Competitive bidding

“ The city of New York is a purchaser in the open market of supplies exceeding in value $5,000,000 a year. This figure applies only to articles purchased without competitive bidding. There is in the charter a provision that all purchases of supplies and labor in excess of $1,000 shall be made by open competitive bidding. ”

“ The complaint of the intervenors was directed towards the system of competitive bidding. The Department of Justice is the representative of the public in these anti-trust suits. So far as the protection of the public interest in free competition is concerned, the interests of those intervenors was adequately represented. The intervenors, however, claim that the system of competitive bidding would have operated prejudicially to their rights. ”

“ You would have secured a much better bargain, no doubt, had there been twenty dealers in the room competing with each other, and a still better bargain had their number been fifty, or a hundred, or two hundred, because that would mean competition, and the more competition there is, in close contact and governed by rigid business rules, the more certain the approach to a perfect price. Everywhere in the world fairs and other gatherings of merchants are held at periodic intervals because people demand them in their effort to secure proper prices by competitive bidding and offering. ”

“ If each feature must go to the highest responsible bidder, those with the greatest purchasing power would seem to be in a favored position. Those with the longest purse-the exhibitor-defendants and the large circuits-would seem to stand in a preferred position. If in fact they were enabled through the competitive bidding system to take the cream of the business, eliminate the smaller independents, and thus increase thi r own strategic hold on the industry, they would have the cloak of the court's decree around them for protection. ”

“ There is in competitive trade a public, a social character, which monopoly destroys. Even in a simple auction, when the bidding is really competitive, price depends far less on shrewd bargaining, on bluff, or on stubbornness, than is the case in isolated trade. Each bidder is compelled by self-interest to outbid his less eager competitors, and thus the limits within which the price must fall are narrowly fixed. ”

“ They have been the victims of the massed purchasing power of the larger units in the industry. It is largely out of the ruins of the small operators that the large empires of exhb itors have been built. Thus it would appear to be a great boon to them to substitute open bidding for the private deals and favors on which the large operators have thrived. But after reflection we have concluded that competitive bidding involves the judiciary so deeply in the daily operation of this nation-wide business and promises such dubious benefits that it should not be undertaken. ”

“ They require that contracts be placed by competitive bidding, the award to be granted 'to the responsible bidder whose bid * * * will be the most advantageous to the United States, price and other factors considered.' [7] There are statutory exceptions, the relevant ones being as follows:
' (a) Purchases of and contracts for property or services covered by this chapter shall be made by formal advertising in all cases in which the use of such method is feasible and practicable under the existing conditions and circumstances. ”

“ The observations thus made show that every case must be determined upon its peculiar facts and circumstances, and the courts, before condemning an agreement to unite in a bid, must see that the agreement is such as really destroys the value of competitive bidding ”

“ A revoking side may score nothing either above or below the line except for honours or chicane. As regards the essential feature of auction bridge, the competitive declaration, it is impossible here to discuss the intricacies involved. It entails, clearly, much reliance on a good partner, since the various rounds of bidding enable good players to draw inferences as to where the cards lie. ”

“ When playing against a bidder who has the habit of overbidding, full advantage should be taken of his weakness, and whenever possible he should be forced to a high contract he may be unable to fulfil.
When a dealer who has opened with one Spade, or any other player who has passed the first round, subsequently enters the bidding, he gives unmistakable evidence of length but not strength. This is a secondary declaration, and the maker plainly announces, "I will take many more tricks with this suit Trump than any other; indeed, I may not win a trick with any other Trump." ”

“ It is true that in every association formed to bid at the sale, and who appoint one of their number to bid in behalf of the company, there is an agreement, express or implied, that no other member will participate in the bidding; and hence, in one sense, it may be said to have the effect to prevent competition. ”

“ And to make doubly sure that future bids will be completely transparent, the government will resort to electronic public bidding, or the so-called reverse auction method, where bids from all suppliers and contractors will be posted on a website, watched by the whole world, and where each bid can be improved upon by other bidders, this brings transparency to a new dimension. ”

“ The stalls, stands, and privileges of all kinds, in said market, to be used for market purposes, when offered at public sale, shall be let to the highest bidder, and there shall be no bidding on the part of said company, directly or indirectly ”

“ Some of them regarded the sale with perfect indifference, never making a motion, save to turn from one side to the other at the word of the dapper Mr. Bryan, that all the crowd might have a fair view of their proportions, and then, when the sale was accomplished, stepped down from the block without caring to cast even a look at the buyer, who now held all their happiness in his hands. Others, again, strained their eyes with eager glances from one buyer to another as the bidding went on, trying with earnest attention to follow the rapid voice of the auctioneer. ”

“ The average value of a rubber at auction is about 400 points. Any much larger figure shows bad bidding. In straight bridge the average is about 180. In settling at the end of the rubber, it is usual for each losing player to pay his right-hand adversary.
MAKING THE TRUMP. In auction, the dealer begins by naming any one of the four suits, or no trumps, for any number of tricks he pleases. Each player in turn to the left then has the privilege of passing, bidding higher, or doubling. When three players pass a bid, it is the highest made and is known as the Winning Declaration or Contract. ”

“ The much-desired and valuable picture comes up. An air of apathy seems to settle on the little group of dealers. Bidding is slow and soon ceases. The picture is knocked down to one of the dealers for a fifth of its value. And, after the sale, that little group of dealers adjourn to a neighbouring house of entertainment, where they can have a room to themselves, and a cup of tea if they require it. There they hold a private auction among themselves, and this time the picture fetches its real value. ”

“ Assume, for example, that the present value of the firm's prospects as a going concern would be only $ 9 million (net) , which is also its liquidation value. Assume that in an open bidding contest, a well informed bidder will offer the company something less than 3 million for a 51% interest (i.e., $ 9mm + $ 3mm = $ 12mm divided by 2 = $ 6mm; but since in liquidation the common stock would be worthless, the bidder would be unlikely to bid the maximum $ 6mm value on these assumptions) . ”

“ Those persons who are desirous of purchasing will be allowed to select, within certain defined limits, such portions of land as they may wish to acquire in that manner. These portions of land will be advertised for sale for three calendar months, and will then be sold to the highest bidder, provided that such bidding shall at least amount to the price fixed by Article 2. ”

“ At some of these establishments a lot of pencil cases, watches, or other goods, is offered for-sale. The lot generally contains a dozen or a gross of articles. Bids are started by the "decoys" of the proprietor, who are scattered through the crowd, and strangers are thus induced to make offers for them. Each man supposes he is bidding for a single lot, and is greatly astonished to find the whole lot knocked down to him. He is told he must take the entire lot, that his bid was for all. Some are weak enough to comply with the demand, but others resist it. ”

“ Complex as the problem appears, it is solved according to the principle of marginal utility at every moment in every market. The different uses, figuratively speaking, bid for an agent, and thus its marginal utility is determined just as is the price of a good by the bidding of buyers. Indeed, it is the bidding of buyers, indirectly. The more urgent the use, the higher the bid. The felt importance is reflected from the consumption goods that are sought, to the agent that will aid to get them. Two or more agents that are mutually needed for the acquiring of a product are complementary goods. ”

“ In the forty years I have been bidding I have found a new thrill in every sale. From my earliest years at Henkels’s auctions to the most recent sales in London, Paris, and New York, I have repeatedly known a fine exhilaration. I sniff the air like an old war horse at the smell of powder. How often have I felt my pulses race, my temperature rise with the rising bids! But as I grow older I find I have to fight that deadliest of maladies—conservatism. This is one thing in the world that the collector should pray to be delivered from. ”

“ Bidding is languid, and valuable books are knocked down for trifling sums. Let the neophyte try his luck, however, and prices will rise wonderfully. The fact is that the sale is a “knock out.” The bidders are professionals, in a league to let the volumes go cheap, and to distribute them afterwards among themselves. Thus an amateur can have a good deal of sport by bidding for a book till it reaches its proper value, and by then leaving in the lurch the professionals who combine to “run him up.” ”

“ The informatory school of modern bidding, which attempts, as nearly as possible, to declare the two hands as one, has as an essential feature the overbidding of the partner in an infinite number of cases. ”

“ Article 34
⁠A bidder may take part in bidding by himself or authorize his agent to participate in it.
Article 35
⁠A bidder shall have the right to be informed of defects of the objects of auction and the right to inspect them and to have access to information pertaining to them.
Article 36
⁠Once a bidder bids for a price, it shall be irrevocable, and it shall lose its binding force as soon as another bidder offers a higher price. ”

“ Anxious to render this Almanack of as much use as possible to the man of business, the editor has, at the last moment, found room for this document:—
CONDITIONS OF SALE BY AUCTION IN IRELAND. I. The highest bidder to be the purchaser, unless some gentleman bids more.
II. If any dispute arises as to who was the highest bidder, the sale is to stop until the parties have fought it out: but if either combatant is killed, he shall be allowed to amend his bidding for the sake of his bereaved family. ”

“ Another disinterested party whispers in the buyer’s ear that the horse will be sold at auction. Sure enough, the animal is led to the auction stables, and care is taken that the buyer sees it passing.
The auctioneer and ringman are posted, and they wait for the sucker. The horseman starts the animal at pretty [34] near his value. The bidding is rapid. The sucker gets in, and under excitement bids two or three times. Perhaps one of the regular eastern shippers bids once, but as a rule, the sucker, the auctioneer, and the scalper are the only bidders. ”

“ The bidding, of course, had stopped, owing to the unaffected interest which the public took in this more dramatic interlude. The broker, it is true, had bid twenty-five dollars, and was wrangling with the auctioneer.
“You have my bid, Mr. Brinton, sir, and there is no other offer. Knock down the lot to me.”
“You wait your time, Mr. Isaacs,” said the auctioneer. “No man can do two things at once and do them well. When Squire Moore has settled with Dick Bligh he will desert the paths of military adventure for the calmer and more lucrative track of commercial enterprise.” ”

“ That requirement is very clear when, for example, one bidder, offers an all cash deal and another offers all cash as well, but less money. It is tolerably clear when one bidder offers cash and another offers cash and widely traded securities, the package being worth less when measured by dependable markets. ”

“ Instead of being a dozen bids, all different, and differing sometimes as much as ten, twenty, thirty, forty, or a hundred dollars or more, they would bid the same. If they all agreed on the number of horses and men it would take, and about what it would cost, they would bid about alike, wouldn't they? But when they are bidding they honestly differ. One man says it would take twenty horses, and another says "no, it will take forty." Do you not know that the number of horses depends a great deal upon the kind of man who makes the estimate. ”

“ It has an appeal all its own. But for the young enthusiast it is often a costly and dangerous game. It is wiser to begin your bidding under the guidance of an experienced agent. There are several collectors and owners of great private libraries in this country whose names are entirely unknown in the auction room. They may enter the salesroom incognito, to enjoy watching their agent at battle with others, but they are careful not to run any risks themselves through careless, inexperienced bidding. One of the greatest book collectors in the world, Mr. Henry E. Huntington, [Pg 83] never bid. ”