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From: cooper@odin.ucsd.edu (Ken Cooper)
Newsgroups: comp.sys.mac
Subject: SIMM auctioneering
Message-ID: <5000@sdcsvax.UCSD.EDU>
Date: 1 Jun 88 19:15:31 GMT
Sender: nobody@sdcsvax.UCSD.EDU
Reply-To: cooper@odin.ucsd.edu (Ken Cooper)
Organization: University of California, San Diego
Lines: 51

I have been criticized for auctioning SIMMs using electronic media. I'm not
completely sure why, and would like to clarify my perspective on this issue.

I apologize if I've crossed a USENET boundary, but I'm not sure what principle 
has been violated. I assume, since there is an established misc.forsale 
newsgroup, that the sale of personal items on the net is not taboo.  Further, 
since I have only posted two articles relating to these SIMMs, the amount of 
net traffic is not at issue either. It is clear then that the use of auctioning
is the source of the problem.

What is it that people object to about auctions?  For the seller, it has
the advantage of allowing the market to set the price; the seller knows
s/he won't be selling the product for less than it's worth.  For the
buyer, it prevents the "damn, I wish I'd checked the news two hours
ago" syndrome. Under the terms I've set, for example, all buyers have
a window of two weeks to see the offer, and determine what they are
willing to pay.  What then are the disadvantages?

It appears a common misperception that auctioning will overinflate the
price. This might be true for Van Gogh's Sunflowers, where there is only one 
source for the commodity. In the case of SIMMs, this is clearly false: there 
*are* other sources.  Who would be foolish enough to offer me more than they 
would pay elsewhere?

For me as a seller, what was the alternative to auctioning?  Forgive me
for acting in my own best interest, but I wanted the best price I could
find (Wouldn't you?).  Since I had no real sense for the value of these 
SIMMs, the only other choice I could see was to offer them at an overestimated 
price, and drop it in increments until they sold. This would have wasted more 
net bandwidth than auctioning by email, and would probably have generated more 
controversy as well.

If you find my self interest distasteful and think I'm taking advantage
of this SIMMs shortage, consider the underlying principles of capitalism that 
are at work here. If I hadn't expected to get a decent price for these SIMMs, 
I would never have offered them -- I rather enjoyed the extra memory headroom. 
This is a classic case of Adam Smith's invisible hand at work: as the price 
has risen, so has the supply. If it weren't for the greed of potential 
suppliers, there would be no supply.

I would appreciate feedback on this subject. I appreciate USENET and the
people who contribute to it, and the last thing I want to do is abuse
its privileges. Nevertheless, I don't think one should accept rules
without examining them first. If auctioning is overstepping the line, I'd like
to know why.

Ken Cooper

ARPA:			cooper%cs@ucsd.edu
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