Silly, Pandering Politicians Introduce Silly, Pandering 'Cyber Grinch' Law That Would Ban Buying Bots
from the the-grinch-turns-out-good-in-the-end dept
In December of 1983, I had just turned 9 years old, and all of my friends wanted Cabbage Patch Kids dolls. They were everywhere, and are remembered as one of the most well known holiday crazes in which scarcity of the toy, and overwhelming demand, resulted in parents absolutely losing their minds trying to find the dolls. My parents, instead, told me that the dolls were impossible to find, or super expensive if they could be found, and told me to expect something else instead. I never got a Cabbage Patch Kid, and I survived the experience (and learned a bit about supply and demand... and mass hysteria).
Anyway, I'm thinking of that experience from nearly 40 years ago today upon reading about the new "Stop Cyber Grinches from Stealing Christmas" bill, which has been announced via a press release with no actual bill text attached (which really shouldn't ever happen). However, as described, the bill would effectively outlaw "bots" that buy up all of the popular toys in order to resell them at jacked up prices:
On Cyber Monday and with holiday shopping underway, Representative Paul Tonko (D-NY), Senator Richard Blumenthal (D-CT), Senate Majority Leader Charles E. Schumer (D-NY) and Senator Ben Ray Luján (D-NM) today announced the introduction of the Stopping Grinch Bots Act. Their bicameral bill will crack down on cyber Grinches using “bot” technology to quickly buy up whole inventories of popular holiday toys and resell them to parents at higher prices. These third-party sellers use bots to bypass security measures and manipulate online sales systems to buy toys, leading to some toys being almost impossible to buy online or in stores at retail prices, exacerbating shortages caused by stressed supply chains.
“At a time when families should be able to spend time with their loved ones, digital “Grinch bots” are forcing Americans to scour online sites in the hopes of finding an affordable gift or paying exorbitant prices for a single toy,” said Tonko. “These bots don’t just squeeze consumers, they pose a problem for small businesses, local retailers and other entrepreneurs trying to ensure they have the best items in stock for their customers. Our Grinch Bots Act works to level the playing field and prevent scalpers from sucking hardworking parents dry this holiday season. I urge my colleagues to join me in passing this legislation immediately to stop these Grinch bots from stealing the holidays.”
And, sure, it sucks that bots are buying up popular items and then jacking up the prices, but is that really a situation that Congress needs to get involved in? Not all bad things need new regulations. And... I'm not one to necessarily say that the free market solves all problems, but this certainly seems like one that the market itself can and should deal with on its own. Companies can produce more of hot products. Retailers can put in place technical solutions to deal with bots and bulk buyers. And, like me and the Cabbage Patch Kids, kids can learn that they don't actually need the hottest toy on the planet (and parents can realize they don't need to buy their kids those products either).
I'm sure it must be good politics for a bunch of elected officials to claim that they're "saving Christmas," but that doesn't mean that it's good policy.
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Filed Under: ben ray lujan, bots, buying, christmas, chuck schumer, demand, holidays, paul tonko, richard blumenthal, supply
Reader Comments
The First Word
“Wil Congress ever learn?
Five years ago, Congress enacted the BOTS Act to target event ticket sniping. The FTC has brought a grand total of 1 BOTS Act enforcement action since then, yet I doubt anyone feels like event ticket sniping is fixed. So why would Congress think an anti-toy sniping law will fare any better?
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My perspective
I do have an extremely negative opinion on these "bots", as they snatched up tickets to concerts and other events to which I wanted to go within minutes of them opening up and I had no chance to get a ticket.
I think "bots" have a more insidious effect than piracy, as they've been proven to cause harm whereas with piracy the © owners sue their potential customers. With scalpers, the © owners are unable to meet their customers' demands because the scalpers put the item out of reach.
Is a legislative solution the answer? I've read enough TechDirt to know that there will always be unintended consequences to these things (like what would happen to StubHub, for instance). However, as much as I admire Mr. Masnick, I didn't see him make a case for how a specific proposal can hurt, especially since we must now consider shortages and finite economies.
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I mean, given that you correctly point out that this is just a new variation on a problem that's been going on for decades, maybe we can draw certain conclusions about whether the market actually wants to solve it.
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Re: My perspective
The government took a hands-off approach to robocalls, too, and now people just don't answer their phones anymore.
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Wil Congress ever learn?
Five years ago, Congress enacted the BOTS Act to target event ticket sniping. The FTC has brought a grand total of 1 BOTS Act enforcement action since then, yet I doubt anyone feels like event ticket sniping is fixed. So why would Congress think an anti-toy sniping law will fare any better?
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is there a single politician that actually has some brains?
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I'm disagreeing on this one...
Bots dont just affect toys. Computer hardware and other esential components to modern life and businesses is being scalped by bots. The practice of bot buying should be absolutely illegal. There is not a single use case for scalpers to exist at all in any market or jurisdiction. They are as toxic as the old debt selling and collection industry and the payday loans industry. All insidious parasites that extract billions in profit from society while giving nothing of value back to it. Hell these assclowns are also tax dodgers!
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Yeah, no. Scalpers are trash. Ask anybody who’s been looking for a PS5 or an Xbox Series X for over a year at this point. Ask folks who want to get their updgraded graphics cards for their PCs. Scalpers leveraging bots to buy up stuff are trash and asking companies to “Just make more” when there’s a huge component shortage across shittons of industries is ludicrous.
And I know you’re going with the whole toys for kids angle that Congress is going for with their bill, but grown adults want gaming consoles, consumer electronics, and collectibles as well; this isn’t just a “Do you need to buy your kids this thing?” situation.
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Re:
Ron Wyden? Chris Cox?
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800,000ish dead and because Karen couldn't get the very very best price because there is a cabal of bots out to ruin her child's Christmas.
"At a time when families should be able to spend time with their loved ones"
Enjoy your special gift of Delta or Omnicron because shopping bots matter more than getting people vaccinated & end the lies that TO THIS DAY are still coming out of Congress.
Gee once I heard about the backlog, I pushed to find out what people wanted & started shopping then. I hit a few bots that were buying things up at retail and putting them back up at a higher price... I didn't get the things with the stupidly high prices. I managed to pay just about retail for all sorts of a hot childrens toys. I paid attention and didn't buy the item listed close to MSRP that had $80 shipping hidden. I didn't get everything the child would have wanted, but managed to adapt easily.
When the kids birthday rolls around, the few items the evil evil bots had marked way up will be MSRP or better. Life continues.
Perhaps the government should unleash bots to buy up all the hot things and make them available to Karens at MSRP... but only once they get vaccinated.
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Re: Wil Congress ever learn?
exactly, it's a clear distraction from addressing the problem at hand.
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Really scraping the bottom of the "For the Children!" barrel, there, aren't'cha, sparky?
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Its not affecting my business, I just scooped up a few dozen workers at $1 per item to buy the products I'll sell for a $200 margin... Now parents are gonna have to make the decision between buying their kids presents, having a vacation, or working for me/my ilk to afford presents and a vacation
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Re: Re: My perspective
Robo calls.
Corps got upset when they couldnt do it, so bitched. Another 1st amendment thing?
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Of course, we know that these politicians won’t stop it.
We all know that these bots are from Mount Crumpit.
They don’t know, they don’t care,
whether the solution is over there.
Because their solution will always be murky:
just pinch your ears and blame section 230.
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Re: My perspective
Whats fun about this and sports and entertainment, is tha it COULD be limited. But the corps dont care enough.
They pass the tickets to a 3rd party to sell, and as long as they get sold, Who gives a flying donky's but. they consider they arnt liable for it cause its the 2nd party dealing with it.
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Re:
Nope.
Ask if any of the graduated with higher then Grade C. and its the same answer.
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Re:
LOVE the SHIPPING PRICES.
Sale priced goods and add shipping and the price Doubles or triples.
Do you want a better law?
NO FRONTING FOR OTHER BUSINESS'S.
All of them have been allowing Anyone/everyone to advert their products, anyway they see fit.
Buy that great LED 10000 Lm flash light for $15, and get hit with a $20 Shipping cost? READ all adverts CLOSELY.
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why not?
"Companies can produce more of hot products. "
NOT really.
99% of the goods (not counting Covid and shipping) were ordered and shipped over 6 months ago. Went to distribution and setup to be AT the stores 2 months ago.(love retail)
The prices started out stable and went up, since they hit the stores and sites. by about 20-30%. so that the sale prices are NOW the same as they would be if we didnt have a holiday season.
Lets go back to the old days, and have a Winter festival, and party hardy, and lots of sex and booze.
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Buy low, sell high
Kind of the heart of free market capitalism, that. The "problem" here is that these items' retail prices are set well below their true market value, a situation to which the rational response is to buy them and sell for what people are actually willing to pay for them.
And while the article doesn't put it in the same words, it does hit 2 of the 3 potential solutions: the manufacturers producing more (=increasing supply), customers wanting them less (decreasing demand) and/or raising the retail price to more closely match the expected market value.
Stores putting up artificial restrictions to people buying things is theoretically a solution, but then they'd have to literally refuse to make money to do so. Not much incentive for that. You generally only see that with sales they know are going to sell out in no time anyway.
On the other hand, complaining about people buying stuff for resale (or the tools they use to do so) is not a solution at all, no matter how much we might want stuff on the cheap for ourselves. That's not how our economic system is built.
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Re: My perspective
It's not like companies would ever set up an "at-arms-length" artificial-scarcity bot company to "buy up big" and sell high.
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'Sucks to be you little Suzy/Timmy.'
Companies can produce more of hot products. Retailers can put in place technical solutions to deal with bots and bulk buyers. And, like me and the Cabbage Patch Kids, kids can learn that they don't actually need the hottest toy on the planet (and parents can realize they don't need to buy their kids those products either).
That strikes me as remarkably similar to the oft-decried 'just nerd harder' argument that TD regularly rips into because 'just make more products' and 'just code better to stop the bots' seems to treat the issue as extremely basic and something that could be solved if the companies really cared to do so.
Could more of a given product be produced? Maybe, it depends on whether there are enough of the parts needed to do so(not a problem if it's just a matter of plastic, more so if you're talking complex electronics), you've still got a question of whether they'll arrive in time and even then you've got to deal with bots who might just scoop up the new batch same as the last.
Could platforms/stores do more to cut down on bots/bulk buyers? Probably, but it's not that simple. It's not like the bot owners scalping people like this are going to see a change made to make it harder and just throw in the towel, they're going to adapt to any changes made and force the platforms to constantly keep adapting in turn, and that's if the platform/store cares enough to do so because whether a bot or a person buys something they're still getting paid, the only person being screwed over is the customer who now faces the choice of insanely overpriced item or do without.
TD has covered a lot of PR fluff bills jousting against imaginary enemies to score points but in this case the problem very much does exist and I'm struggling to see a downside to going after bots that screw over everyone but the ones running them.
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Same with stocks then right congressman?
So this would stop "bots" from buying stocks and bonds thru algorithm modeling because the little guy can't afford to have a system like that and the buying and selling at speeds normal people can't inflates and deflates the prices only scalpers, aka banks, brokers and hedge funds, benefit from? Or would that hurt your corporate masters? It is all just pandering...
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Re:
For the most part the sellers have no reason to care, bots/scalpers are still paying the asking price so it's not like the seller is losing out on money selling to them.
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sure, don't buy items at inflated prices, and leave the 'scalpers' stuck with their inventory.
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Re
Doesn't work - somebody* will want that toy, or those concert tickets, etc. Just a matter of patience, that's all.
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Re:
Beat me to it. So-called scalpers are just retailers dealing at what the market will bear.... and are willing to live with a smaller market share. Those people who learn that someone else got the same item for less money, they're just upset that they "had" to pay more. Them's the breaks, pal.
In point of fact, scalpers cannot be stopped, with the possible exception where a person must physically show up, and a sales limit was put in place at the outset. Even that can be overcome, but it takes a little more effort. And online? No extra effort at all - false names and other ways to get around limits, there are many methods available.
But the real question is, why are there scalpers in the first place? Ah, but that's a question for a different thread. I'll leave it to others to hash that one out. :)
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Stereotype much?
Members of congress, by and large, more often have university degrees than not. All parties.
Law. Medicine. Education. Social Services. Political Science. Look it up.
Accusing politicians of being uneducated or stupid is both incorrect (generally) and missing the real problems in play.
And now, you are educated. Do you wish to continue as you were?
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Re: Re
Not always. OTOH, gaming return policies for your unsold scalped inventory is also a concern.
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Re:
So we should stop complaining about people using bots to buy up all the game consoles, turning around and selling them for almost twice their price, because that’s the free market at work? And that manufacturers should just make more in the middle of a global shortage of most components where they have to compete with almost everyone else for the chips thatare coming out? Is that what you’re saying? Because of so, that’s fucking stupid.
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Want to see scalping stop? Simple - institute price fixing.... by the government, not by some corporate cabal behind closed doors. Simply make it a law that no price for the retail transfer of an item can be for more than the MSRP. But, but, but... you say - companies can simply jack up their MSRP's and then where are we? And you just exposed your forgetfulness of the Law of Supply and Demand. If it's priced too high, the number of items sold will be lower, simple as that. I'm sure you can figure out the rest of this maxim.
Note that a retailer can charge a lower price, just not a higher one. For the same reason, this would not apply to wholesalers, jobbers, etc. Once the law becomes "common" knowledge, no one would respond to a scalper's ad for anything more than MSRP. In fact, a cottage industry might crop up, reporting any attempted scalping.
Now, does this solve anything? Stock still might run out, true, but the stock that was sold went to people who wanted it for what it is, not for an investment (i.e. scalping). Fewer people deprived, and more legitimate demand created, driving the manufacturers to work harder to keep the customers happy, and the bank account even fatter. I'd say that's an overall positive, wouldn't you?
However, there is still a real fly in the ointment, and that is the used market. Details for that have to be fleshed out as well, or this whole concept becomes null and void.
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Re: Re:
Cavet Emptor or whatever.
There has been a media push lately about do you know who you REALLY are buying from, trying to explain to people that all the items on Amazon aren't all sold by Amazon.
(I am not that shocked that humans are dumb enough to need this spelled out for them when you can look at the listing and it tells you.)
The $80 shipping charge was there on the screen for me to read before I put it in my cart, but so many people just hit buttons & complain later.
Protip:
If it says Sold/Shipped by Amazon - Amazon is selling it to you.
If it says Sold by X & Shipped by Amazon - 3rd party seller kids, coming from an Amazon warehouse.
If it says Sold & Shipped by X - its just someone using the marketplace and if you wonder how they are offering that new video card at $1000 below all the other prices... you shouldn't be allowed to shop online.
The first 2 options are the BEST options because you get Amazon guarantees & help.
Hell I might have "overpaid" by a buck or 2 in the past just to get an Amazon/Amazon or Shipped by Amazon seller version just so I can have that piece of mind.
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Re: why not?
Funny you don't look druish.
Just in time shipping is great... until the entire world STOPS for months.
Something something more concern about the prices of christmas presents than if people can afford the medications they need to live.
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Something something its just like buying bulk bandwidth, you think the markup on christmas toys is bad look at cable!
Such 1st world problems...
Can't get the gaming console/video card/toy we just have to have!
I checked... none of you will actually die without getting these for christmas.
Meanwhile the price fixing of insulin has a bodycount & grinch bots are the thing getting focus.
I hate to break it to everyone...
The world is actually FUCKED.
There is a pandemic, still.
People are trying to pretend we can get back to normal (I'm waiting for the Thanksgiving incubation to finish up).
Our leaders are PISSED that people in the service industry won't go back to being mistreated by Karens for min wage.
Our robot overlord self driving trucks never really took off, perhaps we should have made investments to promote professions that pay really well & don't require a 12 yr degree for an entry level spot.
The can of fixing the infrastructure has been kicked so far down the road that even if we had 5000 truckers appear at the docks ready to haul... the port can't get them loaded & ships offloaded to get us back to normal for a while.
This pandemics been going on for almost 2 years & somehow people think everything SHOULD be okay now.
Take off the rose colored glasses & maybe accept that you won't be getting the hot thing anytime soon, but its not the end of the world.
Somewhere in what passes for a hospital someone is struggling to breathe because someone told the asshole who infected them that the virus isn't real & you can't force us to wear masks!
But yeah Karen, Grinch Bots are the worst thing ever... (just like every fucking year when you can't get the hot item at the lowest price you think you shoudl get).
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Re: Stereotype much?
So,
Looking back at recent history.
The group that PAID to get thru school?
the Uni loves the new campus someone bought for them.
They Love those DONATIONS.
Faked Athletic scholarships?
Search paying university fake grades.
And have you done a real search for the transcripts?
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Re: Re: My perspective
we call that the black market.
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Re: Stereotype much?
ECA is an incoherent troll. It’s best to just ignore him and move on.
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Re:
Congress and government can work on different issues at the same time. Generalizing people angry at scalpers as just being Karens who aren’t concerned with real-world problems is short-sighted and wrong. People who are pissed that they can’t get PS5s or their Switches because of bots are perfectly capable of being angry at the injustices of the world, as well.
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Re: Re:
"Congress and government can work on different issues at the same time."
[CITATION NEEDED]
"are perfectly capable of being angry at the injustices of the world"
800,000ish dead people wonder where their law demanding Government be truthful about the pandemic is while they debate Grinch Bots.
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War on Christmas
I'm sure the GOP will claim that this is part of the "liberal war on Christmas", but I'm not sure if that makes them for or against this legislation.
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Re: Wil Congress ever learn?
Well if it gets them reelected they don't care about the "actually works" part.
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Re: Re: Re:
You're not strictly wrong, but my understanding is, 3rd party sellers sometimes get their counterfeit stuff into the Amazon warehouses, in the same bins as the real ones, so there's not necessarily a guarantee on what you're getting there.
And even with full 3rd party sales, you may not always be completely out of luck - Amazon got me a refund on such a purchase last year that went missing out of the mail.
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Re: Re: Re: Re:
Amazon, when they discover counterfeit merch in their warehouse destroys it.
A fast way for Amazon to discover it is consumer complaints & lots of returns.
(One is sort of shocked that Congress hasn't demanded they detect harder like they have with every other nearly impossible thing).
Counterfeits can make their way into legit sources, it happens sometimes.
But there are people who just want the lowest possible price & refuse to consider perhaps this 3rd party seller with 4 negative reviews and has only been on the platform for 3 days might be sketchy.
Amazon will do what they can to keep customers satisfied (not to be confused with happy), but acting like they can detect bots & stop them because Congress said so & ignoring that whole its a global platform thing is more pandering stunts.
Why no massive outcry about those hearty souls who trawl the backroads of 'Merika scooping up exclusive items from WalMart & other stores & putting them online at higher prices?
I mean I heard something about special edition oreos with pokémon characters on them selling for stupidly inflated prices online & people paying those prices.... for a fscking cookie.
Retail Arbitrage has always been a thing, sometimes now people do it electronically. All this outcry over holiday gifts but not a peep when wal; street does it.
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Re: War on Christmas
They don't care because the base will be fired up & ignoring anything else they do.
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Re: 'Sucks to be you little Suzy/Timmy.'
And there's your answer: do without. Scalpers are in business because people buy from them. Vote with your wallet.
I understand if you need a good computer for work, but before buying a scalped PS5, maybe compare your desire for it with how much you value integrity.
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Re: Re
So let them have it. Keep your integrity.
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Re: My perspective
"With scalpers, the © owners are unable to meet their customers' demands because the scalpers put the item out of reach"
Not true, sadly. The copyright owners still sold the number of goods they sold at the price they would have sold them for either way. The scalpers wouldn't bother doing this at all if they were left with an inventory of unsold goods at their asking prices. So, while the goods are placed out of the reach of a certain proportion of people who may have been able to buy the product had the scalpers not existed, the sales are still being made.
"I didn't see him make a case for how a specific proposal can hurt"
Off the top of my head there's 2 main things here. The first is the law of unintended consequences that you suggested - you really don't want these people writing laws about how individual tech works. Either they end up accidentally outlawing important tech concepts and how bots are allowed to operate well outside of the narrow sphere of online retail, or they'll end up writing a law that simply doesn't achieve the stated aim at all and bots are allowed to continue with a few minor adjustments. The chances of the current crop of legislators writing a bill that accurately achieves its aim with no collateral damage is vanishingly small.
The second would be a question of the target. Scalping is a major problem, and has been long before bots existed. Outlawing one current single method by which its practiced is unlikely to reduce it to any meaningful degree, and it's likely that the best way to combat it is to address the way in which sought-after goods are sold or supplied rather than how the purchase is made by an individual account.
At best, you'll probably end up with an annoying speedbump that allows scalping to continue unhindered after a short adjustment period. At worst, you end up with a hugely damaging law that causes problem in ways that we can't currently imagine. So, why even consider such a thing?
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Re: Re:
Yep. Either way, the goods have sold out and there's a new batch of customers waiting to buy the next production run. Unless they actually are driven to care that the initial sales are going to the "wrong" people, their bottom line remains the same whether they act or do nothing..
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Re: Wil Congress ever learn?
Plus, ticket sniping has the potential to really backfire on the event organiser in a meaningful way - if nobody buys the scalped tickets, they end up with performers addressing an empty arena even though they "sold out". With toys, you don't have anything that concrete. Did the next season's run not sell as well because people got tired of waiting for non-scalped toys and moved on to something else, or did the toy simply fall out of fashion?
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Re:
Define "brains". This is a good move politically - it's something they can grandstand over to pretend they're "doing something", it's an emotional issue that nobody can really disagree exists, and the likelihood of the wrong move generating any physical victims is very low. It's actually way smarter to do this sort of thing than it is to grandstand over things like child poverty and sex trafficking, where they can make lives much worse for very real victims if they get it wrong, and until politics moves away from where grandstanding and "doing something" are effective, there's nothing to lose.
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Re: I'm disagreeing on this one...
And tons of online retailers have set up systems to counter those bots. As Mike points out, why should Congress get involved when the market is already fixing it?
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Re:
Many of the consumers electronics that are impossible to get are just "the newest thing". In other words, they're luxuries, not necessities.
And while I can sympathize as one who has been unable to get a new GPU or a PS5 for about a year, it doesn't exactly harm anyone that they can't purchase them.
This law is going to be useless and a waste of taxpayer money.
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Re: Re: I'm disagreeing on this one...
...and tons of online retailers use bots for things like first level customer support, checking prices with competitors, and various other tasks. A legal ruling to ban bots could have an unintended effect where the business practices of those retailers is negatively impacted. Now, you might argue that it would be nice to hire more staff to perform those tasks rather than bots, but things could be impacted in ways that make it essentially impossible depending on the wording (e.g. staff comparing hundreds of thousands of items across hundreds of competitors would still need to do some kind of scripting to make that possible in any meaningful timescale and anti-bot language could also outlaw those scripts).
At the end of the day, retail is often an industry with wafer thin margins, and there's a number of vital uses for automation that could be made very difficult by a well-intentioned but badly designed law.
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Re:
"this isn’t just a “Do you need to buy your kids this thing?” situation"
No, it's a "do you need this thing?" situation. I'd dearly love to finally be able to get hold of an XBox Series X and like many I'm stuck in the frustrating situation of knowing I can pay a scalper but refusing to do so and getting as far as checking out my basket and having it be out of stock again before I can complete the purchase.
But, I don't "need" the console. My old XBox One is still going strong and xCloud allows me to play the few games I can't run natively. It's frustrating but I don't need a Series X any more than the average PC gamer needs an updated card, I need to go to a particular concert or a kid needs the latest toy. However you want to spin it, you're talking about frivolous and luxury purchases.
I've seen a few shortages in hardware that's actually needed for my employer (although those are almost certainly due to general shortages rather than scalping), but otherwise the overall issue is not one of need.
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Re: Re:
It is not necessarily "fucking stupid" it is, as mentioned, the market at work. Obviously there is an argument to be made that is has some ethical issues but to me there is also a difference between luxuries and primary needs. If somebody started driving up the price for food or energy, sure let the government step in. Somebody is scalping concert tickets? Not so much. The unintended consequences of such measure are most likely big.
While I'm sympathetic to the idea of reducing scalping it is an issue for the retailers/manufacturers. They need to put measures in place to reduce it. While the retailers maybe do not have much incentive to do so, manufacturers certainly do. Also artists, specifically big ones, could push ticket resellers to do more.
And, it is not as if it is only the scalpers... It needs two to tango. The scalpers can do this because people are buying from them. So, if you ever bought from a scalper, you are part of the problem.
I'm one of those people who has been looking for a PS5 since it launched. Trust me, I could've bought one if I wanted to, but I refuse to buy from anything other than an official source at the official price. Not because I cannot afford to buy it of a scalper but because I don't want to give oxygen to those practices. Would I like Sony or retailers to do more to stop it? Sure, but also my life doesn't end because I have to use my PS4 for a bit longer.
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Nice to see Congress staying consistent with its priorities: draft BS bills instead of stopping big pharma from price gouging.
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"I'm one of those people who has been looking for a PS5 since it launched"
During my lunch break, I've been reading a reddit thread dealing with the UK. One of the major used goods retailers there, CEX, in one city has a display of around 10 PS5s in their window with a markup of around 20% above retail. It's very hard to buy one new, but somehow the second hand shops are full of overpriced consoles. There's also discussion in that thread about how that particular chain seems to be quite loose around how they deal with goods, with some people talking about how when they were trying to trace known stolen goods relating to other consoles, a reasonably significant number of the stock had their serial numbers scratched off.
Now, obviously I'm not saying that the PS5s were stolen (or even that CEX are doing anything other than accepting used consoles from people who genuinely need to sell a console they own for extra Christmas cash). But, I do think that if you have a high street retailer carrying these things at prices above the retail value, who (as far as I'm aware) do not carry any new stock at all, the problem is not simply whether or not the original retailer had bots purchasing the new consoles. By the way, in my experience the UK has way more strict consumer protection laws than the US, so I can imagine that if CEX is getting away with such things there, there's bigger loopholes to be closed than whether a scalper opts to use a bot or a team of humans to do their scalping.
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Re:
On the one hand, I'd point out that it's capable of doing more than one thing at a time and that a small group of grandstanding politicians doesn't mean it's not addressing the other issues at all. On the other hand, it does expose the state of US politics that they think this is the issue to grandstand on, rather than risk calls of socialism when they demand that vital drugs are not priced out of the reach of the people who need them.
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Re:
How Nazi of you, and it did not work then, so what makes you think it will work now. One way round such controls is sell something trivial, cheap and uncontrolled at inflated prices with what the customer wants to get the real price that you want.
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Lol.. so apart from the stupid Nazi comparison, you think the way to deal with in demand goods being priced out of the range of the public by scalpers is... to also vastly increase the prices of cheaper goods?
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Re: Re: I'm disagreeing on this one...
The market isn’t fixing it. He says that it’s stuff that they could do, not that they are doing.
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It’s really not, though. People buying up products en-masse using technical means not readily available to your average person and then selling those products at a mark-up to the consumers who actually want it? That’s consumers being forced to interact with a middleman that they don’t want to interact with and paying more if they want to get the product they want in the same amount of time that they wanted. It’s a distortion in the market, consumers are harmed, and stores and companies by and large don’t care as long as they get their pound of flesh. “Be patient” and “vote with your wallet” can only go so far.
If the Invisible Hand of the Free Market isn’t gonna do anything to fix this, then I’m fine with government stepping in and addressing the problem just like they do in other instances where consumers get a raw deal and corporations don’t do shit because they make money either way.
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Re: My perspective
Hard to say when the bill itself doesn't actually exist.
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Re: I'm disagreeing on this one...
However, that doesn't mean that everything would be fine were it not for the scalpers. Their existence indicates the product may be priced below market value. When that happens you tend to get shortages. So with scalpers prices are high, and without them the product is difficult to buy at all. There is no good situation for the customer except for increasing supply.
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Re:
1) The argument against the law is not that scalpers are fine upstanding folks. 2) People who leave shopping carts laying around the parking lot are trash too, but that doesn't mean Congress should get involved.
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Customers don't get to just set the price they want to pay. If people are willing to pay what the scalpers are charging, then that's the market price by definition.
It's a reaction to the distortion of goods priced well below market rate.
So am I - in principle. My confidence in their ability to do so without royally screwing up all kinds of stuff is very low.
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Re: Re: I'm disagreeing on this one...
Or scalpers buy things at the value that consumers agree is a fair price and then jack up the price knowing that they’re the only ones that consumers will be able to get those things from in a reasonable time frame.
I think that a fair amount of consumers are okay with shortages if it’s clear that the shortages are being caused by other consumers buying the product from the stores and actually using it. Shortages caused by people who just want to flip the product to make a profit? That stuff is the stuff that folks don’t take kindly to.
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Mike’s argument against the law is that the Invisible Hand of the Free Market should step in and nerd harder to solve the problem, and consumers should just suck it up and deal with it in the meantime. The consistent coverage on Techdirt with how corporations utterly fail to self-regulate and consumers get screwed over while said corporations keep making money should serve as proof that such a solution ain’t gonna happen.
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Re: Re: Re: I'm disagreeing on this one...
And if they are charging more than what consumers are willing to pay, they won't be able to sell. If consumers are willing to pay that price, then that's the market price.
I don't know if I'd go that far, people don't like not being able to get the things they want.
That's not a shortage (unless you restrict your consideration to store shelves only).
Yep, it's a crappy situation.
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Consumers wanting a product, but having the product scooped up by a middleman, then having to deal with said middleman that they never wanted to deal with in the first place, and then having to pay an increased price to that middleman, is a distortion. If a PS5 was, say, $700 at Best Buy or Target rather than its price of $500, do you actually fucking think that would stop the scalpers from using bots to buy up stock and flip it for $1000?
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Re: Re: Re: Re: I'm disagreeing on this one...
The problem is that there’s always people with more money. The consumers buying the product at the scalper price might not be the same as the consumers that could only buy the product at the price that it mainly goes for. Consumers getting priced out of goods that they want because someone used bots to buy up the products and flip them at higher prices isn’t a good thing. Products reach the hands of people who will use them, but they aren’t always the same people who originally wanted those products.
Econ 101 is a helluva drug; y’all have got to stop using it as an excuse for letting shitty situations stay shitty.
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If people are willing to pay $1000, no, it wouldn't. If $700 is as much as most people are willing to pay, the scalpers are going to have a bad time. The specific numbers don't matter. Let d be the price customers are willing to pay. Let s be the price retailers are selling for. If d is substantially higher than s, you're going to have an opportunity for scalpers. And I don't like the situation, but when the price of a product is too low (or put another way, the supply is too low), you're going to have some kind of market failure. I don't see scalping as being any worse than shortages.
The problem is that the real solution (short of increasing supply, which may not be a viable option right now) is for retailers to increase the price. However they don't like to do that because it makes them look bad. With scalpers, they still get to sell the product, and blame the high prices on the scalpers. If the public had some understanding of economics, and realized that sometimes products are more expensive than they would like, Target could just charge $700 and people could choose whether that was worth it or not, and it would be ok. But executives know what will happen to them if they do that.
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Re: Re: Re: Re: Re: I'm disagreeing on this one...
Indeed, income inequality is a far worse issue than expensive PS5s.
No, it isn't. But it's also not a disaster, and it's not meaningfully worse than consumers not being able to buy goods they want because they're underpriced and thus unavailable.
Wanting a product doesn't mean you're entitled to it. The ultra wealthy buy the Lamborghinis I want, and just put them in garages and drive them once a year. I don't complain about this. It's just what happens when some people have a lot more money than others.
It isn't an excuse, it's an explanation. Basic economics doesn't indicate how things ought to be, it describes how things work (to the extent that the theories are correct). I'm not telling you that it's great that scalpers are reselling game consoles. I'm telling you that it's a very predictable outcome of pricing game consoles below their market price.
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We are never going to be able to address problems like this...
We are never going to be able to address problems like this until we stop acting as though "socialism" is a dirty word, or a concept espoused by terrible people. Yes, there are plenty of terrible people to claim to be "socialists" but then there are also plenty of terrible people who believe in whatever kind of government it is that we currently have. The fact is that there are terrible people in all types of governments, and given a chance some of those terrible people will try to claw their way to the top and oppress others, or take advantage of them. There have been, and continue to be governments that are very socialist and treat their people badly, but there are also governments that are very socialist by our standards (such as the Scandinavian countries) that for the most part treat their people quite well. Yet politicians and political commentators always conveniently forget that the latter type of government even exists.
The point is that a good socialist government would consider what is best for the majority of the people (while not allowing that to be an excuse for oppressing minorities). In cases like this they would see that there are a few greedy people who are trying to take advantage of others and would put a stop to it. Of course the "free market" types would howl about it but "free market" has sort of come to be code for "greedy capitalism". The reality is that the free market works as long as there is unlimited supply of an item and there are no artificial restraints on who can purchase the item. But if either of those two things are not true, then you have situation where parasitic individuals or corporations can control the supply of an item (or a service) and jack up the price just because they can. If you want a perfect example of why the "free market" doesn't work, compare what most Americans are paying for Internet service compared to what they would pay in the more "socialist" countries.
Now just to be clear, "socialism" is in no way the same thing as "communism". Communists incorporate some socialist ideas into their system of government, but it is all window dressing. In communist countries, bad people tend to rise to the top of the government and control their people with an iron fist. That is in no way what true socialism espouses. With socialism, when it works as intended power rests with the people, with communists it rests with the government (mainly because they don't respect their own laws and their constitutions, but I can think of anther country that's going down that same path), and in whatever system we have in the USA it primarily rests with the largest corporations and the toady politicians that kowtow to them, and to their lobbyists and PR firms. But again, if the news media or a political commentator mentions socialism, they usually try to use a communist country as an example, and communism and socialism are two very different things, even if that not what they taught us in high school!
(I know you could make the argument that "pure" communism would be very different from the "communist" governments we have seen, but if that is the case then I don't think there has ever been a "pure" communist government. There is just something about communism that encourages the rise of terrible people to the top positions. Perhaps Orwell had the explanation, or maybe it's some other factors that encourage the crap to float to the top in such systems, but I will leave that debate to the political science types.)
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Re: Re: Re: Re: Re: Re: I'm disagreeing on this one...
So anything that some person can afford to buy no matter how expensive and jacked-up the price is becomes the “market price”, pretty much, and your arguments are able to stay correct forever and nobody can prove you wrong so we have to just keep dealing with this shitty situation that you agree is shitty. Got it.
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This really just sounds like you want people to behave like rational cogs in a laissez-faire economics machine when that’s not how reality works.
Looking at scalpers that use the larger amount of money and the tools they have (that regular consumers don’t) to then buy multiple units of the things that consumers would be able to regularly buy, and then selling it at increased prices so they can turn a profit, and then going “Hmm, this situation is clearly happening because the goods are underpriced and definitely not because assholes are screwing regular consumers over and the corporations don’t want to do shit about it” is fucking stupid.
Are you being possessed by Ken Kutaragi who wanted people to suck it up and work more hours to afford the 599 US Dollar Playstation 3?
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Re: We are never going to be able to address problems like this.
Be careful, you may invoke the wrath of Nasch by insulting the horseshit that is free market capitalism and economics!
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Re: Re: Re: Re: Re: Re: Re: I'm disagreeing on this one...
It's not quite as simple as having one person out of 8 billion willing and able to pay a price, and I'm not sure how exactly it's determined, but if there is a large mass of people who will pay then yes that's the market price. That's what the term means.
Exactly. It can be shitty in various ways, but until the supply is increased to meet the demand, it's not going to be fixed. I don't know what it is you want to hear, but that's just the way it works. If you think maintaining the low price and having the product sell out immediately is preferable, that is fine, and it is one possible outcome of the proposed legislation (impossible to tell since there's no bill). I disagree that that would be a substantial improvement, but that's a matter of opinion.
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Those aren't mutually exclusive statements. All of these can be true at the same time:
So what is your point exactly? Are you saying the consoles aren't underpriced? Are you saying scalpers would be scalping them even if the retail price was the highest price people are willing to pay? I'm just not sure where your disagreement is, because I'm not saying that this is a good situation, or that the scalpers have their hearts in the right place, or anything like that.
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Re: Re: We are never going to be able to address problems like t
Now you're talking! The real problem isn't PS5 scalpers, it's massive income and wealth inequality, and the solution, as you say, is social democracy. I have no hope that the US will get there in the lifetime of me or my kids, but maybe I'm wrong.
There's no need for an unlimited supply, just enough to meet demand.
That's a terrible example, because it's about as far as you can get from a free market.
Don't worry, I don't get angry about people not understanding economics.
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Re: Re: Re: Re: Re: Re: Re: Re: Re:
My point is that I think that the current standard going price for a PS5 or a Series X ($500) and a Switch ($300) in stores is a good price for most consumers right now. Scalpers price a lot of consumers out of being able to afford the products they want. Making scalpers’ “jobs” harder by instituting regulations and enforcement that curbs the ability for bots to be used in this way will enable more consumers to get the products they want at those standard going prices. Will there still be shortages at the stores? Yes. But at least those shortages will have their primary cause being consumers getting the products they want at the prices they want rather than being fucked over by scalpers.
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Re: Re: Re: We are never going to be able to address problems li
So if you love social democracy and want to see it in the U.S., why are you talking up and down this comment thread like this problem can be solved by the free market when it clearly fucking can’t?
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Re: Re: Stereotype much?
someone dont believe in information.
Even if you do a look at the corruption of the Scholarly events.
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Re: Re: Re: Re: We are never going to be able to address problem
What I said is that the problem can be solved only by increasing supply. What do you think the solution is? How do you propose to ensure everyone who wants to buy a PS5 for $500 can walk into a store and do so, without increasing the number of PS5s being manufactured?
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It is "good" in the sense that both the retailer and the customer find it an acceptable price. However, the fact that many are willing to pay more means there's excess value going to someone, and you're stating that you want that excess value to go to the people who are fortunate enough to be able to find a console at that low price, and that they should have to receive that value by using the console, and not by reselling it.
I agree that would be great - if it can be done without screwing up a bunch of other stuff, SOPA-style.
I clearly am not as concerned with why people can't buy what they want as you are.
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Re: Re: Re: Re: Re: We are never going to be able to address pro
I replied to the other comment you made an hour earlier. In my reply is my explanation of what I see as the problem as it stands now and what I see as a solution going forward.
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No, it was the way the regulated prices were worked around to get the real price for goods. The cheap goods, of almost no value, were added to the transaction to enable the controlled goods to be sold above regulated price, as you could not buy one without the other. I.e you can only buy the item with regulated price of $50, if you also buy a $50 postcard. making the real price of the controlled price item $100. That was the practice by which people got round Nazi price controls.
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Re: Re: Re: Re: Re: Re: We are never going to be able to address
You mean this?
The solution with the caveat of:
So that's not a solution, it's changing to a different problem. Again, if you find that to be a preferable problem to have, I have no issue with that, but let's not pretend there would be no problem.
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Re: Re: I'm disagreeing on this one...
"So with scalpers prices are high, and without them the product is difficult to buy at all"
The products are still difficult to buy at all. All the scalpers do is artificially reduce the supply (because without them the number of people who actually got the product they wanted for themselves would be higher) and attempt to sell to the same people who would have paid the price the manufacturers sold them for.
"There is no good situation for the customer except for increasing supply."
Which is a big problem when that's not possible, either through supply issues (most electronics can't produce more right now because the chips aren't available) or through the nature of an event (if an artist can only stay one night in a particular city on a specific tour, there's no way to magic up capacity at the venue they have, and there might not be a bigger one).
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"until the supply is increased to meet the demand, it's not going to be fixed"
The problem is that the supply is being bought up by people who have no intention of doing anything but sell it for a higher price. I'm not sure what the fix is, but it's also not natural market forces.
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"I clearly am not as concerned with why people can't buy what they want as you are."
It's a big part of the issue, though. If a concert sells out because there's a huge number of fans who got in there first, that's life. If it sells out because the guy at the ticket desk just handed the box of tickets to his mate to sell them at double the price without bothering to open his booth, that's a big problem. Even if the price of the resulting ticket is the same, it's a major difference.
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Re: Re: Re: Re: Re: Re: Re: We are never going to be able to add
The problem that Congress wants to solve, that the article that this comments thread is on is about, is this:
It’s not gonna be a bill about addressing the shortages themselves or ensuring that everyone gets what they want instantly. That’s not “the problem”. I don’t know where in your mind that became “the problem”. It’s about addressing scalpers, and it’s being put forward at a time when scarcity is making scarce products even more scarce in stores. I think we’ve been talking past each other this whole time.
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Yes. Something scarce being sold out because the people who bought it are people actually interested in consuming whatever that scarce product is, that’s something that a lot of folks can understand, nod their head and go “Ah, that sucks, but fair enough”. Something scarce being sold out because people bought the scarce thing to then resell, and it could very well be out of the price range of the original consumer looking to buy it, that’s not something that makes people feel good. And my understanding is that the economy runs on confidence/trust of some sort just as much as it does money. Scalpers help to erode trust & confidence in the same way that corporate greed does.
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Bots buying bots buying …
Auto buy bots are a problem. Be it ticks, iPhones, or game systems.
At the same time “logical” limits tend to hurt the people they intend to save.
Apple had to revisit its iPhone limits. When a family of 6 with six lines on a plan try’s to upgrade all 6 phones at once on deferred payment specials, and the limit is two. You shoot the customer.
When a family of 4 wants to see whatever artist and the limit is 3…
No family is buying 20 Xbox Xs. But a hospital or daycare might.
So limited sales hurt the actual consumer as much as they help.
Bots, are a problem. But how do you tackle them?
When you block auto-buy smart programmers just creat bots (scrypts) to replicate multiple buys real fast. Adjust the buy rate to whatever the size limit is.
Banning one type of “bot” simply breeds new more advanced bots.
And then what?
Amend the law to ban bot controllers?
And control bots. And bot bots?
Head over to a dark web auction and watch bots bid/buy bots.
Bots controlling other bots. It’s a bot bot world. A mad world.
Not much congress can do to fix that.
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Re: Stereotype much?
how about this.
As most of them went to SOME law school.
A good lawyer can defend you on BOTH sides of the coin.
Lets ask them to defend and accuse and write it up.
Lets see how well they do.
Or did they not take that class. MOST of them have a 2 year BS degree.
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Re: Bots buying bots buying …
Edit: ticks = tickets
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Re: Re: Re: I'm disagreeing on this one...
How are they reducing supply? Don't they offer for sale all the units that they buy?
That isn't what "supply" means...
Absolutely my point! The only reason this is even happening is that the real solution is not possible right now.
Event tickets are a much trickier issue. In many cases there is no supply that could satisfy the demand. Taylor Swift could play a show in NYC every single night for a year, and I would guess sell every single ticket. Artists don't want to sell tickets only to the wealthy, so what to do? I think it was Kid Rock that had some inventive solutions to the problem, but I forget the details.
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Re: Re: Re: Re: Re: Re: Re: Re: We are never going to be able to
Yes, but my point is that "addressing" scalpers without addressing the underlying causes of the problem is 1) not going to really solve anything except making customers feel a little better about not having a PS5 and 2) likely to have unintended side effects. So this doesn't strike me as a particularly valuable legislative effort.
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So there's the emotional "damn rat bastard scalpers" reaction, which I understand. Other than that, why is "I don't have a concert ticket because I can't afford the money" worse than "I don't have a concert ticket because I don't have the time to camp out for three days to buy one"? Maybe some tickets should be sold at a low price on a lottery basis, so it becomes "I don't have a concert ticket because I didn't get lucky this time."
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Thanks to these bots, I camped out and the bots still made snagging tickets impossible because I couldn't get the chance to get one. Like I said in a different thread, I don't know if a legislative solution is possible, but when buying scalped tickets is the only option, you know it's a major problem.
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Re:
What about regional shortages? Example: Company A has no stores in Wisconsin. Bob buys a bunch of Company A's merchandise to resell in Wisconsin. Bob sells at 110% MSRP to recoup his transport costs. People in Wisconsin don't have to drive 4 hours to buy from Company A. Company A sells more product. Everyone wins, until your law shows up. Then Bob has no reason to spend hours in the car, Company A makes fewer sales, and people in Wisconsin can't get the goods they would have otherwise purchased. (See for example Pirate Joe's.)
Or what about long supply lines? People who live on Cape Cod, for example, pay significantly more for items because there's no convenient supply chain. Why ship to Cape Cod if you can get the same price for your goods in Boston, with less shipping?
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Re: Re: Re: Re: Re: Re: I'm disagreeing on this one...
Try expensive toilet paper, disinfectant, and other essentials.
Scalpers are all trash, no exceptions.
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Re: Re: Re: We are never going to be able to address problems li
Bacause being full of self-hate is no way to go through life.
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Re: Re: Re: Re: Re: Re: Re: I'm disagreeing on this one...
This is clearly about holiday gifts and toys, not daily essentials. If those are being scalped too, then that's a different issue.
I have not noticed anyone saying otherwise.
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Re: Re: Re: Re: We are never going to be able to address problem
Do enlighten me Toom, what have I gotten wrong? I would like to understand the issue better, and I enjoy learning about economics.
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Re: Re: Re: Re: Re: Re: Re: Re: I'm disagreeing on this one...
The fact that people can scalp toilet paper is a sign of serious economic issues.
Those stories a half decade ago about people buying normal stuff from Americans internationally by adding a zero to the end of the price were very real. Diapers, razors, etc.
That we’ve reached the point east Asia was is very disconcerting.
I applaud price limits when things get that far out of control. eBay’s maximum collection rate for goods. Amazon pulling down $100 packs of tp.
Yes, daily needs are a separate issue.
But there’s a point where free market should probably see a limitation cap.
I won’t pretend to have any clue as to how to do that fairly but:
1.3 million for an NES game?
1300 for 13 diapers?
130 for 12 rolls of tp?
There’s a point where things have gone past capitalism and free market and become a captured mandate. THAT is bad.
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Re: Re: Re: Re: Re: Re: Re: Re: Re: I'm disagreeing on this one.
"1.3 million for an NES game?
1300 for 13 diapers?
130 for 12 rolls of tp?"
Those are very different things, though. If collectors want to pay silly money for a game just because nobody before them opened the box, then let them go for that. It's by definition a frivolous purchase and nobody who wants to buy an actually used copy will be affected. I have some Star Wars toys from back in the day that would go for thousands if I hadn't played with them as a kid, but if I decided to sell them for a few quid then I'm not going to require someone to take out a mortgage. The guy buying the used toy has options, and the guy buying the unused one has more.
But, this is where libertarianism falls down. The market is a natural exploiter left to its own devices. At some point you need regulation and sense to be introduce into a market, else when people need something that they require to live and thus have no power to demand a reasonable price they will be exploited. You can't have power in a negotiation if you actually need the product to live or survive. At that point, you have to understand that markets are not always free and someone has to protect the vulnerable. Whether the current government where you live is the correct arbiter is open to discussion, but sometime the market is an exploiter.
Obviously, the government mandating a maximum price for goods is a problem, but leave it all to pure capitalists and you end up with worse problems.
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Re: Re: Re: Re: I'm disagreeing on this one...
"How are they reducing supply"
Maybe redirect rather than reduce is more correct there. The point is, they take a natural supply chain and take it where people don't have the cheaper option because they add the artificial toll.
"Artists don't want to sell tickets only to the wealthy, so what to do?"
I think it's Billy Joel who doesn't directly sell tickets for the front rows and invites real fans down to them. The point is here that when it's first come first served and it's possible to sell out in minutes, there's abuse invited. How you deal with that is a conundrum, but it's clear that allowing a bunch of people to barge in front and charge a premium to people who actually want to go behind them is not a good thing
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"Other than that, why is "I don't have a concert ticket because I can't afford the money" worse than "I don't have a concert ticket because I don't have the time to camp out for three days to buy one"?"
Why are those the only choices, and why do you think that scalpers wouldn't camp out as well?
"Maybe some tickets should be sold at a low price on a lottery basis, so it becomes "I don't have a concert ticket because I didn't get lucky this time.""
That is slightly better than "I can't go because someone programmed a bot to get the ticket before a human being had the option.
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Re: Re: Re: Re: Re: Re: Re: Re: Re: Re: I'm disagreeing on this
No. Not in the context that this was BEFORE covid.
People were trying to sell diapers and TP to China etc for beyond reasonable prices. Both eBay and Amazon stepped in to end this.
eBay has done plenty of crappy things in the last year: but I will applaud their good decisions.
Like killing “excessive” shipping/handling fees.
‘Logical’ price limits. Etc.
And Amazon is making efforts to stop both gouging and fraud.
Any market left totally free will do what naturally happens in life.
Success until only one is on top. Unfortunately the one on top often ends up the only one left.
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