[meteorite-list] Meteorite economics revisited

From: Matson, Robert <ROBERT.D.MATSON_at_meteoritecentral.com>
Date: Thu Apr 22 10:32:45 2004
Message-ID: <AF564D2B9D91D411B9FE00508BF1C86904EE5A22_at_US-Torrance.mail.saic.com>

Hi All,

On the subject of meteorite economics, I have a couple comments --
actually, more ~reminders~, since this ground has been covered many
times before. I'm going to use Adam's recent e-mail as a talking
point since it mentions the key issues that come up again and again
on meteorites and pricing. My comments are NOT addressed at Adam,
but rather at any meteorite dealer.

> What this statement means is that it is not going to be offered
> for sale to the public at $2.80 a gram when $5.00 a gram was paid
> in the field. This stunt was pulled in the past in order for one
> dealer to prove a point to another without consideration for
> collectors and other dealers who took a loss because of it.
> This is called collateral damage, innocent people hurt by somebody
> else's actions.

When someone offers material at a fire-sale price, I fail to see how
that hurts other sellers of the same material. After all, what's to
stop those sellers from simply buying-out the "rogue" seller?

> How could this be a good thing when most dealers will not even pursue
> a new fall anymore unless it lands in their backyard? They will not
> pursue new falls because there is no reward for doing so when somebody
> is willing to sell below their cost in order to prove a point.

This is a self-correcting situation, as one of two things is going on
here. Either,

1) the low-ball seller eventually bankrupts himself with his vengeful
altruism, or

2) he's still making a profit (even at the low-ball price), in which
case the other sellers must have uncompetitive margins or unrealistic
goals for return on investment.

> Do you want only a single source collecting new falls and distributing
> the material? Do you have any idea what kind of damage this could
> cause if the single source was unreasonable?

Why, yes - no damage at all. Meteorite dealers don't set prices --
buyers do. Since meteorites are a non-essential commodity, if the
price is too high, people simply go without.

--Rob
Received on Tue 02 Mar 2004 09:28:36 PM PST