Track and Field Blogs - Marty Rosendahl

My wife and I just got new cell phones. They're sweet. I hated my old phone, and I decided to sell it on ebay. After doing some research to find out what kind of price point I should put it at, when to list it, how long the auction should last, etc. etc. I put it up for $19.99 as a starting bid with a "buy it now" option for $29.99. It sold in less than 12 hours with the buy it now option. I thought it was awesome since I hated that phone (rated 3.5 out of 5 by consumer ratings.)

Then something even more astonishing happened. I put my wife's old phone up for sale too. It rated a 5 out of 5 on consumer ratings, so I ramped the price up a little bit and started the auction at $29.99 with a $39.99 buy it now option. Pay attention to the $39.99 buy it now option. That auction went the entire week, and eventually sold for $41.00. My jaw dropped. I figured that by putting in a "buy it now" option, I was essentially putting a ceiling on the price of the phone. After all, why would anybody pay $41 for something they could get for $39.99? If you were at the grocery store looking at canned peas, and the price said "you have a choice, you can pay $.99 or $.94, it's completely up to you. Why would you pay $.99? I wouldn't.

So, if there are any ebayers out there, maybe you know more about how ebay works and can explain why this happened. Maybe you're a buyer and can tell my why you'd pay more for an item than the "buy it now" price, or maybe you're a seller and have some kind of nifty research into what drives to paying more than they have to for something. I've only got one theory...competition.

I'm a fairly competitive personality. I don't like to lose, and I'm willing to put myself through a lot to win. I've gotten "frothy in the mouth" over a few workouts and wound up running faster than I should have because I just got competitive. But is it really that bad with buying something on ebay? Is it a competitive addiction similar to gambling? I've read a lot of books by certified financial planners and wall street investor big shot types. Every single one of them says that people don't spend money using sound logic and careful thought. They all say that people spend money with their emotions, and that there are some people that have an emotional connection to every penny they've ever spent. Is it so ingrained that of the 8 people that bid on the phone (at least 2 higher than the "buy it now" price) not a single one had the careful thought and sound logic to say "I can get it less and end the whole works if I buy it on the "buy it now" rather than putting in a higher bid."

Should I be surprised since we're such a consumer driven society? The need for unlimited buying power has caused us to eliminate our asset based currency and adopt a debt based currency. Since then, inflation has eroded our buying power (ironic 'eh?) Used to be, expansion of the money supply and erosion of buying power could only be accomplished by people working hard to mine gold or silver. Does the ability of the Fed to "fire up the printing presses" throw kerosene on the fire of desire to buy, and in the case of my wife's phone, to buy at a higher price than what was necessary to accomplish ownership? After all, that's how we got our stimulus checks, our government borrowed the money from the Federal Reserve Bank (a privately held for-profit corporation) and now our taxes have to pay the interest on that loan (consider that according to the U.S. Government Accountability Office, 75% of all U.S. Corporations didn't pay ANY taxes from 1999-2004.)

Sorry, train of thought hit a different track there.

I'm just wondering how long the binge will last. I'm worried about the hangover. I guess as long as people are willing to pay $41 for a phone they can get for $39.99, there's no risk of sanity coming back to our consumer markets and we can expect the binge to continue. Me? I'll be starting an ebay store. If people are that eager to shop, I might as well figure out something to sell.

Marty Rosendahl