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By: one million words, Pete Jahn
Oct 18 2010 3:01am
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The Ethics of Trading

The alternative title for this article should be "Baiting the Trolls,"  because that's pretty much what this will turn into.  There are at least three ways to look at all of these issues.  I am going to try to to discuss each of them, so please read the whole article before you start flaming.  If you start screaming at me for believing the first view, shout "DON"T YOU UNDERSTAND THAT..." and then proceed to paraphrase the second perspective, you look like an idiot.  Er, more like an idiot.

Baiting trolls is like eating chips and dip.  You know you shouldn't, but it is so hard to resist...

Back on topic

"Pack to power" article series have suddenly become popular.  Several people are doing it, or trying to.  The concept is that the author starts with a single card, or the cards in one booster pack, and trades those/that for some other cards.  Then he trades those cards for other cards, and so on.  In the end, he trades his way up to one of the Power Nine (in the paper world) or a something like a playset of Force of Will online.  He has traded - assuming he makes it - a couple bucks worth of cards for a card worth a couple hundred bucks worth of cards.  He has made a lot of money.

The flip side, of course, is that this is only possible if his trading partners have lost a lot of money.  This sort of trading is a zero sum game.  No value has been added in the process.  The only thing that has changed is the ownership of the cards. 

Let's look at a traditional manufacturing, by comparison.  Manufacturing adds value, even at the smallest scale.  For example, I make furniture as a hobby.  I sell some of it.  I buy $500-$600 worth wood, screws, glue, stain, some carriage bolts, etc.  I add in a mixture of time, skill, wear and tear on various tools and so forth, and I produce a table and some chairs.  I have sold those for $1,000 to $1,200.  I have added value, and that added value justifies the difference between the cost of the materials and the price of the finished product. 

(A quick caveat:  The above is a pretty simple explanation.  It glosses over tons of nuances.  I spent six years in college, counting grad & undergrad work, studying this stuff.  I have literally bookcases stuffed with additional material - but that does not make the previous paragraph untrue.  This is a primer, and for that purpose, it is good enough.  To put it simply, adding value through manufacturing means improving something.)  

Cards involved in trades do not gain this sort of added value.  I recently traded for an Obstinate Baloth.  Despite having been traded around a bit, that Baloth does not cost any less, does not beat any harder, and does not have any additional features it did not have when it  first came out of the pack, or when it was first spoiled.  It's retail and wholesale prices may have changed, but the card itself is not improved in any way.   It still plays exactly the same way it did at the prerelease.  No value was added.   

Not all changes in price/cost are driven solely by the value added in the manufacturing process.  Wholesalers, distributors and retailers add value as part of the distribution process.  Generally, those participants make their profit by buying in large volume and selling / distributing at lower volume. To illustrate the process, let's look at those irresistible potato chips (crisps, for those people putting extra syllables into Aluminum.)  

Potato chips are produced in factories by the millions.  They are shipped out in truckloads.  Now I like chips and dip quite a bit, but I am not in the market for a truckload of chips.  After all, chips go stale, so they have a very limited shelf life.  Even stores that sell a lot of chips don't want chips by the truckload.  Instead, they order their chips from a distributor.   Generally, the stores buy a couple boxes of chips (a box contains, IIRC, 12 large - $3.99 size- bags per box), or maybe a pallet of chips.  A pallet holds a couple dozen boxes.  A truck holds a lot of pallets.   Only distributors can afford to buy truckloads of chips. 

Distributors buy truckloads - or even trainloads - of chips, and then ship pallets of chips to smaller wholesalers.   Smaller wholesalers ship out chips by the box to smaller retailers.  The price per bag of chips, when you buy them by the truckload, is a lot less than the $3.99 the chips retail for.  Big distributors, however, have the warehouse space, and the money, to buy chips - and everything else - in that sort of volume.  They also have their own distribution systems, so they can pack trucks with pallets or boxes of chips - plus small orders of lots of other things - so they can profitably deliver smaller amounts to their downstream customers.  

Distributors and wholesalers also provide some level of service in overcoming distance.  They generally ship product around.  This is true for physical products, but less true for digital items.

In paper Magic, the same sort of distribution takes place.  While most paper players buy packs, or maybe by display box, boosters are initially packed on pallets.  I have seen a pallet of boosters.  A pallet is a four by four by four foot cube made entirely of boxes, each box hold six displays of boosters with 36 boosters per display box.  That's a whole lot of boosters - over 35,000 per pallet, by rough calculation.  The distributors, and maybe a few giant retailers like StarCity, buy in that sort of volume, but games stores could never afford to.  Most games stores buy a couple displays at a time.

In Magic Online, however, there is no distribution chain.  All packs are either bought from the Wizards Store or won in tournaments.  Wizards does not offer volume discounts - packs cost the same whether you place an order for 1 pack or 1,000 packs.  (Okay - retailers can get special promo cards, but the value of those promo cards is nowhere close to being a significant bulk-buy discount.)  Transport issues do not arise - the digital cards exist only in the MTGO databases.  Nothing is transported. 

Still looking - and not finding - any added value.

Retailers also generally offer their customers some convenience.  I buy chips at my local grocery store or corner market instead of the chip factory because they are local.  I could probably save fifty cents a bag buying from the factory outlet store, but driving a couple hundred miles to save fifty cents is not convenient.  For Magic singles buyers, the convenience of dealing with a vendor like MTGOTraders.com is that they are extremely likely to have the cards I want.  Occasionally, they are sold out of some of the chase rares, but only occasionally.   Online, I can hit the MTGOTradersBot and have a very good chance of being able to buy the cards I really want, immediately.  That is an added value.

However, the traders trying to go "pack to power" don't have the inventory to provide that sort of value.  They may have a couple dozen or so cards up for trade late in the series - but nothing like the tens of thousands of cards in the MTGOTraders.com inventory.   Sure, it is theoretically possible that the smaller-volume trader has a card that a player needs for a soon-to-start tournament, and that the larger dealers do not, but the odds of that are vanishingly small.  If I suddenly realize I need a fourth Inferno Titan for a deck I will play in a DE in 15 minutes, how likely is it that I will have time to find a pack to power trader with one for trade?  If I need that Titan quickly, I'm headed for the MTGOTradersBOTs.

So, if the pack-to-power traders are not adding value  to the cards, living off bulk discounts or providing additional convenience, how do they make enough money to obtain a playset of Force of Will?  Simply put, they make sure their trading partners lose a little bit of money on every trade - and by making those small loses add up.

A game of Magic is a competition with a winner and a loser.  Trading - as the pack-to-power traders do it - is exactly the same thing.  The main difference is that Magic is no longer played for ante.  Trades with these guys, on the other hand...

A HUGE caveat here: I'm not saying that all trading is evil.  Large dealers, like MTGOTraders.com (and even the other ones that don't sponsor this website) do provide added value, in that they maintain a large inventory and have a reputation for integrity, prompt delivery, etc.  I have no problem with what they do.  On the contrary, constructed Magic would not be possible without them.  I also have no problem with players trading off their spares.  If I open a Baneslayer Angel in a draft, that would be my fifth copy.  I have no need of a fifth copy on MTGO, so I would trade that card for some spare cards someone else has. If we get equal value on the trade, that's fine.   It is a collectible card game, after all, and trading is part of collecting.

What I have problems with are small traders who look to make a profit on every trade.  Personally, I have problems with the ethics of making that happen.

Let's look at a trade.  The trader is offering a Verdant Catacombs, a (Vampire Nocturnis),  three Captivating Vampires and an Obstinate Baloth for a Null Rod.  We have all seen or heard of trades like this.  Six cards for one may look good, but based on MTGOTraders prices at the moment  the trader is giving away $15.60 worth of cards and getting a $21.00 card.  If both players have knowledge of the market values of these cards, that trade never happens.   

A lot of trades-for-profit occur only because the person the trader is trading with does not know the current of market value of their cards - and the trader is deliberately taking advantage of that lack of knowledge.  I so often hear traders asking "what do you value this / these cards at?"  An inaccurate answer to that question is never - at least not in my experience - followed by "actually, that card is now worth a bit more."  Instead, the trader is looking to see what his victim undervalues, and those are the cards he trades for. 

I know many of you may be thinking "yes, but caveat emptor" - it's the other person's fault if they try to trade without knowing the value of their cards.  That's a position - but I don't buy it.  My problem is that these traders are not offering anything of value - they are making their profit solely off the mistakes other people make in valuing their cards.  

Ethically, I could not do that.  I would consider it immoral.  Of course, YMMV. 

When I trade, I generally use some standard price list to make sure that the trade is equal.  Online, I use MTGOTraders.com.  In paper, I use SCG.  The choice of list does not matter, provided only that the list values all cards fairly.  Any major vendor's list will be close to market prices (provided they have at least one copy in stock), and so long as both participants use the same list, the result should be a fair trade, or at least one acceptable to both parties.  For example, I might be willing to trade away my fifth Baneslayer for some rares I needed, even if the retail value was slightly in your favor, if I needed the rares.  The difference, though, is that I know what that discrepancy is, and I'm willing to forgo it because I, personally, don't value a fifth copy of any card as highly as the ones in the playset.  Put another way, the person I'm trading with is not banking on my not knowing the value of my cards.  In this case, he's helping me turn my spares into cards I need.  (Of course, the odds are that we'll end up with him tossing in some filler until the value is equal...)

This does raise one additional issue:  converting draft leftovers into more drafts.  The is a real value provided by some dealers.  Drafters have leftovers.  They need packs and TIX for the next draft.  Many dealers buy from drafters at something less than retail, simply to make it easier for drafters to get their next draft in.  They are buying at wholesale, and selling at retail - and making a living off the difference. 

I have no problem with that.  Again, provided that everyone involved understands what is happening, that's cool.  Dealers who make a living at trading need to make a profit.  If they can't they can't afford to stay in business, and if they don't stay in business, it will be really hard to assemble the decks that keep constructed events going.  I don't even have trouble when a dealer tells someone with a Null Rod that they can afford to pay $15.60 for that card.  That's fine - the dealer is making an offer, and the seller can accept or refuse.  My problem, above, was that the trader offering the above deal was implying that the deal was far and balanced when it wasn't. 

In many ways, I am trying to draw distinctions between shades of gray.  Some of the pack-to-power folks do their trading trading cards for TIX.  Are they helping convert draft leftovers to TIX or exploiting players lack of knowledge of their cards' market value - or both?  If it is a mix of both, is that right or wrong?  It's not completely clear. 

Speculation, Hoarding and Insider Trading

Here's another set of gray lines.  Suppose we make a trade that involves some cards that are of nearly identical value.  For example, assume I trade you a (Vampire Nocturnis) and a Defiler of Souls for a Frost Titan.  At the moment, that's pretty close to even.  However, I strongly expect - I could almost say know - that the value of Frost Titan is going to go up after the results from the2010s (a/k/a States), while the value of the others is going down.   If I think you don't understand that, and I don't tell you, am I trading ethically?  If I were in this particular trade, I'd explain, and I'd probably throw in some additional cards.  Again, YMMV.

Prices rise and fall over time.  The value of any particular card rises if it appears in decks people are copying, and drops when it does not.  This clearly happens after every major tournaments.  A constructed GP or Pro Tour will cause the value of some cards to skyrocket and others to plummet.  That's life.  Trying to predict those changes - that's speculation.

For example, before States, people betting against Fauna Shaman, and betting on Primeval Titan probably did pretty well.  People betting on Vengevine probably did worse.  People buying or selling those cards at the market price before States, hoping that the price changes could make them a profit, were speculating, but there is nothing unethical about that.  If they are using publicly available information, and making informed guesses, that's their right.  It is also another reason for a trade to appear unfair - but be okay.  If one party to a trade values a card at higher than market value because of potential future uses, that could be one reason to rationally pay more than market price.  (However, most often the market price will already factor that in.)  Provided both parties understand what is happening, then neither party is acting unethically.     

Speculation is, basically, gambling on future outcomes.  It only becomes problematic when it is not a gamble.  If you know something, rather than predict something, you are no longer speculating.  Trading on non-public knowledge about future events is called insider trading, and it is illegal in many places and circumstances.  For example, when I was a playtester for the original Mirrodin set, I knew that AtogBottle Gnomes and (Triskellion) were all being reprinted.  Had I bought those cards based on that knowledge, that would have been insider trading.  However, insider trading is not really an issue with the pack-to-power folks, so I'll leave that for other times and other venues.

Another questionable tactic is to buy or sell in sufficient quantities to affect the market price, then take advantage of the price mismatch before the market can correct itself.   The supply of some of the Classic sets is small enough that this is theoretically feasible, and may have happened with cards like Survival of the Fittest and Natural Order.  Maybe.  The trick is to buy in sufficient volume to jack up the market price, then unload before what you bought can drop back to equilibrium price.   You can also do the reverse - flood the market to depress the price, then buy before the price rebounds.   This sort of thing is forbidden in many stocks and futures markets, but the MTGO marketplace is not sufficiently regulated to include prohibitions on that sort of thing. 

Conclusion   

So, is trading evil?  No.  As generally done, a lot of it is even ethical.  Some trades, though - well, morally, I would never make them.  Ditto the pack-to-power approach/   Again, YMMV.

Okay, I've covered the ethics.  Next week I'll talk about the economics of trading.  Until then - well, enjoy watching the trolls on a rampage.

 

PRJ

"one million words" on MTGO 

 

 

60 Comments

Hey Pete, some thought by Paul Leicht at Mon, 10/18/2010 - 04:00
Paul Leicht's picture
4

Hey Pete, some thought provoking comments there. I am not entirely sure I could ascribe strict moral standards to a game in general, but I do acknowledge that insomuch as the game entails dealing with money there are definitely lines to cross that determine whether someone is scum or not.

I've blocked a few people for attempting to power pack me. (One guy claimed I wasted his time by refusing to trade my Knights of the Reliquary x4 right before they shot up from .5 per to 5 tix per.) (He also wanted the 4 for cards worth far less than 2 tix.) I knew they would be going up so I refused and he got mad when I canceled the trade. He even got one of his troll friends to join in the harassment. I just shrugged blocked them both and never looked back. It is definitely Caveat Emptor in magic, because there are those whose motto is Carpe Diem at any cost.

On the other hand I know plenty of people who deliberately offer more value than they are getting so it isn't an entirely underhanded proposition. That said I tend to trade with bots more than people and if I am trading with someone it's probably due to an auction not a private conversation. Very rarely I engage in casual trading just for fun with friends. That doesn't happen too often though since most of the time my friends are just not into trading.

I think part of the blame for how trading works online has to fall squarely on the design of the v3 GUI. If it was a little more friendly trades might be more fun and less of a hassle.

By the way I recently discovered the source of one of the common bugs that plagues traders (and I noticed several other people mention this on the mothership but it should be spread about. If you have any filters on at all in your collection and you attempt to deal in anyway with getting or receiving tickets you will get the bug that hides the items you traded for until you relog. I sent in a bug report as soon as I proved it but got 0 response back from WOTC other than the usual boilerplate.

I do agree that it isn't by Prodigal at Mon, 10/18/2010 - 06:58
Prodigal's picture

I do agree that it isn't morally right to try to do these things to people, but I disagree with your logic.

A single person trading this way is in a way a small dealer. They make profit through exchanging cards. You say that these crafty traders are knowingly ripping people off. A large scale dealer is knowingly ripping people off, too. The difference is, that because they have a huge inventory of cards that cycle quickly, as well as good advertising (most mtgo players know about these bots), they can afford to rip people off a little bit at a time.

You can argue that the bigger bot chains must adhere more strictly to the 'invisible' market value. This is a good point, and you can see the market influence just by comparing bots. However, these small traders who try to pack to power are also influenced by the market price (just not as much). I'm sure that these people would want to trade their pack straight up for their force of will, but nobody would take that trade. They have to rip people off little by little (more than dealers, but still gradually) to build up to that.

Seriously, with the advent of the internet and smartphones and cheap computers making internet almost omnipresent, it is VERY simple to check market price. Since most people know about bot chains like MTGO Traders, they could just open up a very simple query for the cards in question, or even go on a website like supernovabots that gives prices on a static website in nearly real time (updated every 15 minutes). So either these people don't know about bots, or they don't want to go through the hassle of selling their card to buy the cards they want. In other words, these people may use the 'small trader' for convenience and to save time.

Oh, and really, the person trading to these scam artists have just as much choice in those transactions as they do in transactions with big bots. It's not like these pack to power people can install some virus on your computer to take your cards or do harm to you if you do not accept their rip-off trade. I'm sure the worst that can happen is that you cancel on them, you receive some naughty words from them and you block them. It's not really a big deal and much easier to refuse than a real life trade, where someone really big or with a weapon COULD possibly harm you or coerce you into a transaction you don't want to do.

Let's use your chip example. The supermarket is like the big bot, and a random person on the street is your scam artist. The random person can go in the supermarket and buy a stock of chips and then try to sell them to passerbys on the street for a mark-up. It may be an unethical thing for this person to do. Everybody has a different buy price... (and everyone a different sell price). Some people are willing to buy higher than others, but the higher the price, the fewer people there are that would accept it. What these scam artists do is just find the people who have a higher buy price. The bots sell at a 'market price' and try to get the most efficient profit margin (less profit per transaction but the most profit overall - profit per transaction * number of transactions).

As for the people who buy in bulk (speculators), I think it's only wrong for stuff that isn't in print and has a very limited print run (ahem, duals). I think those people who hoard hundreds of duals are MUCH worse than these people trying to pack to power. People speculate with stocks all the time... call it unethical. As for the insider trading... it isn't like stocks, man. I'm sure you can dig up information on spoiled cards on the internet if you search well enough.

It's your right to state that these people are immoral (I don't think it's exactly great, either). But if you're going to try to rationalize it and try to make your argument more 'objective' (trying to declare it as something stronger than an opinion, aka being persuasive), then please use more logic...

(Call me a troll if you want, but at least debate me fairly and logically. That's all I ask.)

A few points to consider by Plejades at Mon, 10/18/2010 - 08:23
Plejades's picture

Hello Pete,

interesting article about a sensitive topic. As one of the current evil "Pack to Power" traders at MTGOacademy.com I would like to add my "two tickets" to the discussion as I believe there are a few points that warrant a second look. I do hope that I do not come across as "Troll", but I have to make my point on this clear.

I do NOT believe that you have to make unethical trades to grow collection values and frankly I also don't believe that the "zero sum" theorem is applicable for a trading card game and I am not sure why this theorem is falsely used in so many articles.

Arguments are easy to refute if you show the flaws in the underlying assumptions. So I will state two strong assumptions you are making in your article to support your reasoning and conclusion and try to show that they are debatable (I apologize in advance for my own flaws in grammar and spelling - English is my third language).

Assumptions:

Dealer prices are what mostly defines value of Magic cards and trading Magic cards is a "zero sum game".

Quote: "The flip side, of course, is that this is only possible if his trading partners have lost a lot of money. This sort of trading is a zero sum game. No value has been added in the process. The only thing that has changed is the ownership of the cards."

While you are putting this assumption into perspective with arguments ranging from "added value" from dealers to "trading extras" you are still using it as one of your main pillars to define what is a fair trade. There are many factors that influence value which also makes the economic "zero sum" theorem void. I would actually argue that Magic has a significant enough possibility for "Pareto improvements" to kill the notion of zero sum economy. Let me give two simple examples:

a) I am trading a card "worth" 5.5 tickets for your card "worth" 6 tickets which completes your set you want to redeem.
b) I am trading you 500 commons you need for your decks "worth" 3 tickets for your 2.5 ticket rare. I am happy as I traded up and you are happy because you can finally start building some fun decks you had in mind.

Of course dealers would love everyone to believe that their pricelist in fact IS value but ultimately it's only what a dealer wants for a card or is willing to pay for it - not more and not less. This is especially apparent for low circulation cards which again make it possible to increase value without screwing someone. For example:
You have a promo foil you bought from a bot for 8 tickets that is very hard to get and you sell it a few weeks later to a collector who is happy he finally got the card for 12 tickets from you. I cannot see how anyone here got screwed. The bot, because he valued the card for 8? The happy collector who finally got the card he was looking for?

Of course there are trades that are obviously unethical - trading your Craw Wurm for a kids' Force of Will cannot be put in a perspective that argues with Pareto Improvements or other factors. I just wanted to stress the fact that you can do trades over and over, improve value without wracking havoc doing so. I have and will continue to make trades that provide value for both sides, use free resources that are available to everyone (such as freebots) and find the right buyer who sees the added value you are denying exists for the small seller (quote:"Online, I can hit the MTGOTradersBot and have a very good chance of being able to buy the cards I really want, immediately. That is an added value. However, the traders trying to go "pack to power" don't have the inventory to provide that sort of value.")

What you are missing here is that a small trader can use another resource to compensate for the lack of inventory - time. I am willing to invest time to find the buyer that exactly needs the few cards I have thus providing the same value as a big dealer that according to you has the right to profit.

I am happy to hear more arguments on this, in particular why you believe in the "zero sum" nature of Magic: The Gathering.

Best wishes and happy trading,

Plejades

Wrong assumptions by Jarunik at Mon, 10/18/2010 - 08:58
Jarunik's picture

I dont agree with your assumption that the "fair value" of a card can be defined through a "somehow fair market index of a major traders". I agree with you that it is reasonable to use them as indicators for stupid trades though.

I also don't agree with you that the "Pack to Power" are somehow unmoral or unethical. The online market is intransparent and fragemented by design and a major part of the game experience. You can easily prevent bad trades if you just know how to basically play the trade game..

Suggestion how the trade experience could be improved:
- Provide online real price indexes within MTGO based on actuall trades
- Provide online trading tools that are state of the art for online transaction and auctions
- Provide a online currency which can be split up in order to allow "normal" trading of commons. (It could be either virtual currency that can be split however or soemthing like gold tix, silver tix and copper tix similar to other online games)
- Provide online possiblity to show a valuation of the card acccording to some index/price list whatsoever.

=> There are a lot of virtual markets and even games with virtual markets which work way better than the MTGO system. Why not improve MTGO?

=> There will always be player "shark" traders independent of the system.

=> It is a trading card game and trading is most obviously a major playground of the game. Trading IS competitive by intention.

Hi by jmedina at Mon, 10/18/2010 - 10:04
jmedina's picture

Hello,

This is Mr. Pack to Power (Jonathan Medina). I just wanted to pop my head in and say "Hi" and of course to share my opinion. Since I don't consider myself an unethical thief. :)

Your article lacked convincing reasons to support your points. For example, you said that you went to school to learn how to create furniture and this adds intangible value to the work that you do. I agree with this, since not everyone has the knowledge that you have. What I don't get is how you can use the value of knowlege to support one claim but disregard it to make your point, that trading for value is unethical.

Knowledge of card prices and trajectory have value, because the require time and resources to acquire. To give this to someone for free should not be mandatory. Do you freely offer your furniture customers lessons in making furniture? Why should I be responsible to educate?

While my trade partner was having a great time, getting drunk and drafting with his friends, I was studying pricing trends and top 8 decklists. Yet, somehow my time is not worth anything to you (nor is my newfound knowledge) instead, I am supposed to use this knowledge to educate the guy who doesn't care enough to check prices for himself?

Maybe, I should stop doing my homework in school and then I can call my classmates unethical swine when they won't give me the answers on the test. They spent their time studying and doing the homework, but I don't care. I can't be bothers to do those things, so obviously I expect that all my hard working classmates will just hand me the answers, right? If they don't give me the answers, they are clearly stealing from me; robbing me of the opportunity for me to pass the test.

Here is my full response to this type of thinking:

http://mtgmetagame.com/the-myth-of-ripping-people-off-tricks-of-the-trade/

Enjoy!

I had a snarky reply here, by Scartore at Mon, 10/18/2010 - 10:22
Scartore's picture

I had a snarky reply here, but decided to delete it after a more thoughtful perusal of you own blog posting, which i found fairly well reasoned and does not make you sound like a magnificent ass. I do think this:

"Maybe, I should stop doing my homework in school and then I can call my classmates unethical swine when they won't give me the answers on the test. They spent their time studying and doing the homework, but I don't care. I can't be bothers to do those things, so obviously I expect that all my hard working classmates will just hand me the answers, right? If they don't give me the answers, they are clearly stealing from me; robbing me of the opportunity for me to pass the test."

Is an absolutely ridiculous and pointless example, and does make you sound like a magnificent ass.

one million words's picture

I was going to take these in order, but I have to clear up at least one misconception. My undergraduate and graduate work was in economics, and that's my profession. The furniture making is self taught, and a hobby.

To clarify - I don't think that trading is per se unnethical. What I do find unethical is a trader presenting a trade that he/she knows to be weighted in his/her favor as balanced. That's lying. John, I hjave never watched you trade, I have no idea if you represent your trades as even. If you don't, and will admit - when asked - that the balance is in your favor - then you are not one of the people I consider unethical. (I would not knowingly making unbalanced trades, but that's a personality difference. I was trained in econometrics. Some take that training and become quants creating derivatives. I didn't. I have a far more constraining moral leash. Doesn't make me right or wrong - just more constrained.)

You raised the knowledge of card values issue. That's a big chunk of part two - the cost of developing that knowledge. You can either earn it - by spending the time you did - or you can rip it off by copying major dealer price lists. A lot of people rip off SCG and MTGOTraders - which is both theft and less efficient than earning it. Either way, it is critical to trading for a profit.

As for whether you should educate - I believe in altruism. I believe the answer is yes. YMMV.

A deeper question - you appear to be saying that your advantage is that you have studied values, so you know them better than anyone else. That may well be true. What I cannot understand is how that can benefit you in a balanced trade. It can only benefit you if you make trades that you know to be weighted in your favor. That means you are profiting because your trading partners are misidentifying the present or future value of their cards.

If I'm missing something, please clue me in.

There is a long spectrum of moneymaking techniques, from crafting from nothing but pure intellect/skill (e.g. some artists, scientists, etc.) to outright con men. Trading where the proft is derived merely from knowing the value of something better than the people you trade is not illegal. It is not even clearly unethical. It's too close for me: I don't have the stomach for it.)

Your final analogy is irrelevant, of course. In no way is recommending fair trades equivalent to condoning cheating on tests. That's like saying that that, since cannibalism is unethical, I must consider all traders to be cannibals. I suspect that you were either rushing your response, or you should have taken some time off from studying card prices to study logic. If all As are Bs, and all Bs are Cs, then A does have property C. However, that does not work going backwards. In any case, I didn't say that all traders are unethical - just that all traders who lie or msrepresent thier trades are unethical.

Back Again by jmedina at Mon, 10/18/2010 - 15:59
jmedina's picture

People who lie are unethical?

Duh, right?

In regards to my last example. I was drawing a parallel between studying for school and knowing your prices. The "test" being the trade tables. Like anything in life you have to enter the world of trading with a mindset of preparedness. You can't depend on your trade partner to do the work for you and we cant call traders immoral for not educating someone who didn't care to learn prices for themselves. Just like we cant call these imaginary classmates immoral for not giving an unprepared student the answers to a test.

(Here is my education to the uneducated)

If you don't know the prices of your own cards, then don't trade them.

...

It's simple but people have a hard time with this one. I don't have the skills or the knowledge to cook blowfish (Fugu), so I don't. People should follow in my footsteps if they don't want to be taken advantage of at the trade tables or die from eating ill-prepared fish.

You stated that you don't know how I trade. My instinct is to break it down for you, but instead I will direct you to the pages of content the I've written on the topic.

http://www.mananation.com/author/jonmedina/

If you're going to call it stealing you should at least read the series right?

In regards to educating people, I do,(probably more than any other person has on the topic), but I am not going to give everyone that I trade with the rundown and full pricing portfolio of every card that's on the table. I'll tell them how much I'm giving for a card, they can take it or leave it. If they misjudge the value of a card then that's on them not me.

For the Record: I have moral guidelines that I follow which align with my spiritual beliefs. I still defend the position of free market and knowledge / time is valuable and deserves to be compensated.

I am not a fancy, educated economist like yourself, but to say that making money off cards that are raising in price is unethical, is just silly. The whole stock market is driven by these types of deals.

Anywho, Take some time to read my article "The Myth of Ripping People Off" and some of the Pack to Power stuff. This will give you a better idea of where I stand.

one million words's picture

I was talking about ethics in general. However, if you insist on dealing with the specifics of your trading.

I looked at a couple pack for power articles. Take trade 72, for example. You tell the guy that shocklands have dropped massively in value, and that the value of the lands are about 40% of the values you show deriving the net for the trade.

I'm glad that you have moral values that align with your spiritual beliefs. However, I read a lot of history, and I have to note that Cotton Mather, Jim Jones and Thomas de Torqumada would also make that same claim.

I have no problem with making money off cards that rise in price. I do have problems with misrepresenting the value of something solely to make a profit.

Stock market investments - long term at least - are not the same as what you are doing in the pack to power series. I think that's closer to the corporate raider model of T. Boone Pickens and the like, from the late 80's.

I actually had to go and read by ShardFenix at Tue, 10/19/2010 - 10:50
ShardFenix's picture

I actually had to go and read that trade...but to sit there and convince someone there cards where worth over 50% less than what they were just makes you a piece of shit.
"The tough part of this trade was valuing the Shock dauls. I put the Watery Grave at $5 the Steam Vents at $3 and the Temple Garden at $2. He was very resistant but I told him that they were not in Extended and that they have been doomed to the depths of 100 card EDH decks. He obliged and this was the full trade:
My (10.24)
Vendilion Clique 8.99
Lodestone Golem 1.25

His (46.15)
3x Explore Foil 1.49
Temple Garden 9.99
Watery Grave 12.99
Steam Vents 11.99
Harrow Textless 2.99
Tectonic Edge .99
Khalni Garden Foil .99
Restore Balance .75
Voltaic Key .99

Net +35.91"

You sir are not a BAMF as you claim in the opening of your article, but rather just a sleazy mother fucker.

lol by jmedina at Tue, 10/19/2010 - 12:37
jmedina's picture

I stand by my reasoning. I'm not going to take Shock lands at "full price" just because online retailers don't want to lower their prices.

People don't typically trade for shock lands at full price because they only see play in EDH. So, obviously I'm not going to take them at full price and risk losing value.

You might notice that I didn't place a gun to this guy's head but instead I explained why I was offering the value that I did. It's no secret that the shock duals were priced higher at certain dealers. The fact that my trade partner was hesitant shows that he knew about the pricing discrepancy but my reasoning was enough for him to let them go at a cheaper price.

Keep in mind that my trade partner was not a dealer, so he has no way to get "full price" for his shock lands. Let's be sensible here.

Fact: Shock Lands are in low demand.

This effects alot of things, including the price that dealers will pay.

My trade partner has the opportunity to gain value (cards that he wanted) out of cards that he didn't want. He could have gone to the dealers but he probably wouldn't have got a better deal.

So, I'm sleazy because I offered my trade partner a service? Am I sleazy for hookin' him up with cards that he can use in decks?

There was nothing shady going on here, I didn't lie to the guy about what the cards were worth. I simply gave him my offer and my reasoning.

Is there something wrong with that? He didn't have a problem with it, so I'm not sure why you do. :)

Only you can speak to your by Paul Leicht at Tue, 10/19/2010 - 13:13
Paul Leicht's picture

Only you can speak to your ethics/motives. But I will just point out that manipulating someone into agreeing with you does not make you right. :) Not saying you are wrong...just food for thought. There is a group of people in this world who deliberately and with forethought use verbal language and sound and body language to get what they want regardless of the cost to others. Are you one of those? If not kudos on being lucky.

Smooth Move by jmedina at Tue, 10/19/2010 - 13:46
jmedina's picture

I see what you did there. lol

No, you're perceived as by MMogg at Tue, 10/19/2010 - 18:24
MMogg's picture

No, you're perceived as sleazy because you said this, "I put the Watery Grave at $5 the Steam Vents at $3 and the Temple Garden at $2," and then proceeded to list them at:

His (46.15)
Temple Garden 9.99
Watery Grave 12.99
Steam Vents 11.99

If you truly and logically feel, and it makes sense, that their value is $5, 3 and 2, then the list should reflect that. Giving someone a reasoned answer why they're worth less for the sole purpose of intentionally trading them away a day or so later at the prices in the list ($10, 13 and 12) makes you perceivably sleazy. You don't have to buy into what we're saying, but no matter what you say to defend it, a lot of people are nevertheless going to think those practices are sleazy.

Prices by jmedina at Wed, 10/20/2010 - 12:23
jmedina's picture

I used Cool Stuff Inc prices to measure all trades. No matter if I agreed with the price or not, it gave me a standard to measure the value of a trade. There were many times during the process where I stated, that I didn't agree with the pricing of Cool Stuff Inc.

Sometimes their pricing had me win in a trade when I didn't and sometimes they had me lose in a trade when I didn't. The prices were for people to get a feel for the trade, they were not gospel.

Also I didn't intend to trade them for the prices listed, instead I only wanted to get more than I gave for them. I didn't have a "buyer" at those prices, so I very well could have (and probably would have) traded them at 6,4, and 3.

I know that people are going to perceive me as all kinds of things. I would be stupid to fight this notion, but I think it's important the explain the merits of trading for profit and value that it brings to the community to have access to people who are in the middle of dealer and player.

Clarification by jmedina at Tue, 10/19/2010 - 12:41
jmedina's picture

@Pete
I didnt tell him that they dropped. I made an offer based on the market and demand for the cards. I gave him a reason for my valuation. It was enough for him.

See above for more info.

paper magic sucks..online the by ShardFenix at Tue, 10/19/2010 - 14:56
ShardFenix's picture

paper magic sucks..online the prices reflected the switch almost instantaneously, so there was never a discrepancy except for the handful that were able to sell off shocklands in the first couple hours of the announcement, but it was public knowledge then. Though even now after the announcement and with them onlyn seeing play casually and in edh they are still closer to 7-10 a piece than the 2-3 you got them for. Though maybe the person was also an idiot who traded them... but without the longer explanation it did look very shady on the surface.

Shady on the Surface by jmedina at Tue, 10/19/2010 - 16:56
jmedina's picture

There are so many factors in the realm of trading paper magic and it’s completely different than MTGO. For example, people who play MTGO, have more access to immediate gratification than paper players (let’s face it, all magic player wants instant gratification). If a paper player is broke and wants to play a deck NOW, then the ability to trade for the cards that they “need” is a blessing.

On MTGO you simply sell your leftovers to a bot and then buy the cards you need. This isn’t always possible in paper magic.
As a trader, I see myself as a service provider. I don’t need any Magic Cards. I have a full set of Power Nine and every card that I need to build whatever deck I want. So, why do I work at maintaining a trade binder full of relevant cards for each format? Why do I spend time looking through people’s binder and building a deal that works for both of us?

I do this to be a service to my community.

Do I make money while doing it? Sure, but only because I can’t justify the time I spend reading, calculating, trading, traveling and buying/selling in any other way. My level of involvement has become much higher than “regular-hobby” level. The innocent days of batting against my friends Sliver deck with my 72 card mono-black deck (full or 1 and 2-ofs) are long over.

When I come to my local shop, I have to be there 30mins before the tournaments to service the needs of the local player base; players who don’t have the money to buy new cards every week.

It has been so long since I by ShardFenix at Tue, 10/19/2010 - 17:01
ShardFenix's picture

It has been so long since I have even looked at paper cards I forgot how trading was in paper. I can see now that they are totally different animals. I guess keep doing what your doing. I dont really have any personal opinion of paper ethics since I dont deal with it. I guess seeing how slow the paper world moves in pricings and card acquistions that things may not change pricewise as quickly as online.

lol by jmedina at Mon, 10/18/2010 - 10:30
jmedina's picture

I can't help it, sometimes I make myself sound like a magnificent ass. Thanks for looking past that to read my real thoughts on the topic.

You sir are a magnificent gentleman, not a magnificent ass. lol

Shades of Gray by ArchGenius at Mon, 10/18/2010 - 10:55
ArchGenius's picture

Trading online, the way the game was originally intended is dead. The whole "let's trade and see if there is anything you like" type of trade is ridiculously inefficient and a waste of time in most cases. Most traders have a very small list of cards they want.

Most of the outrageous, unethical, take advantage of little kids, type of trading occurs because there are new players who don't know this type of trading is dead, and sharks who are willing and able to take advantage of new players.

I've read Plejades articles and he doesn't do this type of trading. To use your potato chip analogy, he and those like him online, are usually acting as personal grocery shoppers. Bots and big traders are not looking at everybody's individual buy and sell advertisements on the board. Most of us don't have the time to wade through the pages of advertisements that are somewhat poorly managed by the Classifieds board.

Damn, everyone went ahead and by Splendid Belt at Mon, 10/18/2010 - 11:44
Splendid Belt's picture

Damn, everyone went ahead and made all the good points before I had the chance. I will stick my oar in and say that (in my opinion) Caveat Emptor is a more significant rule than you make it sound. Anyone is free to cancel the trade at any time. There's no need to click 'Confirm' unless you're happy, and even then the system gives you a second chance to back out.

If you're fool enough to rely on the person you're trading with to tell you if the trade is fair or not (and the vast majority of casual traders I've interacted with have been honest and reliable), then well... caveat emptor. This is a wider life lesson, and is in no way exclusive to Magic.

"Hello Mr saleman, I'd like to buy your used car. It looks really expensive and rusty, but if you tell me it's just fine, then I'll hand over all my cash and break down fifty yards up the road."

I don't see how the 'value' argument works. Neither will the NYSE, the LSE or any other trading system from the 'real' world. A has something. B wants it. No extra value needs to be added other than A's willingness to let that something go for a price.

I once traded away an Angel of Despair for roughly half of its value because I didn't check my mental prices were up to date. I didn't get angry at the buyer, well done him, he got a bargain. I learnt a lesson though. And that lesson was caveat emptor.

In conclusion, thank you for a thought provoking and interesting article.

excellent discussion by wasted at Mon, 10/18/2010 - 12:13
wasted's picture

I'm just curious if you think I'm devious for selling cards to a major dealer knowing they will go down in price in the near future. Here's an example I didn't cash in on. I could have sold my Tarmogoyf playset just a short while ago for much more knowing their price was going to dive with the format rotation.

Also, have you people studied economics or something? This discussion is pretty knowledgeable.

We also seem to have a lot of by ArchGenius at Mon, 10/18/2010 - 12:22
ArchGenius's picture

We also seem to have a lot of people here who have studied Latin... :-)

lol for real I needed Google by wasted at Mon, 10/18/2010 - 12:24
wasted's picture

lol for real I needed Google for this.

Additionally, what about me selling any cards I get during prerelease events and early during release events that I know will quickly drop in price?

As another Pack to Power by Dr. Albert at Mon, 10/18/2010 - 12:54
Dr. Albert's picture

As another Pack to Power trader, I would like to echo Medina's comment and hopefully add another salient point to this discussion.

You've done a great job of addressing the primary market and what makes it tick. Raw materials manufactured into goods, which distributors resell to stores, who then resell to individual customers. All of what you said about that is well and true.

What you neglect to give much credit to is the secondary market.

After the primary customer buys a manufactured item, this item still has value. And if the primary customer decides that they don't want the item anymore, they can choose to engage the secondary market as a way to gain some of that value.

When you open a booster pack, you will probably lose value. There's a chance that you will open some sweet card like a Koth, but you have almost certainly traded ~$3.50 for a piece of disposable foil and 15 pieces of cardboard that are mostly worthless. Think about the sum value of all the packs you've ever opened. Yeah. This is the game we play.

The hope, then, is that you either crack enough packs to get the cards you need for your deck (unlikely, unless you are very wealthy or don't want a very good deck) or you will find a way to trade what you open for what you need.

Most of us understand the need for big dealers like Star City Games. They provide the ability for you to sell them cards at their buy prices, and buy what you need at their sell prices. Everyone who trades cards in this way knows that the large retailer is going to buy for less than half of what they are going to sell at, and we're ok with this. On MTGO, the 'bots behave the same way.

Another option is to trade around with others who have small personal collections. The upside is that if you can complete a trade, you will probably get a very fair deal going both ways. Of course, this system breaks down if they have personal attachment to the card you want, or too many people in your store are building the same deck and there just aren't enough of the same 3 sweet cards to go around.

This is where the Pack to Power style traders come in. They don't have any emotional attachment to their cards. They aren't trying to build the hottest deck with the stock of their binder. All they need is a marginal profit coming their way - less than the major dealers - and they're usually up front about this fact.

Without traders like this, the secondary market for Magic just becomes the huge dealers making huge profits. In effect, the P2P guys are a little like the small business owners of Magic - they need to hustle just as much as the big boys to understand pricing and trends, but they aren't getting to buy and sell thousands of dollars of cards each day.

As a trader who usually trades for value, I feel that I provide an important niche in the market of my local store. I usually have the cards you need. I am willing to part with all the tournament staples. I have tons of sweet EDH rares for less than the $4-$5 they'll cost you online. I trade for hot cards at large events, and bring them back to my area. And losing a couple bucks trading with me is going to provide you MUCH greater EV than trading in your cards to a store or dealer. And a MUCH MUCH better deal than selling your cards on eBay and buying mine once you factor in fees, time, etc.

I don't see the problem with having a vibrant trading community like this.

As a MTGO player who just by Raddman at Mon, 10/18/2010 - 13:10
Raddman's picture

As a MTGO player who just started playing pants magic 3 months ago, I can surely relate to this article.
First of all, trading on mtgo is non-existant. People online trade value for value and the ease of getting any staple you need makes trading practically a waste of time.

After starting pants magic I realized this trading this was as important to me as playing. It has almost become a mini-hobby, a game inside the game.

Just this friday alone I made the following trades.

Elspeth + Darkslick + Summoning Trap + Inquisition of Kozilek x2 for his Koth. If you use capefeargames prices I ended up around 5 dollars to the good.

Memorcide for his verdant catacombs. Clearly gained here

Lotus cobra for his 4x Eldrazi Temple and Eye of Ugin - might of lost some here.

Frost Titan + Mindbreak Trap for his All is Dust and Awakening Zone. Again in my favor

A few weeks ago I traded 3 crap black rares for one Foil Scalding Tarn. I even told the player it was heavily in my favor. He said he didn't care, would never use the card. I still felt bad so I threw in Gaea's Revenge, but still ended up +20.

I am sure everyone has stories like this, but the truth is never once did I lie in these trades. If they want a certain card of mine I ask what they value it at, if I agree then I proceed to find cards equal to, if I don't agree I tell them my value and we go from there.

It is way to hard to put values on cards for paper when players will always have the "want" factor. A few weeks ago I had another player who was dying to have my 3x Traumatize. I know that the deck won't be very competitive, but I told him what I was interested in his binder, told him the price variance and we completed the trade. I made out probably + $15, but in the end he didn't care, he simply had to have those cards to finish his deck. I didn't cheat him, was completely honest about values.

Not every player at local FNMs are trying to make metgame competitive decks. Some take great pride in using their own deck ideas with cards that hold little value. Just because they are willing to part with tournament staple cards in order to build their rogue decks doesn't make me a terrible trade person. It makes me a smart investor, looking to capitalize on the wants and needs of others. People in the business world have been exploting the wants and needs of consumers for centuries. I just happen to be on the profitable end of that business transaction.

I agree that there is a huge by Paul Leicht at Mon, 10/18/2010 - 13:54
Paul Leicht's picture

I agree that there is a huge difference between online trading and offline trading and it is quite lamentable. I traded up to half a beta set over the course of a few years using mainly standard staples. In the end my collection sold for $500 at a fairly large discount to the buyer and I did not feel bad about that at all because I needed the money and it was roughly about 3x what I'd spent (not including the many hours trading). I also did not feel particularly bad about trading cursed scrolls away for beta duals. (The duals were played so the value was roughly equal at the time.) I think where people feel ripped off online is where party a goes in knowing not only the various price margins for a card but trying to capitalize on someone else lack of familiar to trick them into giving up value. Whether this is wrong or not is a question of personal ethics as Pete says (sort of) but I would not do this.

The thing that people forget is that while Magic is a game for some, for others it is a living. And people will do much to protect their income. Personal ethics tend to not enter into it in such situations. Then it becomes a question of 'why shouldn't I use my vast knowledge to exploit the system and those who use it? It's not like I am the only one who can and will.' I guess everyone has a different line to draw.

Quick question: you are by one million words at Mon, 10/18/2010 - 15:28
one million words's picture

Quick question: you are buying some donuts at a grocery store. The clerk bags them and writes the price - $2.35 - on the bag. Walking away, you realize that the actual total should be $2.55. Do you go back hand have them correct it?

Happened to me yesterday. I went back and had the lady change the price.

My moral compass may not be typical. There were plenty of excuses / justifiations for doing nothing. Had I taken the bag to the register and said nothing, there was no way I could get in trouble, and almost no chance anyone (besides me) would ever realize what happened. Yes, it wasn't my fault: it was the bakery lady's mistake. The store probably does a couple million dollars a year in business: twenty cents was not going to break them. etc. etc. All excuses aside - the store was entitled to the $0.20, and it was my moral responsibility to pay them.

Not everyone sees morality the same way I do.

I try to be as morally correct as I can, within my own limits. Yes, a cow died to become my dinner. I've spent a lot of time in close proximity to cows, and I have no qualms about that. Others do. YMMV. However, as to the topic of this article - I don't view trading as unethical. I have a trade binder. However, I will only trade if I feel that I am not taking advantage of the person I'm trading with. It's not enough that he or she is happy with the trade. I'm too good with words. I know I can con people, if I try. I only do that nowadays in role-playing games, and games like Diplomacy. In real life, I need the trade to be balanced, or slightly in their favor.

Not everyone sees the world the same way.

Several people have commented about their trade experiences. I'd be glad to trade with Raddman. I'd be a lot more careful trading with some of the others. It appears that they will be more than willing to take advantage of my mistakes, so I have to make sure I don't make any. Actually, as many people have mentioned, caveat emptor (buyer beware, for those without classics training) - so this buyer simply does not trade with any of the small traders. I amy occassionally trade with other players at my local store, but most of my serious trading consists of taking a box with everything I want to get rid of to a major dealer, like Pastimes.com (paper) or MTGOTradersBuyBot online, and simply selling it to them. I may not get top dollarm but I don't get ripped off, and I don't have to waste a lot of time.

Could I make more working harder at trading? Well, that's next week's article.

I am not sure the donut by Raddman at Tue, 10/19/2010 - 10:06
Raddman's picture

I am not sure the donut reference applies in this situation. Products at grocery stores often have predetermined prices, people don't in their trade binders.

For instance, you see a package of white powdered donuts for $2.55, but you also see chocolate covered donuts priced at $2.55. You wouldn't go to the counter and tell them you are willing to pay $3.55 for the chocolate covered donuts because you "really" need them.

That is exactly what players do in trades. They often times willingly take losses to get the exact card they need to complete said deck. One of the reason is because they lack delayed gratification. They need the card now and are willing to do whatever it takes to get it. With a little patience they could easily buy it at market price and not take a loss. Also paper trading is far more difficult because it might involve driving.

You simply can't put an exact price tag on cards like you can donuts because the personal value is higher to different people.

And to be honest, no offense to Mr. Medina, although I found his journey and articles enjoying to read, the truth is in the end he probably lost money.

It took him like 4 months approx to complete the journey, who knows how many hours only to really make $360. He could of just as easily got a part time job, made 5 or 10 times that and bought several pieces of power. If we really want a lesson in economics, I think getting a job might be a better discussion to start with 80)

Losing FTW by jmedina at Tue, 10/19/2010 - 12:48
jmedina's picture

@Raddman

I did lose money, via traveling and using time that I could have actually been trading from my personal collection to trade for Pack to Power. Not to mention all the time it took to actually assemble each weeks adventure into an article.

I did this knowingly, because I felt like it was something the magic community needed to see. I'm not a value monger like some may think, if I was I would have just kept all my trade advice to myself and use my time making money.

I know what it takes to be a successful trader and I will tell anyone who asks. Some people don't like what that looks like, but it's the truth. I didn't create capitalism. lol

Thanks for following me on my adventure BTW.

Unethical trades? by Ikoma_Aze at Mon, 10/18/2010 - 16:18
Ikoma_Aze's picture

Hi

Just curious about whether you think the following situations are unethical. Clearly I think they are not.

1) Bot A is selling a card for 10. Bot B is buying the card for 12. Is it unethical to buy from A and sell to B. No value is being added, in terms of your descriptions. But those Bot owners are people. Do you think this is immoral?
(Though they don't come up often, personally, I really enjoy finding and profitting from such arbitrage opportunities.)

2) What if A and B are actually people? What if they both have ad's up in the classifieds?

3) You acknowldge that you have no problem with people speculating on cards that may gain value due to the metagame, and decks they might be played in.
You say "It only becomes problematic when it is not a gamble. If you know something, rather than predict something, you are no longer speculating.".

This seems like a huge grey area to me. For example if I have the ability and time to read Japanese tournament reports, and pick up metagme shifts, (that may or may not actually materialise into pricce difference) do I KNOW something? What if it is SCG Open tournament results? What if it is Pro Tour top 8 decks?
Am I required to point this info out to my trade partner, to make it ethical?
Is that me knowing rather than speculating, if they haven't seen the same websites?

Like 1, this seems to me like I am putting in work/time/effort to make better trading decisions, and exploit inefficient markets... but it seems you think this is unethical? Should a person who does this extra work, not be rewarded for it, but have to disclose it to their trade partner?

All of these, as Plejades suggested, come from my willingness to use my time/effort to find advantageous opportunities, thereby adding value for myself. I don't feel I'm ripping people off, but I am always trying to look for value in any trade I do.

I won't lie about values, especially if asked. I will tell them that it's in my favour, and that I am trying to trade up and often even say they might find a better deal elsewhere!

If they don't ask about prices, we both confirm, and I get a good deal, that's good enough for me. They were happy with the value they got for the card they got, regardless of the website price.

2 things 1) Public perception by Paul Leicht at Mon, 10/18/2010 - 17:28
Paul Leicht's picture

2 things
1) Public perception of moral standards and personal perception of ethical obligations are very different things. Ask 10 people their opinions you will get 10 answers (or maybe 20 if you ask the right people.) Ask people their observations of customary social morals though and most people within a particular society will answer similarly.

2) Just because you can personally justify something to yourself by saying that you worked for it, therefore you have a right to it, does not make it so. That is called rationalization and it is something honest and dishonest people do alike. The difference between the two is the honest person will acknowledge that the other parties may not agree. My point is thieves work hard for their living the same as business owners. (Even if they think they won't have to when they get started.)

Point 1 is merely a reminder as I think the two things are getting a little blurry here. Point 2 is a rebuttal of your statement that you are entitled to gain your advantage morally by the work you put into getting it. Ethically speaking that may be true for you but if you rip someone off (with a huge difference in trade) most people will see it as a rip off if told about it. They might be OK with you ripping people or not but that is what it will seem like.

I do like the fact that you will tell people if asked that you are trading up/trading for value and that it is in your favor. That speaks to your honesty. I also agree that if a person is happy with their trade and you've been forthright then as long as you are OK with it ethically you are fine morally too.

On the other hand Ive experienced a dozen or so tricks that people pull in trades to pressure their partner to give up value in a decidedly unethical manner. In some cases I've called them on it, started a brew and then blocked them as things wound down. Other times I've played their game but gave them no quarter. Almost never has this resulted in any trade whatsoever. One guy even called me a tough trader after such a situation. *shrugs* so be it.

All in all though, knowing that people are only out for themselves and to make a quick buck has made online trading with humans largely untenable. At least as far as I am concerned. I sometimes will accept a trade request with a "Newb" but I am wary even there and will quickly end a trade I think is not on the up and up.

I'm glad someone brought up by Felorin at Mon, 10/18/2010 - 18:30
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I'm glad someone brought up (if indirectly) the important notion that a given card does not have the same value to all people. I never heard the term "Pareto Efficiency" before, I learned something today.

If the current market prices are $1.00 for Coughing Dragon, and 70 cents for Sneezing Vampire, some might say trading them one for one is an "unfair trade". But let's say I opened the Vampire, and I don't care for it at all. To me, the Vampire is worth 25 or 50 cents at most, and I know I'll never play it or look at it and go "wow, cool art" or anything. Its value lies mostly in the fact that I know it's a rare and I can trade it for something I actually like. But Coughing Dragon is so cool in my mind I feel like it's worth 2-4 bucks worth of fun easy. If I paid full retail for a booster and the only card in it I wanted was the Coughing Dragon, I'd be happy I got it and feel happy with my purchase.

Meanwhile one of my buddies who's into the whole vampire thing doesn't think much of Coughing Dragon, maybe 75 cents tops, but Sneezing Vampire is AWESOME and he'd happily trade away three bucks worth of cards to get one. He doesn't buy from card dealers, he's just not into that - buying packs and trading with buddies are the only two ways he adds to his collection. Of course the booster he just picked up at the comic shop today only has a Coughing Dragon.

If I trade him my vampire for his dragon, are the market values even relevant? Especially for someone like my friend who keeps his more casual participation in his hobby totally outside the main parts of that market? Or is the fact that we both traded a card we didn't want much for a card we value way higher indicative of this being a "win-win" trade for us?

That said, I would also say any trade that is only "off" from being equal market value by 20 to 30 percent I think is a non-issue, if both traders either know, or suspect, that "this trade isn't an exact match but hopefully somewhere in the ballpark of the same value". Which is how a lot of trades are done.

As for this quote:

"If you don't know the prices of your own cards, then don't trade them."

...or you can have a community with a significant number of traders who help you out, the way I do at the two shops I play and trade at. I'm not the only one, either. If a kid tries to trade me one-for-one and their rare is higher priced, I'll tell them to take some more stuff. A number of our local players will answer questions for two traders on what a card is worth, or look it up for them on a smartphone.

If players who aren't "into" the hobby enough to do actual work to make trading fair learn that there are people they can trust and trade with... They have more fun, and the community thrives and grows. If that's not the case and their local game store is a sharkpit... The community shrinks and is generally less friendly and trusting and laid back.

That said, I think people often, often will want to make "unequal" trades even when they know the prices, because they don't care that match about how much "better" they could optimize their results if they spent hours wheeling and dealing, ebaying, watching dealer price lists, etc. And two bucks isn't a big deal to them. They want that $3 rare for their deck, and they'd rather have it NOW so they can use it tonight. Somebody else is happy to give them what they want for a $5 rare they don't like and don't play - they're fine with giving up two dollars of "value" that they would never do anything to take advantage anyway. They don't even want to pore through the other guy's three binders and try to find a buck or two of other cards that they might use someday. They just want that Polkadotted Wombat, and they'd just as soon get it in a 3 minute trade rather than a 20 minute trading session and use the extra 17 minutes hanging out and chatting with their best buddy. Because their time has value to them too.

I agree that lying or deceiving by omission are ethically questionable at best, and downright exploitation at worst. But many times people know they're making uneven trades and are fine with it, I've often done that myself. Sometimes it's a really close friend and I place some value on knowing they got a card they really like & will have a lot of fun with it, and that more than makes up the extra value for me. I've come out ahead on trades too, but always knew the other person was happy and felt they got good value from the exchange, and I've never been dishonest with anyone, so I don't feel bad about any of those trades either.

One of my first trades on MTGO, the guy threw in a bunch of extra stuff even though I would have taken a lot less, he wanted to help me out because I was new. Also he gave me a bunch of his extra unneeded commons and uncommons afterward, so I could have more stuff to build decks out of. It may be rare on MTGO, but it can happen even there.

two cents by blau at Mon, 10/18/2010 - 18:53
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Haven't finished reading ALL the commments, but I've seen a few that seem to make the same point I have. I totally disagree with your assessment that it is somehow "ethical" of MTGOtraders to MASSIVLY undervalue cards on their buybot, but for if a person was to do it, then that would be "wrong." I guess that hits too close to home for me. I'm not a huge fan of the process of going to mtgotraders buybot and getting my rares valued at 0.30 and then watching them sell them for 5.60. THAT totally seems unethical. Although I shouldn't really talk because buybots are how I get my cards. As you mentioned there are plenty of drafters looking to unload cards, many of whom are close friends of mine. I ask them to go see what a boybot, like MTGOtraders, would BUY, not SELL, their cards for. So they will come back and say, "They'll buy them for 4.50" and I give them 6 to make sure I keep them coming back. I get cards cheap, they get the tix they want. By yourstands, I'm being unethical. I disagree entirely. I'm just doing what the big sellers would do. But I guess since I'm an individual, and not a huge store, I guess I'm the bad guy right?

it is ethical if people are by one million words at Mon, 10/18/2010 - 19:57
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it is ethical if people are up front about it. MTGOTraders say up front that they buy at wholesale, and sell at retail. They have to make more profit to maintain a full store and massive inventory. The tradeoff is that they almost always have whatever you need. Again, a discount or mismatch between buy and sell, or a mismatch between values in a trade is not unethical - it is SAYING THAT THE TRADE IS SOMETHING IT IS NOT is the unethical part.

A dealer who says "I can/will pay $x for that" = fine. A trader saying "I'll give you this for it. I'm coming out slightly ahead, but I don't need it that badly." - also okay. "This is about even" when it is not - that's unethical.

I have never seen that sort by ShardFenix at Tue, 10/19/2010 - 10:54
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I have never seen that sort of discrepancy in anything I have ever used the buybot for.

Five fireballs, sir! The by MMogg at Mon, 10/18/2010 - 19:33
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5

Five fireballs, sir!

The value of an article like this is not so much the absolute substance; rather it is the ability to provoke discussion on a controversial issue. Had this article not been written, I would never have read Medina's articles or as Felorin says, learned about Pareto Efficiency.

Another important aspect of ethical debate is that it challenges each reader to examine themselves and their actions and determine if they are ethical or not. Not everyone will and not everyone cares, but at least the challenge has been made.

As someone who is not a hardcore capitalist, I think ethics should play a central role in economic exchanges and every other facet of human interaction. A lot of the discussion on ethics can be rebutted by logic and reason, but I don't want to live in a world wholly regimented by logic and reason. Doing what is right is usually more difficult, or takes more energy, than doing what is wrong (such as going back and getting the person to change the price on the donuts), which is why most people don't follow strict moral or ethical codes.

That said, once you are an adult, I think you have an ethic of responsibility. I agree with those who say it is the responsibility of the traders (both) to know the value of their own cards. Although I don't like sharks, I also don't care for those who are irresponsible enough to let the responsibility of knowledge fall onto someone else's lap. If you just cracked a Koth at your local brick and mortar store, and you trade it immediately to a shark, then yes, you are irresponsible. Instead of waiting, going home, and checking the price of your mythic, your need for instant gratification means you either a) asked someone else the value (thereby shifting responsibility to someone else) or b) didn't care enough and trusted your own judgement. Either way, the irresponsible trader also is, to me, a little "unethical" (lazy or wants instant gratification).

One of the local stores I by Windcoarse at Mon, 10/18/2010 - 19:58
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One of the local stores I used to go to was a shark infested pit when it came to trades. Basically people wouldn't trade unless they saw at least a 20-30% value on their trades, if they weren't getting over it just wasn't happening. They'd race to shark all the new and especially the younger players. New players would get a harsh lesson on the nature of humanity, and young players pretty much didn't have any chance at all and just got hammered. I remembered evening up a trade one time for a guy who was trading me 4 figures, and I still came ahead a little bit(likely less than 5-10% but he knew). I had traded him unopened packs for the figures at roughly the same value they were being moved for in the store, but it didn't really come out even so I threw in some stuff I knew he was looking for. Afterwards one of my friends just shook his head and couldn't figure out why I would have done that when the trade was looking so good for me(even though technically, it still ended very slightly better for me). Still, I was open to further trades with that guy and I certaintly wouldn't have been if he thought I deceived him.

The sharks are still sharking people as far as I know, but the sharks don't have much time to get the fresh blood before everyone warns them not to trade with them. Unfortunately, modo can't have that natural set of checks and balances and really needs some changes made to the interface. I do think some sort of rating system isn't necessarily a bad idea if implemented properly.

Agree with Pete Jahn by Haarek at Mon, 10/18/2010 - 21:27
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Since Magic also is played by people under legal-age (in which case they are not expected to fully grasp aspects of economics), and people above legal-age who don't expect to be taken advantage of (there are no formal warnings from Wizards on 2nd hand trading when it comes to the economical aspect), Pete Jahn is RIGHT.

Fair traders in MtgO and PaperMarket are good for the whole community, especially the LARGE dealers - since they show what fair trades are like - at any given time.

At the end of a lot of unbalanced trades in a persons favor there is the converting of cards to money, which also is illegal by law when not paying tax.

The play-part of Magic involves out-smarting your opponent, which sadly carries over to some players/traders also wanting to out-smart others in trades. It acts as a soothing of their conscience.
"I have played Magic for 10 years and have put alot of money into Wizards pockets, and such DESERVE to hustle some newer players in trades."

Overseas calls by JamesEduard at Mon, 10/18/2010 - 21:57
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Well this is a very good tips to share in here. actually the only big thing that comes up in this topic is that how you can approve your income profits.
One this in here is that you really had a great time doing it in a good manner or in a good thing that you may be able to increase your money in an instant.
Pack to Power - or How to Steal a Thousand Dollars - is actually is not actually stealing money, your actual definition or lets say direct explanations is that on how you can easily exert efforts and be able to make money on the spot.

Overseas calls

Every trade is stealing! by Jyalt at Mon, 10/18/2010 - 23:34
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Because traders are moving cards around, they are 'stealing' packs from wizards of the coast. Let's take your title to it's final conclusion. Every trade made means one less pack gets opened. Oh and YMMV.

There are three types of traders online:

A1.) Bots -- only in it for money
B2.) People who rip off people -- essentially intelligent bots
C3.) People who just want card X -- either they know how much X is worth or they don't

You think A1 is fine because their margins are lower than B2, and that 'adds value' to the community. Some A1's like this website actually do add value, (a smart marketing loss-leader) but most don't. A1's are generally polite and forthcoming because it's good business, and in a vacuum I will deal with PureMTGO above any other bot since they DO add value to the community. More B2's are bombers -- they go rude to try and get better trades.

C3's (See these!) only want what they want, and your position is it's fine for a C3 to deal with bots or other C3's, but not B2's. B2's will definitely rip C3's the hardest, but that's because C3's DON'T CARE -- they only want what they want.

Your conclusion is A1 is better than B2 because B2's are simply better at brokering deals. You are fine with any trades between C3's. Essentially you hating on B2's for being 'good' bots in that they put in more personal (human) time than automated systems for better results. I find this absurd. C3's are willing to trade money for time (card availability), and this article essentially proposes a kind of magical communism where every trade is within a certain bound of subjective 'fairness', a metric that isn't even defined, nor can it be defined, since part of it involves unknown future trendlines.

That said, I personally only deal with A1's on MTGO these days. B2 bombers annoy me, and it's not time-effective find C3's (who generally only hit up A1's too) because of how badly the marketplace is structured.

values of cards aren't fixed by Stu Benedict at Tue, 10/19/2010 - 00:35
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values of cards aren't fixed ... it would be impossible to have a trade hold equal over any amount of time period ... you could be up $10 today and down $20 in the trade a year from now ...

why sweat the small stuff?

hmm i'd like to say it is an by NO_Peace at Tue, 10/19/2010 - 02:52
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hmm i'd like to say it is an interesting debate, but it isn't. The article itself is provocative, the fanboi's of the process are one eyed. Where does that leave us?

Do we have a responsibility to other people? yes. Foolish, childish, selfish if you rip someone off.

For that reason there is no chance I would ever trade with a human. I have enough good mates that if I want a card, I am generally given it, or it is lent to me with the option to return at some point, and the same goes for them. This is not paper, sadly, as above trading in paper is a hobby in itself. Online? no.

Trade your way to $1,000... geez. Just get a job, and stop ripping kids off.

Fine read and a really great by greyes3 at Tue, 10/19/2010 - 03:19
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Fine read and a really great topic for discussion here.

One quick point if I may...

I don't for a second accept this idea that it's OK for bot chains to buy singles at lower prices and turn around and sell them for higher prices. I don't see where the added value is. "Mass inventory" is not an acceptable argument to me because there are enough players online drafting and cracking packs, that I believe cards are reasonably easy to find. We're not driving hundreds of miles to find cards as you alluded to. There are two "distribution centers" online if you will, and those are the WotC store and the classified section, which everyone has equal access to. The bottom line is these bot chains are exploiting players in trades too. Competition drives their revenue, and they are feeding off the negligence of players. This is not ethical to me.

Hopefully v4 will have a better classified section with some kind of buying/selling bot or function that everyone can freely use, without having to jump through any hoops for.

I would like to add that a by MMogg at Tue, 10/19/2010 - 04:33
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I would like to add that a lot of those bots that sell higher and buy lower than others often advertise "best" prices, thereby compounding the unethical behaviour with deception.

Value is relative! by Amar at Tue, 10/19/2010 - 12:08
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3

This line of thinking, reductio ad absurdum, would have to conclude that any middleman is being unethical. And there certainly are people who subscribe to that view, but I put no stock in it.

The flaw is in treating any item as if it has a single value. To use your donuts example from the comments above, what's the value of those donuts you purchased? The temptation is to say $2.55. But that's not the value, it's merely the equilibrium price. If the value was $2.55, then you wouldn't care if you bought them or not and the shop wouldn't care if they sold them or not. But that's clearly not true. You value the donuts more than $2.55, or you wouldn't have bothered to go there. And they value the donuts less than $2.55, or they wouldn't have bothered to sell them. Such is always the case: for the buyer, item value >= price. For the seller, item value <= price. Both gain from the exchange, both walk away happy they profited from it.

This is why Capitalism works. (And somewhat ironically, it's the reason Sales Tax is possible. If the donuts were worth exactly $2.55, no one would buy them because once you add the tax they're not worth it.)

So this completely holds true in card trading. If I have a Jace but want to build Valakut Ramp and need two Titans, and you have Titans but need a Jace, then we both benefit from the exchange regardless of what other people say they think each is "worth". The fact is that other people aren't there offering the exchange and their theoretical "price" is worthless compared to the actual utility of the trade in front of me.

Now when you involve deceit it's an easy case, but also an unrelated one. Yes it's wrong to lie about what a dual land is worth in order to take it in trade. But wouldn't it also be wrong to lie just because you think it's funny to confuse him? Harm is still harm whether the perpetrator benefits from it or not. So if you want to reference lying to criticize some documented articles that's fine, but don't blame the trading.

I like your insight here by Xaoslegend at Tue, 10/19/2010 - 21:49
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I like your insight here Amar.

Personally I feel that trading fairly is the product of being honest about what the cards are of value of to you or not making any claim at all about whether the trade is "fair" or not. Obviously if you know that a card sells for more to a bot than you are giving them for it you know the trade is "not fair", at least online where they don't have to drive anywhere or anything to get the sale price.

There is a fuzzy area here though, if you take a new player or someone ignorant of prices for cards in a trade knowing that you're totally owning them based on their ignorance I think that's pretty messed up. If you get 10-20% out of any trade I don't think that's that big a deal, you could easily be down on the trade the next day based on price changes. It's a matter of personal morality as to how far you're comfortable with this or not uncomfortable with any level on way or the other. (If you're not uncomfortable with any level of owning someone IMO you may be what used to be referred to in medicine as a sociopath, someone who does not care about others whatsoever and is to be feared by all of humanity)

Personally I prefer to just trade based on mtgotraders prices down to less than 5% difference so long as the cards are in stock and seem reasonably priced, I do this because I don't pay attention to price change trends, format legality changes (other than Heirloom), reprinting schedules ect, and I'm just not a frequent trader. Also I figure I can alleviate any suspicion between me and the other trader by doing this and allow for an ongoing and future playing, trading, social relationship.

my twenty cents,

X-

You are incorrect in assuming by greyes3 at Sun, 10/24/2010 - 20:53
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You are incorrect in assuming this line of thinking leads to any middleman being unethical; just most of them. There are situations where goods are only sold only in bulk/large quantities, thus making it unreasonable for typical consumers to buy them directly.

I don't understand what you're getting at in saying there is a flaw in assuming any item has a single value. Yes, everyone values everything differently but that is irrelevant in terms of company pricing. A company can only put one value an item at a time hence, pricing. OK, it is not irrelevant if their goal is to actually sell merchandise...beside the point.

At a single given point in time for a company, an item can have only one value. Yes, overtime these values change based on a number of things, but again that is beside the point. If you go to Walmart and look at the price of anything, there is typically one price tag on any given item. (Sometimes more if you want to count things like buy 2 for 1 deals or what have you...) Sure, there could theoretically be scenarios where Walmart decides to put 2 price tags on their merchandise and let consumers pick the amount they want to pay, but for now I think it's safe to say that this isn't going to happen anytime soon.

In your example you used donuts as an illustration, so I'll do the same to make my point. The grocery store selling donuts for $2.55 is going to be a reasonable purchase for some people, for others it might not. Some people really love donuts so they don't mind spending the extra money. Some people may be strapped for cash, so they decide if they really want donuts, they'll need to shop elsewhere for cheaper donuts. Hence, value for one person is not the same as another person, check. It makes sense to assume the people with less money will eventually want to find the same donuts for the cheapest possible price. For fun, say there is a donut farm somewhere out there selling these cheaper donuts. The poorer people start going to this donut farm buying donuts at $2.00 at bag, and in turn start to make some of the richer people buying them at $2.55 a bag, a little peeved. So what do the richer people do? They start going to the donut farm too. Eventually the grocery store realizes what's happening, and they are faced with a few options if they want to stay in business. Let's for kicks say the grocery store was actually buying the exact same donuts they were selling at $2.55, from the donuts farm for $2.00 also. They have to get them somewhere right? Can someone please explain to me how the grocery store is not being unethical in selling donuts for $2.55 when they are clearly only worth $2.00?

Yes, some people are going to buy donuts at the $2.55 price regardless, because they don't mind throwing away their money or whatever. This is what I alluded to at the end of my original post saying businesses feed off of consumer negligence. Again, in my opinion, unethical.

If I need Forests for that same Titan Valakut ramp deck and you need the Bayous I have for your Legacy deck, just because making the trade would benefit both parties, does that mean I should not value what other people would offer in this situation?

There is more than one reason why Sales Tax is possible. I for one don't mind paying to help build the roads I drive on.

Donut farm ftw!! :D by Paul Leicht at Sun, 10/24/2010 - 21:53
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Donut farm ftw!! :D