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 23:59:26 GMT
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Viewed:
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15 times
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In lugnet.general, Richard Franks writes:
> 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.
In that regard, there is no "money making scheme" because rare OOP sets are
not readily available. The supercar is not a rare set. The sealed 8090 I
sold on eBay was. Arbitrage works to bring two markets into sync with one
another. Rare or unique items are not what arbitrage regulates. It regulates
markets in different areas.
>
> 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.
How do we do that? The only way to do that is to create shortage.
Metroliners are too expensive! Make them $200. Larry and I will probably buy
more than the entire amount the world will sell at that price! And what do
you mean "take responsibility" for rare sets? I set the opening bid at $1 and
let the buyers hash it out. If anyone is to blame, it is those who will pay
large amounts of money for something. It is actually those high prices that
make people think about selling their sets, which again brings down prices.
>
>
> > Wow, isn't Capitalism cool. Actually, Capitalism is a big ol' pile of donkey
> > doo[3].
> > ...
Anybody who thinks Capitalism is donkey doo just doesn't understand it or
simply refuses to believe the data.
> > [3] Is that the correct way to start in .off-topic.debate? :-)
>
> Nah, because there's nothing to debate ;)
>
> Richard
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