Find Great Deals on an Auction

An auction is like a mall, complete with a specialty store catering to the most arcane collectors. It's not how much you can find - it's how much you can afford. It's hard to pass on so many good deals!

You figure how much the item is worth to you and bid that amount. If you get it, fine. If not, on to the next auction.

Because of the nature of the bidding, you don't know the opposition's maximum; you just know that the bid is now $1 more than what you thought you were willing to pay. A marginal value fallacy sets in. If you're willing to pay $20, why not $21? And if $21 is not too much, neither should $22.

There are bargains to be had on an auction. But it's also quite easy to get sucked into paying more than you wanted by the heat of the auction. Bidding can get bloody. The process is a little convoluted. As in a traditional auction, the computer always shows the amount of the current bid. But there's no need (save in the waning moments of a crucial auction) to sit by your screen constantly upping your bid. Instead, you indicate the maximum bid you're willing to make. (Most auctions swears this isn't revealed until after the auction closes.) The winner is the person with the highest maximum bid. But this isn't necessarily what they have to pay. The amount of the high bid is figured at one increment (usually 50 cents or a dollar) above the maximum bid of the second highest bidder. If no one else bids, you get the item for the amount of the minimum bid set for the auction. (There are also the much reviled "reserve price auctions" where the seller reserves the right to not sell the item if bidding doesn't reach a specified level.)