🚀 go-pugleaf

pduffy@d.umn.edu wrote:
>

> Hmm. I've heard numerous stories of scalpers selling LOTS of N64's in
> newspaper classifieds. It's just speculation, but I think the shortage
> during the X-mas season could almost attribute to there being
> scalpers.  I know that PLENTY of cities are sold out of N64's. This is
> mostly due to scalpers. There's also a lot of cities that still have
> N64's [including mine], and that's because scalpers decided to not
> invade this area as of yet. So the cities with practically no N64's
> leave parents is a pretty tough spot, which allows scalpers to jack up
> their prices.
> 

OK.  You (and Patrick, etc.) make a good point.  You notice in all of my
posts I have not applied the scalping issue because I'm not sure it's
completely applicable in the N64 case.  But, if what you say is true:

In certain cities, what we may have is an oligopoly (not a monopoly). 
An oligopoly exists when a few sellers control the supply of the
product.  These sellers COLLUDE (very important) with each other in
order to keep the price of the product artificially high.  The best
example I can think of off the top of my head would be the oil cartels
of the Middle East.

If indeed oligopolies exist due to the fact that their are only a few
sellers selling N64s, then we do have a problem.  Oligopolies, like
monopolies, are an obvious threat to Capitalism/competition and
therefore I am personally against them.  That being said, I have a few
problems with stating the N64 situation is oligopolistic (or
monopolistic, for that matter):

1) Most ads I've seen are kids/adults selling one.  I could be off-base,
but I haven't seen very many scalpers here in Atlanta, where there is
indeed a shortage.

2) Collusion among sellers should be occuring.  I don't see that partly
due to the huge discrepancy of prices ($200-$1000).  IMO, it seems that
the market (ie natural supply/demand curve) is dictating the price more
than the seller is.  In particular, the buyers seem to be overpaying in
many cases due to laziness and stupidity (and the inability to wait). It
is still possible (in Atlanta) to get a N64 for list price.  It takes a
bit of effort, however.

3) Most stores have wait-lists.  I suppose you can argue that scalpers
place their name on numerous lists, etc. to get one.  I just don't know.

> Well, unlike grapes, it's uniformly easy to produce N64's at ANY time
> of the year. Also, N64 supply can be built up in storage to meet
> demand for later on. This cannot be done with grapes or other organic
> products. IMO, I guess the 'season' analogy really doesn't hold water.
> 

OK.  I made the grapes reference, and true, that is seasonal, so let me
make another one.  Do you remember how much you paid for RAM a couple of
years back?  A heck of a lot more than today - because materials were
more expensive. The cost/availability of raw materials often fluctuates
up and down. Why do you think Nintendo is having problems meeting
demand?

> 
> Absolutely. However, I think you're missing the point. I think all of
> us "N64 scalper bashers" accept the marketplace status quo of
> buyer/dealer, but we're just fed up with the excess of greed on the
> dealer's part. I just see scalping as an immorale thing to do. IMO, of
> course. :]
> 
> 
> Well, I think there are a few factors here that don't match up with
> the N64 situation.
> 
> 1.) Most of the N64 scalpers KNEW their was going to be a shortage.
> Nintendo probably didn't release enough N64's for the X-mas season in
> the first place, and scalpers just came and gobbled a majority of
> them.

I don't know about this.  If they did, they're pretty smart.  Did you
know in November the shortage would be as bad as it is?  I remember
reading several stories that Nintendo would meet the demand.  There is
such a fine line between scalping and good business sense.

> 
> With baseball cards, if you actually KNEW that he was going to become
> a Super-Duper rookie, and that their would be a small amount of these
> player cards released, then I can see your analogy.
> 
> I know this could be totally wrong, but why do you think they made
> scalping concert/sports tickets illegal? It's because everyone knows
> there's a SET amount, thus scalpers can buy up the tickets causing a
> shortage and can easilly raise the price. The same applies to certain
> "special" X-mas gifts each year, but the government just hasn't made
> it illegal. The SET amount really isn't known, but scalpers usually go
> after the products that WON'T be coming out truckload after truckload
> during the holiday season. See what I'm saying? Oh well....

See above...a dangerous game, to say the least.
 
> >Oh, I should add I have no interest in Tom Tuttle cards other than
> >profit potential :).
> 
> Well, isn't that why everyone buys baseball cards in the first place?
> IMO, the baseball card market has just gone down the tubes.

I agree 100%.  I was just looking through my old cards.  There weren't a
million different rookie cards or holograms or whatnot.  You bought the
cards to try to get your favorite players (Dale Murphy :) ). Value was
secondary.  Sigh...  The same thing has happened with comic books.  Buy
4 copies of 4 covers of this collectors' comic! You can't take it out of
the bag to read the story because then it'll be worthless!  Sheesh.  I
liked the stories.  I can't argue against what has happened, but it can
be sad...

> 
> Well, I'd have to partically disagree with the monoply on N64's. I
> know that in a number of cities scalpers have a monopoly on the N64
> supply. However, in other cities there are plenty of N64's to go
> around. It's just a matter of where you are.
 
See above.  If this is true (I still don't think it is), then many of my
points are invalid.

> Well, I feel it's safe to say that practically ever retailer has set
> the price of the N64 to $199.99. There could be a few small stores
> selling it for $205.99 or something, but those are rare occurences.

I believe I saw FAO Schwartz selling them for 229...

> 
> As far as scalping goes...it depends where you live. Some cities have
> been struck by scalpers BIGTIME...others haven't been touched.

True.  Now let me respond to those who question whether or not ethics
should come into play.  Economists are taught to deal with problems
rationally, without much emotion.  Doctors are taught similarly so they
won't let emotion get in their way of proper deicison making regarding
patient care. It is not easy to do.  

Part of the reason why the US is in this "mess" is because the
government has spent irrationally by trying to please everyone (Thanks
FDR, LBJ, etc.) Huge mistakes are made because decisions are based on
emotion rather than logic. No one wants to hurt anyone else. I don't
want a child to go unhappy.  But more important is the underlying
capitalistic system.

If we break the natural supply/demand curve to please a few
kids/parents, who knows where it would end? Personally, I don't want the
government telling me how much I can sell something I OWN.  This is the
underlying basis of my argument.  I apologize if this seems to lack
ethics and morals to you.

As another person stated, why are so many people upset about this but
you see hardly any negative responses to copiers, black-market goods,
etc.?  These people are much more unscrupulous than anyone selling N64s
over MSRP.  But in these cases, big, faceless corporations are the ones
being hurt.  Nobody cares about them.  But kids, that's another story...

-Mike