See if you can follow me! I am a dealer and you ask me a price on something in my store. I give you my price and you say OK, I’ll buy it. I then say it isn’t really my price, I want $100.00 more. Would trust me as a dealer?
Now let me phrase this incident differently. I am an auctioneer and I start the bidding at a price. You then bid and the auctioneer immediately raises your bid. No one bids beyond the auctioneer’s price and he declares the item will not be sold (bought in).
Now, my question to you is who is deceiving the buyer, and which method is the generally accepted way of doing business is.
Obviously, both are deceiving the buyer, but if a dealer operated in that format, he wouldn’t have a career in this business, or any business very long. How come dealers and the general public put up with such deceptive tactics by the auctions? Do we all like to be manipulated buy the auctioneer’s entertaining deception skill or maybe my favorite excuse; it is just a generally accepted way of operating an auction.
Deception is the best formula an auctioneer has to create an artificial hype, and consequently, price. In an almost perfect world, where an auction starts at the reserve price (a perfect auction wouldn’t have a reserve), I would be willing to bet that good old market forces would quickly accept that standard; the insatiable demand from buyers would still create the right market price for items, and those with high reserves would have to adopt a real market value.