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Heritage February

440 posts in this topic

Price discovery is a tool that gives a buyer more information, like other tools. Whats so hard to understand about that? of course, any information is just noise until the final hammer comes down, but since we all bid "in the dark" as to others motivations, any news is good news, to be studies and digested for your next move/bid.

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"Price Discovery" is a silly concept. The only way to discover price is to be the last bidder. All that pre-bidding does is create conversation, whether between folks or internally for any interested bidders. But any talk that early bidding is strategic and influential on a lots outcome is purely speculative and kind of puffery. As Mitchell Mehdy would say, there is only one strategy - Win!

 

Wow...Mitch is spot-on!

 

I have no doubt price discovery works as a concept for Gene in his professional life. But I think that may also be where he's projecting here-- that other bidders are as reasonable, rational, and analytical as him. Which would be completely ignoring the reality of the hobby, which is that it's populated by total maniacs!

 

My advice: Don't bother trying to outsmart the competition in comic art auctions...all that matters is to out-crazy them. If you want to win.

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Price discovery is a tool that gives a buyer more information, like other tools. Whats so hard to understand about that? of course, any information is just noise until the final hammer comes down, but since we all bid "in the dark" as to others motivations, any news is good news, to be studies and digested for your next move/bid.

 

Exactly. Price discovery is simply the process by which prices are revealed in ANY marketplace, whether it's going into a store and seeing the $1.99 label on a bag of potato chips or working it out in an auction environment. To think that this is some esoteric process limited to, say, stock prices is to miss the point completely. Prices and price changes embed information and signal it to market participants. This is not some esoteric financial theory, this is how markets in a capitalist society operate to set prices. It requires NO simplifying assumptions whatsoever - it is not even a "theory", it is simply a description of how free markets work.

 

I've already detailed several scenarios that show where accelerating price discovery can be beneficial to some people. Anyone who has ever said that they have changed their bidding strategy or bidding target based on early bidding has implicitly agreed that they have found utility in the information embedded in prices. Of course, it's not going to be beneficial all the time to everyone - we all agree on that. For someone like myself, who had the asymmetric information of knowing that I was prepared to bid double FMV for that UXM #176 cover, of course it behooved me not to accelerate price discovery. But, there are other instances, where the tables were turned and it would have benefited me to try and get some early bidding going. If price discovery hurts those people with asymmetric information, then surely it must benefit those who don't, right? As such, of course The Vacuum is going to argue against price discovery, because he's almost always in possession of valuable asymmetric information (what he's going to bid)!

 

One Boardie PM'd me yesterday and said that "early bidding can be critical [in how I] decide to allocate fixed funds, particularly if I'm interested in a piece that might be a bit odd-ball and pricing could be all over the map." Like Aman said above, "what's so hard to understand about that?" (shrug)

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I find these discussions about accelerated price discovery interesting. :)

 

I didn't see the back and forth about price discovery as about understanding its mechanics or its basic benefits as a tool (notwithstanding some of the joking). Putting aside absolutist positions, which I don't think anyone was really advocating, the question seems to be more the extent or degree of its efficacy/value or perhaps one's "philosophical" bent towards the practice (or to me its benefits to a certain type of bidder vs. its detriments to the overall bidding process). I certainly see sets of variables where accelerated price discovery can be a benefit to a particular bidder (or by extension other similar bidders who effectively benefit by proxy). And Gene has done a good job of spelling out some examples of where it could work or seems to have worked for a bidder or type of bidder. And yes, a benefit to one bidder may likely result in a corresponding detriment to another bidder who is not similarly situated and that's the nature of a competitive, non-cooperative market.

 

But that doesn't mean that acceleration is fundamentally beneficial to overall bidding, should be encouraged or used indiscriminately, hasn't been "abused" or that other types of bidders should, to put it melodramatically, be sacrificed at the altar of price discovery. :) For example, increased information isn't an absolute "good" if its ultimate result is an increase in the price of a piece that would not have otherwise occurred (even if that information may have benefitted a bidder(s) along the way). Also, I recall a bidder admitting on these boards (I think last year) that he and others he knows have bid up the price of several high end pieces just to increase the price and see what happens. He and others seemed to be of the school (by the postings) that they would bid a high amount and sometimes even their highest amount well before the auction ends and if it accelerated the price, so be it, and if it carried the day, great, and if not, no problem. Seems a bit different than the calculated price discovery that Gene describes.

 

While acknowledging its benefits or applicability, I would hope that proponents are able to acknowledge another position--that there are instances where it is detrimental to the overall bidding process.

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Price discovery is simply the process by which prices are revealed

You mean revealed by having your bids outbid by another bidder who is bidding higher so you must bid higher than that bidder, thus discovering a higher price with each subsequent bid? Asymmetrical information indeed.

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My advice: Don't bother trying to outsmart the competition in comic art auctions...all that matters is to out-crazy them. If you want to win.

Quote of the year

Dammit, you beat me to it.

 

"Out-crazy" is a great term! lol(worship)

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Price discovery is a tool that gives a buyer more information, like other tools. Whats so hard to understand about that? of course, any information is just noise until the final hammer comes down, but since we all bid "in the dark" as to others motivations, any news is good news, to be studies and digested for your next move/bid.

 

Exactly. Price discovery is simply the process by which prices are revealed in ANY marketplace, whether it's going into a store and seeing the $1.99 label on a bag of potato chips or working it out in an auction environment.

No, because the price in an auction is a dynamic concept, not static. The price is not fixed, like a $1.99 label on an item in a store. It`s more like sub-atomic particles, where the process of observing (or bidding in this case) them actually causes them to change their behavior.

 

First, let`s discard the category of items that you weren`t really interested in anyways. I would argue that what you`re doing there isn`t really even price discovery, but more like simply determining whether your bottom fishing bid even makes it past Week 1.

 

So, if we only have items that you`re genuinely interested in winning, price discovery falls by the wayside, as was the actual case with the UXM cover that you were completely deadset on winning. Now, you say that you didn`t need to do price discovery because you knew what you were going to bid regardless. So in other words, you were subconsciously factoring in the reason why price discovery is stupid, which is that if you had put in a large bid early, it would`ve potentially gotten people talking, attracted interest, and maybe caused others interested in the piece to realize they were going to have to raise their game.

 

So doing price discovery had one possible positive outcome, which was to drive away possible competitors, and numerous possible negative outcomes, all of which result in driving up the price, and therefore you consciously or unconsciously took all that into consideration and, being a rational person, did not do price discovery on the book that you genuinely wanted.

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Price discovery is simply the process by which prices are revealed

You mean revealed by having your bids outbid by another bidder who is bidding higher so you must bid higher than that bidder, thus discovering a higher price with each subsequent bid? Asymmetrical information indeed.

 

Absolutely, the simplest example of which is getting outbid to the point where you realize you must either increase your budget or refocus your attention elsewhere. Several people have stated here and in other threads where this topic has come up (as well as offline) that they accelerate price discovery for precisely this purpose.

 

By definition, the more bidding activity, the closer a lot gets to its ultimate price. To deny that someone, somewhere, sometime, in some particular situation (which may very well be different from your own) might find that information useful is just absurd. The very fact that you admit that someone can be harmed by early price discovery is a tacit admission that someone else can benefit. Even the skeptics here admit that there are some circumstances where it can be beneficial to certain parties; the only debate is when and to what extent.

 

This is one instance where the unexamined conventional wisdom (that it is never beneficial to bid early) is simply incorrect. Maybe it works as a general rule, but there are quite clearly exceptions, which is the only point I've been making. If people still can't accept this fact, I guess we'll just have to agree to disagree, as it's really not worth debating further if you won't accept what's already been presented.

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No, because the price in an auction is a dynamic concept, not static. The price is not fixed, like a $1.99 label on an item in a store. It`s more like sub-atomic particles, where the process of observing (or bidding in this case) them actually causes them to change their behavior.

 

First, let`s discard the category of items that you weren`t really interested in anyways. I would argue that what you`re doing there isn`t really even price discovery, but more like simply determining whether your bottom fishing bid even makes it past Week 1.

 

So, if we only have items that you`re genuinely interested in winning, price discovery falls by the wayside, as was the actual case with the UXM cover that you were completely deadset on winning. Now, you say that you didn`t need to do price discovery because you knew what you were going to bid regardless. So in other words, you were subconsciously factoring in the reason why price discovery is stupid, which is that if you had put in a large bid early, it would`ve potentially gotten people talking, attracted interest, and maybe caused others interested in the piece to realize they were going to have to raise their game.

 

So doing price discovery had one possible positive outcome, which was to drive away possible competitors, and numerous possible negative outcomes, all of which result in driving up the price, and therefore you consciously or unconsciously took all that into consideration and, being a rational person, did not do price discovery on the book that you genuinely wanted.

 

I have already detailed specific instances where accelerating price discovery can be unquestionably useful (and others have testified to that fact), and you point out one example where it's not, looking only from the point of view of one individual. Like I said before, I only need to be right about one instance for you Flat Earth Society types to be wrong.

 

Everybody agrees that there are times when people should play their cards close to the vest. Maybe most times. Maybe all the time for some people. Most everyone also agrees, though, that there are exceptions to the rule. Like I said, that's my only point - that there are exceptions to the rule. I think this only became a controversial statement because I was somehow pumped up to be the poster boy for bidding early and often all the time on everything, which really could not be farther from the truth. (shrug)

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Not sure if this was posted already .

 

Richard Evans won the Action #15 original art cover, owner of the 4-store Houston-area Bedrock City Comic Company retail chain. Evans states that he intends to put the cover on display in one of his stores.

 

http://www.bleedingcool.com/2014/02/21/fred-guardineer-action-comics-15-superman-cover-original-art-sells-for-286800/

That Evans guy is just a stinking publicity hound. Makes me sick :facepalm:

 

Nice! Congrats buddy!! (thumbs u

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Not sure if this was posted already .

 

Richard Evans won the Action #15 original art cover, owner of the 4-store Houston-area Bedrock City Comic Company retail chain. Evans states that he intends to put the cover on display in one of his stores.

 

http://www.bleedingcool.com/2014/02/21/fred-guardineer-action-comics-15-superman-cover-original-art-sells-for-286800/

That Evans guy is just a stinking publicity hound. Makes me sick :facepalm:

 

Nice! Congrats buddy!! (thumbs u

 

 

He forgot to mention his trademarked Bedrock Breath Mints are available at ALL FOUR LOCATIONS!!! :facepalm: Missed opportunity to cross-market.

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Price discovery is simply the process by which prices are revealed

You mean revealed by having your bids outbid by another bidder who is bidding higher so you must bid higher than that bidder, thus discovering a higher price with each subsequent bid? Asymmetrical information indeed.

 

Absolutely, the simplest example of which is getting outbid to the point where you realize you must either increase your budget or refocus your attention elsewhere. Several people have stated here and in other threads where this topic has come up (as well as offline) that they accelerate price discovery for precisely this purpose.

 

By definition, the more bidding activity, the closer a lot gets to its ultimate price. To deny that someone, somewhere, sometime, in some particular situation (which may very well be different from your own) might find that information useful is just absurd. The very fact that you admit that someone can be harmed by early price discovery is a tacit admission that someone else can benefit. (I didn't admit that. What I admitted was that bidding occurred...which is what happens in an auction.) Even the skeptics here admit that there are some circumstances where it can be beneficial to certain parties; the only debate is when and to what extent.

 

This is one instance where the unexamined conventional wisdom (that it is never beneficial to bid early) is simply incorrect. Maybe it works as a general rule, but there are quite clearly exceptions, which is the only point I've been making. If people still can't accept this fact, I guess we'll just have to agree to disagree, as it's really not worth debating further if you won't accept what's already been presented. (I don't deny that the cause of bidding early or late can have some effect. But it isn't some deep conceptual tactic. It is simply bidding.)

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Not sure if this was posted already .

 

Richard Evans won the Action #15 original art cover, owner of the 4-store Houston-area Bedrock City Comic Company retail chain. Evans states that he intends to put the cover on display in one of his stores.

 

http://www.bleedingcool.com/2014/02/21/fred-guardineer-action-comics-15-superman-cover-original-art-sells-for-286800/

That Evans guy is just a stinking publicity hound. Makes me sick :facepalm:

 

Nice! Congrats buddy!! (thumbs u

 

 

He forgot to mention his trademarked Bedrock Breath Mints are available at ALL FOUR LOCATIONS!!! :facepalm: Missed opportunity to cross-market.

We are actually going to cross-promote these...

Supergirl Pajamas

Supergirl%20New%2052%20Pajama%20Set.JPG

Available at all four (and soon to be five) locations!

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