Jerry CGI+

Still feverish after more than three weeks. Grumpy moods are hard to shake after all this garbage that my body is trying to fight off. Grrrr.
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This morning, I got my first real look at penny auctions. Wow, what a money making machine! They have an iPad 2 going into final minutes at SaveBig, and they have already made over $10K profit on it.
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Here’s how it works. A user registers, buys bids for $0.60 each (current price). 100 bids is $60. The user goes online, logs in, and starts hitting bid buttons that increment the price by $0.01. It’s easy enough to see how many bids have been made by counting the number of pennies on the bid. The real trick is that the last bid at closing time adds 20 seconds to the clock to allow for other bids. That extra time can extend into hours in a hot bid. That is the real money maker, because that is where 98% of the bids are made.
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Example: I’ll use the current bid on the expiring iPad 2 Wifi 16GB Black, which retails at Amazon for about $600 (lowest price). The current bid is $186.30. That is 18,630 bids, at $0.60 each. That is a total of $11,178.00 in bids. Subtract the $600, and that shows a profit of $10,578.00. Figure that the bandwidth/hosting cost is somewhere around $30 for all the bids, $25 for shipping, and throw in another $20 for overhead. Profit thus far is $10,500.
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What a scam!
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Oh, and the one that tickles me the most is the auctions on the bid cards. They currently have a 150 bid card ($90) that is going for $6.90. A good deal? They have already gleaned 690 bids on it, $414 thus far, on something that costs them nothing up front! That’s equivalent to printing money.
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Don’t get sucked up into this scam. The odds of breaking even on purchases, when calculating the bids into the final price, are dismal.
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All the way to the bank……