Am I Shill Bidding?
( NO! )
Silver Stock Report
by Jason Hommel, Jan 13, 2009
I'm continuing to create new best practices in the silver dealing market, one of several dealers selling at www.seekbullion.com.
My main goal is to make sure I never sell out of silver, to make sure that I can offer some silver at some price--the free market price.
It's bad if a price is either too low, or too high. So, it's bad if I try to set a price, any price. It must be a market price.
If I set a price too low, then I can sell out, and no product is available to anyone. Also, if my price is too low, then I can't replace my inventory, and eventually must go out of business.
If I set my price too high, then I'd sell fewer products, and earn less profit.
The free market price is when a willing seller, and a willing buyer, come together at an agreed upon price, when nobody is defrauded, when nobody is forced to buy or sell, and when nobody is prevented from buying or selling.
To continue to offer silver at a free market price, I must have a minimum price. My minimum price is based on covering my cost, plus tomorrows silver price, which is the time i receive the money from the prior day's auction's highest bidders. To get as close as I can to tomorrow's price, I have to set my "reserve" price within the last hour or two before the auction.
I could list my auctions with a reserve price at the start of the auction, which is generally a day or two before the auction closes, but this would cause the reserve price to be too high if silver prices drop, which is bad for the customer. Or, the reserve price could be too low, if the silver price moves up, which would be bad for me, and ultimately bad for the customer, if I have to stop selling because of that.
So, many people like my process, think it's awesome, that I'm doing just great, that I just need to "continue what I'm doing", and I appreciate all the support.
Nevertheless, people across the internet have slandered me once again, accusing me of "shill bidding".
Fortunately, enough people understand the reality of the situation to come to my defense.
I'm not shill bidding, which is placing a secret bid on your own auctions in another name, designed to trick bidders into bidding too high.
I'm bidding on my own auctions, in my own name, in the open, at a pre-stated price, of spot plus $2/oz., which, tonight, is $13.81/oz.
I'm not deceiving anyone, which is what shill bidding is designed to do.
Some people accuse me of "locking in profits". But that's still not guaranteed for me, since the auction price is set in the evening, and the winning bidder pays the following morning or afternoon, and thus, nearly a day goes by during which time I'm exposed to changing silver prices, which is difficult for me to be "out" of the silver market for even 5000 oz., for even a day, given that I believe we are in a bull market.
So far, in the three months since I've started selling silver at auction, I've been able to cover fully, and buy back every ounce of silver I sold, plus overinvest in about 10,000 ounces of extra silver inventory. To earn that, I've put nearly 200,000 oz. of silver at risk, which means I've made, on average, about 5%. If overinvesting in silver turns out to be a "bad business decision" I'm happy to make it. So, I'm not selling out, as so many accuse. Last week, however, we were unable to be able to over invest into any extra silver.
I wonder why nobody ever accuses other popular bullion dealers of "selling out" of silver, as a means to exit the silver investing/dealing business? They only accuse me of that. Silly false accusors, they have nothing better to do with their time.
Tonight, we are offering 40 JM Stamped bars, from 6-9pm. The first of the auctions started closing 40 minutes ago.
Meanwhile, while I continue to do everything in the open, banks resort to increasing secrecy.
Reform plan raises fears of Bank secrecy
The Bank of England will be able to print extra money without having legally to declare it under new plans which will heighten fears that the Government will secretly pump extra cash into the economy.
Reform plan raises fears of Bank secrecy
Silver is payment in full. Paper money is a fraud, a false promise.
I'm offering something real.
I understand people need to become better skeptics in this age of fraud, but please check out my user ratings!
All 5 stars. I ship the SAME DAY wires come in, so you know I'm not defrauding you, and playing with your money. And people are testifying of my fast shipping!