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eBay a Good Buy?
April 07, 2008

Buy eBay? Hmmm....

I read this morning that Merrill Lynch has changed their stock buying recommendation for eBay. Recently M-L had eBay listed as a neutral, but today they are recommending it as a good buy opportunity based on three factors.

The M-L cited factor which caught my attention involved eBay's new management and change in mentality. Hmmm. As a longtime eBay participent both in buying and selling, I have to say that the new management and the changes they have instituted have not been well received by or truely beneficial to the eBay community as a whole. Most seem dramatically slanted towards protecting innocent buyers from evil sellers, an attitude that has come on board with the advent of the new management.

In the past, eBay was always run as a community. Certainly they profited, but so did sellers and buyers enjoyed the benefit of a wide selection of goods and collectibles at reasonable prices. We all enjoyed a level playground and were treated equally. Sometimes a buyer didn't pay, sometimes a seller didn't describe an item fully. eBay did a reasonable job of mediation when it was needed and for smaller incidents users absorbed the losses and moved on.

Recently however, I get the feeling that the new eBay management thinks that dishonesty only originates from the pool of sellers, while all buyers are true-blue. This is not always the case. As I mentioned earlier, some buyers never send payment. Worse still, recently I have been hearing from some sellers that buyers are sometimes claiming they did not receive the item and getting a forced PayPal refund. In one specific instance this happened only three days after the close of the sale and payment was complete. For normal service, the USPS just does not work that fast. In the last year, I know of at least one seller who has lost hundreds of dollars to buyer fraud of this type. So I guess my point is, dishonesty on eBay is a two way street and sellers deserve as much protection as buyers.

For my part however, I would prefer it to be as it was in the beginning. A friendly community exchanging stuff. It was more fun in those days, before it became big business.

Which brings us back around to the Merrill Lynch buy recommendation. They are basing this on a percieved atmosphere of change at eBay. Well, there is no question about change in the air at eBay, buy I'm not likely to be buying, as I don't anticipate that these changes will build a better community or a stronger business in the long run.

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About the Author
Tom Michael has been Krause Publications primary market analyst on more than 80 world and United States coin catalogs produced over the last 20 years. He came to KP in 1987 with a bachelor of arts degree in history, a master of arts degree in economics and a history of coin collecting stretching back to the 1960s. He began collecting world coins as a child by asking friends and relatives to bring coins back from overseas trips, visiting flea markets and having his mother watch for foreign coins in her register at the local grocery store. Today he works with a dedicated base of over 200 contributors to provide accurate market values for the five-volume Standard Catalog of World Coins series, as well as many specialty catalogs, including Coins & Currency of the Middle East and the fifth edition of Unusual World Coins.

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