JR,
Do you have any interest in posters at all or just in the workings of
Heritage?
If you've ever seen their auctions you will know that when they go
live they will either say "no reserve" or "reserve not yet
posted/met", so you know immediately if there is a reserve or not.
Then as Grey and John explained, with a week to go if the reserve is
not met, the price is raised to the bid immediately below the reserve
so that if anyone bids they can win the item. This is the same price
John will open the item up for at the live auction (instead of wasting
time asking for bids that could not possibly win the item).
Heritage does not place any bids during the live auction. If in fact
they bid on item (either by an employee collector, or by a buyer
acting to purchase for their inventory), it is done prior to the
auction going live. Many times during the break at the auction John
has told me that his bids on two or three items had been outbid and he
wished he had either focused on a single item or had placed a higher
bid. Example: John wished to buy item #4 and item #5, he has a total
of $500 he can spend in the auction, so he bids $250 on each one
before the live session starts. During the session, Item #4 sells for
$100 and item #5 sells for $275. Now John is sad that he could not
bid again on Item #5 as he still had room below his budget, but
Heritage does not allow this. This policy is fair to all, is it allows
people like John to still be collectors and yet places bidders like us
(or I should say like me as it it obvious you have never bid at
Heritage) at an advantage over Heritage during the auction process.
Heritage does not push the price above the reserve when there is no
action on an item to make a single interested buyer pay more for the
item than the opening or reserve, but that does not mean they (again
either collector employees or purchasing employees) do not place proxy
bids. It would be silly if collector A has a
poster/coin/comic/whatever "worth" $5K and Heritage would be a willing
buyer for that item at say $3K, but it sells for $185 at the auction
because they would not be allowed to bid (or there is a reserve of
$2500 on the item, but it again is unsold because Heritage can't buy
it for themselves). While possibly an extreme example, you can't
remove one of the largest buyers from the playing field. Consignments
would dry up and it would not be a good situation for anyone.
----- Original Message -----
From: "James Richard" <jrl...@mediabearonline.com>
To: MoPo-L@LISTSERV.AMERICAN.EDU
Sent: Wednesday, September 16, 2009 5:12:55 PM GMT -05:00 US/Canada
Eastern
Subject: Re: [MOPO] Heritage Response
John,
Apparently I was under a misapprehension as well because I thought
Heritage still used hidden reserves. If not and, as you say, no one at
Heritage ever pushes the price above the reserve, then what was N.P.
Gresham doing? I realize you probably can't comment on that because of
the lawsuit, but now I'm just confused. Both the President and the CEO
have admitted to using a fictitious bidder who was not a real person
to bid on and even win auctions.
-- JR
Petty, John - PG wrote:
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
**
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
------------------------------------------------------------------------
-----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:
