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ir1337
88
Jul 23, 2016
This is an exercise in the free market, monopolistic behavior, and in general supply/demand. Since the product is basically a non-necessity, and a group of buyers acted together to drive up the perceived value of a commodity, we can look at prior occurrences of this kind of act.
In early 1980 an attempt was made to corner the silver market by pair off Texan brothers with deep pockets. The pair used both money in the market and more extensively, buying on margin to gather nearly a third of the world supply of available silver. Margin buying is effectively buying on credit, since they were a known quantity, exchanges permitted them great levity to purchase with reckless abandon on margin. The troy ounce price of silver went from around 6 to around 45. This artificial price inflation served to allow them to mete out their silver stores slowly to reduce the price deflation that would occur if they dumped it all quickly (who was willing to buy that much silver at once...nobody but the Hunt brothers). Their play went badly quickly, because the extraordinary amount of money required when the margin calls (creditor calling in their debt) were issued essentially busted the Hunts and the silver price collapsed. Effectively, because they could not sell fast enough at a high enough price, the market adjusted and in four days the price dropped 50%. When they no longer owned enough value of silver to cover their margin, they took a heavy bath.
How to apply this to the mtg reserved list...those who paid heavily for their cards will perhaps keep the perceived value high for a short time, but as the market adjusts, buyers become sellers and supply is restored, the market value will drop. Ultimately the buyers may make some money on the deal. Craig and his troop created a stunning level of demand for a short time, but the market will always prevail.
From a play perspective...no one was side boarding silver bars into their decks in '80, so your guess is as good as mine. ;-)
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