Imagine you want to buy something, right?
You go to the shops in search of it. The owner of the shop says you can’t come in unless you ask him where everything is and what it costs. He says he won’t charge you and it seems like it might be easier this way as he seems to know lots about everything for sale inside. So he takes you in and shows you around, urging you to buy various things.
You end up asking to buy the thing you want – well, the nearest thing he can find for you – even though you’re a bit suspicious by now as you’re sure there must be something in it for him. He then tells you that the price tag on what you’re after is invisible. He can guess what you should pay for it, he tells you, but he can’t be certain. You make an offer but he then explains that the item doesn’t actually belong to him but to somebody else who’s using the shop to sell it. He says he’ll talk to them about what you’ve offered for it.
He gets back to you after a while and says that the offer is a great one but the seller wants to wait a bit in case somebody else offers more for it. Sure enough, somebody does – but the shopkeeper won’t tell you how much they’ve offered, only that you must offer more if you want to buy it. So you cautiously do. It then dawns on you that he and the seller know a lot more than you do about the transaction and that the mugs who are shelling out (that’s you and somebody else out there) are being used against each other to get as much as possible for the seller and the shopkeeper. But you haven’t much choice as there doesn’t seem to be anywhere else you buy these kind of things.
Imagine now what would happen if you wanted to sell something similar in the same shopping world.
You take what you’ve got down to the shop and ask the shop owner to sell it for you. He insists on a percentage fee of whatever it’s sold for. You agree ’cause you can’t see how anyone who wants your product will get to know about it unless they come to the shop. Eventually someone buys your thing and the shopkeeper takes his cut. You’re wondering what he did to earn this apart from putting it on the shelf and keeping the shop open but there you go, that’s life.
Now imagine you want to sell one thing and buy a different version of it, all at the same time.
The shopkeeper shows you some things you might consider buying for yourself and explains that the reason they’re so expensive is that lots of people want them. He urges you to make an offer for one you like (he still won’t tell you the price of anything). It’s a very expensive thing you’re buying – possibly the most expensive thing you’ve ever bought in your life – but he tells you you must hurry and make an offer before someone else comes into the shop and snaps it up. So you do.
The cycle of hidden offers being pitched against each other – you’re beginning to get the picture now, yes? – then begins, complicated this time by the fact that you can’t actually afford to buy the expensive thing you’re after unless you succeed in selling the one you’re trying to get rid of.
By now you’ve been to the shop dozens of times and beginning to wish you’d never started. But having put all this effort in, you persist and end up agreeing to an offer on what you’re selling and you get an offer accepted on what you’re buying (though it’s sadly more than you wanted to pay, largely because of the blind auction you had to go through to get your offer accepted).
The shopkeeper then tells you that everything’s fine except the people you’re selling to and buying from are also in the same position as you – needing to sell before they themselves can buy, so the whole transaction will now have to go on ice until everyone involved ( which may, of course, ultimately involve lots of other people further up and down the chain in both directions) are in a position to buy, sell or both. The only way this can happen, of course is by finding someone at either end of the chain who doesn’t need to do both things at once for some reason (such as having loads of money).
Eventually, the world becomes full of people wanting to buy and sell things but unable to do either. Unless, of course, somebody cracks and agrees to do just one part of the process, which then triggers a series of transactions – all of which the shopkeeper takes a cut from.
Have I convinced you yet that this doesn’t seem a very fair or efficient way of organizing commerce? Have you noticed that the only person to really benefit from the system being arranged in this way is the shopkeeper?
Take my advice then. Don’t ever try to buy or sell your house, especially through an estate agent. There must be a better way, if I could only think of it.
In the meantime, I’m off to murder mine.