open for some time as BINs for the minimum bid. I sold a bunch of stuff in November. I did not bid into any of my lots in November. Two of my lots, however, which I was into for ten times the opening bids, were offered as post-auction BINs. I opted to exercise my consignor's rights to BIN them [at the cost of the BP] and avoid taking a 90% loss. The cost to me was effectively 20% of 10% of the cards' value, i.e., 2% of the value of the lots. It was worth 2% to me to take the cards off the market rather than see them sell at throw-away prices and net practically nothing.

This isn't the same as shilling--shilling by definition is illegal and not allowed under the auction rules--so not a perfect analogy, but it is the same financial calculation. To me it was worth 2% to hold my items back. If the cards were at 70% of what I felt was market price I probably would not have gone back into them.

One further note: this whole idea of 'market' is an artifice. We don't have the theoretically perfect flow of information and participation that the model assumes. With all of the auctions around plus eBay the reality is that lots of collectors miss lots of items, which sell for a lot less than they would have otherwise. If information and participation were perfect it would not be possible to flip cards for a profit. I have often had cards go begging on eBay or at auction then suddenly take off and sells in competitive auctions. No rhyme or reason to it, they just got found by the right bidders.

in your situation you are effectively allowed to do a 'reserve' at a cost....as a bidder im ok with that or even if the shiller has to eat 20% on a 'win'

as to market.....there are certain amounts given a few months we know a 'safe' amount of what we can get for certain cards...a 1952 topps mantle psa 5 any example non qualifier if not fake etc I think anyone would pay 14k for...maybe it can go for more and tons of examples have gone for more, and maybe there was shilling to get to 20k many many times..but cant we agree that shilling wont impact that card being worth 14k? wouldn't everyone on net 54 agree the 'market' would be safe to pay 14k for....the thing with fighting 'schilling' is you cant win.cause the seller can always have a 'friend' that knows the card is worth 14k pay 14k for it..and it magically goes back to the shiller....

I think this shilling is really just a passive aggressive reserve....what a card sells for to me isn't what its worth all the time anyway to the next buyer...if a card sells for 20k then its possible the only buyer wlling to pay that price just bought it,..now that he is selling it..it has a good chance to go for less as he is no longer in the market and he may of been the one bidding it up with potentially just one other bidder to that amount in the first place..

..to me the card is now'worth' something less than 20k...so I don't view past results like everyone else ..I like to see many multiple buyers bidding above a price point etc..