[QUOTE=SnicklefritzG;8179201]
I don’t think it is possible to prevent shill bidding. It happens all the time on places like ebay. It is too hard to police 100% of it out of the system.
A college professor of mine was very involved in racing and would talk about how certain high profile people were paid to bid on a horse just to drive the price up. The idea was to make people think “oh, so and so is bidding on this horse, this must be a good one” and then at some point the fake bidder would drop out, having forced the bids up higher than the horse would have gone for otherwise
While I’m sure there are safeguards in place, I doubt it can be policed out of the racing scene.[/QUOTE]
I will rehash what LaurieB said in her last post. NO ONE is forced to pay for a horse any more than they planned to pay when the horse walked into the ring. There is no need to “police” the bidding and or sales process. If someone walks into the sales pavilion with a pot full of money and doesn’t know how the “game” is played. Whose fault is that? The “rules” are fully are available to anyone who takes the time to read them. It’s not like they are only available to “insiders”.
It’s no different than sitting down for a game of poker. If you don’t know how the game is played you are going to get fleeced. “Bluffing” is a big part of the game. I can play poker well enough with local my poker buddies. But no way in the world would I sit down with “seasoned” players. I’d lose my shirt.
As LauireB said, she has a set price at which she values a horse and if the reserve is more than what she is willing to give then the horse will sell to someone else. If the seller values the horse more than everyone else bidding the horse doesn’t sell. If the under bidder/s are still interested in the horse they can go to the seller and try and negotiate a price.
People who understand the “game” also understand that the Sales Company works for the seller. It is their job to get as much for the horse in the ring as possible. It benefits the seller their client and it benefits the sales company. Because at the end of the day they receive 5% of the sales. Which by the way is a bargain compared to non-horse auctions. Where they collect 10% from the seller and 10% from the buyer.
The auctioneers are the best in the business. They know how to “read” the “crowd” the bidders. A lot of the times seasoned buyer can tell when a horse is “on the market”, the horse has passed the reserve. But just because it has they do not “hammer” the horse, sell the horse to the first bid above the reserve. The bidding continue until there is a “last man standing”. But there are times when the auctioneers feels/knows there is more money in the “room” than is being bid. So at their digression they may “run” the bid up hoping to get more money out of an enthusiastic bidder. A seasoned bidder can usually but not always tell when this is happening. So they “call” the auctioneers “bluff” and “back up” the bid. As I explained in an earlier comment. So sometimes but not always an unseasoned buyer will ended up paying more for the horse than they had to.
However if the auctioneers “misjudge” the bidder and “run the horse out of bidders” and get caught with their paints down. The auction company is on the hook to pay for the horse.
"A college professor of mine was very involved in racing and would talk about how certain high profile people were paid to bid on a horse just to drive the price up. The idea was to make people think “oh, so and so is bidding on this horse”
This is one of those “urban legends, auction myths”. At least in the big leagues when playing with pros. None of us give a rat’s butt what someone else is doing, bidding by and large. That’s a sucker’s play. The majority of people who “play” in the big leagues are a very good judge of a horse. It’s not as much about picking out a top prospect as it is have a budget to pay for it. I have lost out on some VERRY good horses because my client didn’t have the budget to outbid others. I was the agent who selected Point Given and was very fortunate to have a client with deep pockets. Most of the time I didn’t.
I lost out buying Afleet Alex for my own account and partners by $5,000. Sometimes you win sometimes you loose
A lot of “known” wealthy buyers like to use an agent instead of making their interest known to the sellers and auctioneers. So the price of the horse is not inflated. A lot times when an agent has made a high profile purchase and is interviewed more times than not they will decline at their clients request to “name” who they bought the horse for.
