Silver Bidding Cartel... any ideas?

[beauanderos]

After reading a couple of Neil's recent posts... I'm wondering if there would be any merit to the idea of setting up some kind of pool account of forum members for placing bids on ebay? Not even sure how it would work, but the idea would be to prevent us bidding against each other and running the price up, and instead, to work together, perhaps designate one bidder... and split the spoils later. Maybe this would only work for larger lots, I don't know, but it seems to me that if we were to post certain lots listed on ebay, that were to expire in say, a week, we could learn how much interest there might be in bidding a certain item. Let's say Rodie, myself, and Neil are interested in bidding on two rolls of AU Morgans from hsturn. Instead of each of us attempting to outbid each other, we might take turns being the designated "high bidder." If we won, the other two with interest in the item would be offered, by PM, the option of acquiring 1/3 of the lot for the final price obtained, plus shipping. Perhaps we would agree in advance, by PM for those interested, that the top bid would be no more than melt, or spot plus a small percentage, etc. Then no one would be blown away by the "buy-in" price. If someone backed away from their share, and it was unaffordable for the bidder to hold, then that portion could be offered as a buy-it-now listing here. Doing something like this would accomplish many things. First, small players could participate in more bids. Second, the final price achieved MIGHT be more favorable, if a number of bidders were in collusion. What other advantages, disadvantages do you guys see in an idea like this? Not worth the trouble? Are we already doing essentially the same thing by anyone winning on ebay (with the exception of trying to game the winning bids) and then sharing whatever portion they don't wish to keep (for a small profit) on our own boards? Ideas? I'm just thinking out loud here.

[neilgin1]

Ray,
id be in, excepting i got to get me a footer foundation poured AND have my guy do the plumbing and septic up here, which is going to take a whole mess of FRN's...and my attentions.......i just waiting for these boys to get back to me.....hey, its country time up here, and if you nag 'em, that wont work.

even today, its so hot, i cant even get to the hickory sticks i skidded out the woodlot to start biscuiting them up...winters coming!!!.....and when it comes up here, you best have your ducks in order.....

but that IS a great idea, except i dont have silver, know how to buy silver...i just like to talk about it.

neil

[beauanderos]

Yeah, I know what you mean. I just remember the days when you could look at the bids on ebay and notice that, perhaps, you had placed a legitimate bid... but then were dismayed to learn that two or three "Ediots" had bid the price up forty or fifty percent above what was reasonable, just because they both wanted the lot and had decided to place a maximum bid "that no one else would outbid." Because of that, I've seen bids go double what they should have.

[rsk1963]

I like this idea.

I have wondered how many of us are stepping on toes here.

I dont have a clue how it would work either, but theoretically this is a good idea.

[Oakair]

I think this is a good idea!

You would need a large number of people involved though, otherwise I doubt it would impact the outcome (there are a lot of people who are not Realcenters and who use Ebay)

And ya, I think the best bet would be on the high priced large lots, as I feel there would be fewer bidders and the price stays reasonable...Perhaps coordinate some sort of pooled payment too, so no individual member has to front the large payment...

[Coppercrazy]

Lets not forget- ebay shows us the real physical silver market-which can very well be higher then the "market price" from commodities trading...some folks are just willing to pay % over spot.But its a neat idea.Me? I try to roll hunt it,and buy small amounts at local shops when I can.

[theo]

I like it, but it I have a concern or two.

E bay might regard this as open collusion. if they found out about what we were doing, they might over-react and void sale along with punishing the bidder. So first I would suggest that any further discussion be done in the members only forum or even by PM.

Second, I would limit any communication about a specific auction before it is completed. This could be used as evidence of collusion by Ebay. Describing it as a cartel doesn't help either. I would make it more causual. For example, if I along with a few others, let it be known that we are always willing to spend up to $200 each on 90% halves at spot or below, then another RC member could bid on a large lot of Franklin halves with a reasonable assurance that parts of that lot could be sold off. There would be some risk to the bidder, but in most cases there should be enough demand to allow the bidder to recover their targeted capital. The bidder would also be compensated by the increased ebay bucks they would accrue.

Finally, the deal would need to be good enough to account for the additional postage that would have to be incurred.

[beauanderos]

In all likelihood, we would still bid on the conservative side... and thus continue to get outbid by ediots.

[shinnosuke]

Some of my concerns have already been expressed above. I would add this idea to the mix: Why don't we have a designated hitter?

The designated hitter is the guy that does all the bidding. (We could rotate the job around to several experienced players.) The designated hitter already knows how much money he has in his backpocket. He also knows the expectations of the group. Therefore, he can bid in confidence and at the same time be fully aware that he should not let his emotions overwhelm his experience and common sense.

I work in private equity. When we establish a new fund for purchashing equities, we assemble a group of investors who pledge various amounts. When the fund is fully pledged, we start buying companies. We put out a capital call and the investors pony up. After we own the company, our staff then takes positions on the board of directors and, in time (3-5 years), we sell the company through an IPO or through an MBO or to a competitor. Any profits at that point will be distributed back to the investors based on the amont they originally kicked into the deal. We could pledge our funds in a similar way. When our designated hitter finds a good deal he can put out a capital call. (Since the payment is likely to be by Paypal, the buyer will just be putting it on his credit card. Everyone will have time to send actual funds to the buyer before his credit card payment is due.)

If the group decides to keep the item, the coins can be split amongst the group. However, if the fund is to continue operating, more funds must be pledged or a decision must be made to limit future purchases to the remaining pledged amount. If it is just one coin that cannot be divided among the investors, it must be sold and the profits distributed, again based on how much each individual investor contributed.

Tax issues when moving the cash around?

More than anything, I would like to take this discussion to another website, where membership is by invitation only. The veterans here would know who to allow. Anybody can become a member here and see any discussion in the "members only" forum which is totally cool, but that's not quite enough security for this idea.

Is this already getting too complicated

[68Camaro]

Don't know if this is a stupid question for you all or not, but I'll ask it anyway. Don't any of you all use ensipe? It's all I do anymore - for many years. I'm sure ebay hates it, but it saves me from having to follow the auctions real-time, and it hides my bidding until the last second.

I note this because I don't believe I've ever heard it mentioned here, so I don't know whether I'm way behind the times and there is something far better now, or if you all know about but just assume everyone does, or if ... possibly... ? you all aren't aware of it.

When I'm in the bidding mood (May June - not so much at the moment) I've routinely got ensipe bids lists for 20-40 auctions at a time. I low-bid everything based on max I'm willing to pay for a deal, and then just let it ride. I usually win only 1 in 10, at best, so the idea is to play the odds and bid a lot of things.

If this "group" mutually agreed on a floating price list for specific items, perhaps adjusted daily or every several days, to match spot - and then ID'd and ensiped every related item on ebay per that price list, then perhaps a buying advantage could be attained.

A private email list (google list, yahoo list, etc) could be setup for communication. Or a private forum, if you all prefer that.

I'm interested.

[neilgin1]

In all likelihood, we would still bid on the conservative side... and thus continue to get outbid by ediots.

thats the beauty of this bull, or any bull market, the "idiots" take over. some might be idiots, some are guys that are late to the party, and dont remember what it was like to pay 5, 10, 15 times face....they have no scale of prior price discovery, so paying 38 times face for $10 of 90's wont faze them, or bidding $425 for a roll of 63 BU Franklins, wont faze them...maybe some of these whacko buy it now rolls are really where the markets going to be in Sept, and arent really that whacko, just time framed wrong.

i think if some sellers were really smart, they'd look at bullion direct 90's market, check out the offers, and offer their rolls on Ebay as BIN's at 4 cents over bullion direct's offers?....they'd get snapped up...quick.

i remember a lil while back, we were in the low to mid teens, i'd hit BIN's at a plus 4 premium left and right, and i dont swing the line a lot you guys do.

in any market...of course, conservative, meaning only swing the line your wallet will let you, but in a raging bull market, we might have to bidding against new guys. the metal is at 43-45 retail and we're going to $125 first stop on the way to a 1000, so.............i'm just saying.

be well my friend, your accolyte, neil