Hi Jeff:
I think you're laboring under some misapprehensions concerning the way
the Heritage bidding system works. As the auctioneer of record for
most of Grey's auctions, let me address a couple of your concerns.
You've mentioned reserves in this post and several others, and seem to
be suggesting that auction houses should disclose reserves to their
bidders prior to bidding. You're absolutely right on this, which is
why Heritage fully discloses all reserves at least one week prior to
the actual auction date for Signature Auctions (items in the Weekly
auctions are typically offered without reserve). Remember, reserves
are set by the consignor, so if there's a reserve price you feel is
too high, that's a consignor issue. IMO, it's not in anyone's best
interest to set a reserve that's unreasonably high. That's why Grey
takes so much time and care in working with consignors to set reserves
that both protect their interests while at the same time offering a
reasonable chance to sell.
To address another of your points, when an item fails to meet the
reserve prior to bidding, Heritage will increase the bid to one
bidding increment below the reserve, and start the live bidding there.
For example, if the reserve on an item is $1,000, Heritage will
typically open the bidding at about $950 if the reserve has not been
met during online and remote bidding. The next actual bid will take
the item. Heritage's reason for doing this is simple: they feel that
their bidder's time is valuable, and don't want people wasting their
time bidding against a reserve. In the case above, if the reserve is
$1,000, and the highest maximum bid prior to live bidding is $200,
whose interest is served by forcing the auctioneer -- and the audience
-- to go through bids of $220, $240, $260, $280, etc? Even if live
bidding tops out at, say, $750, the piece won't sell and everyone's
time has been wasted. Surely you're not suggesting that that would be
a better system? With Heritage's method, everyone knows the reserve,
and they know that, if they bid, they're in the running to win the
piece. If, as you suggest, the market doesn't want to pay the price
set by the consignor, than the item doesn't sell It's as simple as
that (items not sold are clearly marked in the Heritage Permanent
Auction Archives). As for other dealers using Heritage prices as
benchmarks for their own material, that is certainly their
prerogative, as it is yours to refuse to buy a poster at a price you
feel is unfair.
I hope this addresses your concerns regarding these issues. It's
really very simple once you see it in action, and in that spirit I'd
invite you to personally attend one of Heritage's auctions and see the
process in action for yourself. Once you actually see an auction in
person, I'm confident that you'll have a much greater understanding of
the way Heritage does business.
Best,
John Petty
*From:* MoPo List [mailto:mop...@listserv.american.edu] *On Behalf Of
*Jeff Potokar
*Sent:* Wednesday, September 16, 2009 1:06 PM
*To:* MoPo-L@LISTSERV.AMERICAN.EDU
*Subject:* Re: [MOPO] Heritage Response
This sort of pricing happens all the time. All one needs to do, as an
example, is go to ebay, and find an expensive poster up for sale or
auction. Somewhere in the description, one will often find a Heritage
data base reference, for what this same poster sold for 6, 8, 12
months prior, for hundreds or THOUSANDS more-- and what a great deal
the copy being looked at on ebay is.
Is this really true? So many questions about this practice.
And one other thing that was mentioned. If a certain item has a
reserve, of say, 500.00, why does the bidding start at 200? That makes
no sense. Wouldn't it be better for consignor as well as the auction
house to simply make the reserve price of 500.00 the opening bid? Even
on ebay, this appears so silly.. an item has an opening bid of 2.00,
yet the reserve may be 200.00.
And if these shill bidders are there to get jump the bids, so that the
reserve is at least met, this, at least appears, to be tampering with
what buyers and the market want. If a poster with a 500.00 reserve
comes up on the block, and no one bids anything close to the reserve
for an opening bid, doesnt that say something about the reserve placed
and what the market may feel it is worth? For a shill bidder to
present a bid, of say, 400 to get the item going, is a false way of
getting others to bid, since the shill has no intention of actually
buying the piece.
Just some thoughts..
cheers.
jeff
On Sep 16, 2009, at 9:03 AM, Walton, Jeffrey wrote:
Yeah, I've seen this as well...but what ticks me off -- the new price
for that poster across the board is this over inflated cost thanks not
to the bidders who drove up the price but to the news of it's
sale....so now everyone who has this $5000 poster in stock and if sold
for 5k would probably make some sort of profit, now raises the
price...they can even raise it double and state -- "this just sold for
$25,000" a real bargin. And don't tell me it does happen....because
I've seen this too....the power of perception is great
------------------------------------------------------------------------
*From:* MoPo List [mailto:mop...@listserv.american.edu] *On Behalf
Of *Franc
*Sent:* Wednesday, September 16, 2009 10:49 AM
*To:* MoPo-L@LISTSERV.AMERICAN.EDU <mailto:MoPo-L@LISTSERV.AMERICAN.EDU>
*Subject:* Re: [MOPO] Heritage Response
I've actually seen this happen and not at the big auction houses you
mentioned. Two bidders on the floor got into a pissing match and each
attempting to top the other, sometimes upping the bidding price by as
much as $5K in one bid for a poster(s) that was clearly not worth the
astonishing levels it had suddenly risen to. I did question people at
the auction who knew the two bidders and was told that they were
bidding for clients who really wanted the poster(s) in question. I
also interpreted that to mean that they each may be working on a
commission based on the selling price and hence didn't care about how
high they bid, especially since they weren't working with their own
dollars. FRANC
-----Original Message-----
*From:* MoPo List [mailto:mop...@listserv.american.edu] *On Behalf
Of *Bruce Hershenson
*Sent:* Wednesday, September 16, 2009 10:34 AM
*To:* MoPo-L@LISTSERV.AMERICAN.EDU
<mailto:MoPo-L@LISTSERV.AMERICAN.EDU>
*Subject:* Re: [MOPO] Heritage Response
Incidentally, I am not saying that only one auction house likely
does this. I have seen many many results at Christie's and
Sotheby's that fit this profile. When I left Christie's in 1997,
and was looking for another auction house, I made it very clear to
Howard Lowery (who I then did three auctions with) that I wanted
NO tricks played with the bidders, and we did not have ANY of
those crazy results. And in my own auctions since 2000 I have
almost never had crazy high results (out of 400,000+ auctions).
It may not be proof in a court of law, but it sure seems
astoundingly coincidental that these crazy bidders (who love to
show up in twos!) ONLY patronize certain exact auction houses.
Bruce
On Wed, Sep 16, 2009 at 6:49 AM, Bruce
Hershenson <brucehershen...@gmail.com
<mailto:brucehershen...@gmail.com>> wrote:
I think a concern a lot of people are expressing is that we have
all seen how a poster that used to always be around say $5,000
suddenly sells for $25,000, and we have all wondered how it is
that TWO totally separate people suddenly took it into their head
to bid five times what previous people had bid. I mean, one person
can decide to do that because they feel they HAVE to have that
poster, but TWO of them seems to defy the odds.
And now some of us, in the light of these revelations, are
wondering if there really WERE two different bidders. And if a
"house account" were used to get someone to pay five times the
former "going rate" is THAT alright (and is it excused because the
person chose to enter a very high bid)? Is that the punishment
proscribed for placing a high bid, and even if it were legal in
the past, should this practice not be stopped in the future?
Bruce
On Wed, Sep 16, 2009 at 5:10 AM, Richard Halegua Comic Art
<sa...@comic-art.com <mailto:sa...@comic-art.com>> wrote:
At 02:57 AM 9/16/2009, Neil Jaworski wrote:
I agree with all James Richard's comments on this issue.
Those who feel that Heritage have an obligation to get the "fair
market price" for their consignors (and, by a happy coincidence,
for themselves) should reflect upon how these practices might have
pumped up these "fair market prices" in the first place.
Indeed, if this N.P Gresham device has been used as widely as some
people are suggesting, what extra padding is in the hobby as a whole?
Those MOPOers who claim that this is all just a playful bit of
showmanship (wedded to a fiduciary duty to poor sellers who are
too nervous to set a realistic and honest reserve) should enrol in
their nearest high school ethics class.
Neil
I said this:
*This is how it's supposed to work:
the reserve is $400, but the item starts at $200. It is Heritage's
fiduciary duty to the seller to bid up to something just under the
reserve. So Heritage might bid $390 to get the $400 bid from a
buyer. When the $390 bid is the top bid, Heritage does state
"still available at HA.com" indicating that the $390 bid did not
win the item, that it fell below reserve.
as long as that's what's going on, it doesn't seem that anything
nefarious is happening.
Here is where it would step in negative territory:
If Heritage were to continue bidding in order to drive up a price
past the reserve, without the intention of buying it themselves,
that would be a bad thing. I haven't seen or read anything that
indicates this is so. Though to be fair, I have had friends tell
me anecdotally that they feel this is the case, but they have not
given me any examples to prove that claim.
Also, Heritage does indeed sell material they own in all fields
from posters to coins to comics and this may be a sticking point
to some, however as long as they treat Heritage-owned merchandise
just as any other consignor, they do not drive up prices beyond a
reserve and they do not raise the reserve after introduction of
the auction, well, they would not be doing anything wrong*
so please don't mis-characterize what I said
If N.P. Gresham is acting improperly, that is a bad thing, but I
might need more information before I can come to that conclusion
and determine that Heritage was or was not acting improperly
concerning whether or not a consignor has a realistic perception
is immaterial to the debate because it has nothing to do with any
of the allegations against Heritage.
Rich
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