Subject:
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Re: Honest Capitalism (Was Re: DYA -> eBay 8880 money-making scheme)
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Newsgroups:
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lugnet.general, lugnet.market.theory
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Date:
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Mon, 6 Sep 1999 16:56:01 GMT
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Viewed:
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985 times
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In lugnet.market.theory, Paul Baulch writes:
> Larry Pieniazek wrote in message <37D14FD9.3E0F3C70@voyager.net>...
> > Totally agree with Mike here (1) Arbitrage is a good thing. Arbitrage
> > also drives prices to where they belong. Taking advantage of market
> > inefficiencies in and of itself increases the efficiency of the overall
> > market in the long run.
It increases the efficiency of the profiteer market. The problem with applying
economic theory to private transactions of rare sets, is that the good is often
unique. Or rare enough to deserve that classification. Therefore the normal
rules of supply and demand artficially inflate the price, and there aren't
enough supplies of the good to bring the price down to a normal level.
The market for rare sets cannot be made more efficient in the long run because
each set is its own market, and it doesn't have enough traffic to shape it
sensibly.
To say that making a vast profit on a rare set is doing someone, or the market,
a service is simply not true. Or rather I don't trust the altruistic notions of
profiteers :) It sounds more justification than reason.
The individual can't take advantage of non-rare sets because the market will
compensate, but for rare sets we need to take more responsibility.
> Wow, isn't Capitalism cool. Actually, Capitalism is a big ol' pile of donkey
> doo[3].
> ...
> [3] Is that the correct way to start in .off-topic.debate? :-)
Nah, because there's nothing to debate ;)
Richard
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