<story><title>Money for Nothing</title><url>http://www.dansdata.com/gz146.htm </url></story><parent_chain></parent_chain><comment><author>llimllib</author><text>I actually used to write book arbitrage software, and this person has managed to completely misunderstand it.&lt;p&gt;I&amp;#x27;m not arguing here for its societal value, just that dan appears to have misunderstood some fundamental bits about how it works.&lt;p&gt;&amp;gt; Robot 1 offers Book A for $10. It probably doesn&amp;#x27;t have it in stock, but it knows where it can buy it for, say, $9, drop-ship it to the customer without ever seeing the acutal product, and make a buck on the arbitrage. Robot 2 notices this and lists the same book for $11, hoping to do the same thing. Robot 1 notices Robot 2&amp;#x27;s listing, doesn&amp;#x27;t know or care that Robot 2 is another arbitrage trader, and reprices its listing for the book to $12. Robot 2 notices this and goes to $13, and away we go.&lt;p&gt;This makes no sense; the fundamental rule of amazon bots is that consumers buying used books almost always buy the &lt;i&gt;lowest-priced&lt;/i&gt; used book available. So the bot war would send the price &lt;i&gt;down&lt;/i&gt;, not up.&lt;p&gt;Why in the world would bot 2 offer the book for $11? It would know that nobody would buy it when there was one already listed for $10.&lt;p&gt;The silly-high-priced books that I saw when I was working for the book company were rare long-tail books. One of the discoveries that many people have made is that for rare books, whether or not you understand what the heck it is, some % of them will get bought even if they&amp;#x27;re listed for &lt;i&gt;silly&lt;/i&gt; high prices. Enough people will pay thousands of dollars (not an exaggeration) for a used copy of a book that they can&amp;#x27;t find elsewhere that stocking the long tail of books can in fact be very valuable.&lt;p&gt;That means that, when you find lots of rare books, your incentive is to throw out some crazy-high price for each, because some % of them will, in fact, get paid, making the whole enterprise worthwhile.&lt;p&gt;edit: Arbitrage on the same market Does Not Work, in my experience, and to just claim that it does with no evidence doesn&amp;#x27;t make it any more likely to do so.</text></comment>
<story><title>Money for Nothing</title><url>http://www.dansdata.com/gz146.htm </url></story><parent_chain></parent_chain><comment><author>jonnathanson</author><text>Money laundering seems like an interesting explanation, but there are far better and less risky ways to launder money. Cash businesses, or even bitcoin are superior to &amp;quot;selling&amp;quot; an app that could be taken down at any time, that requires credit cards on file to purchase, and whose transactions Apple or a credit card company could freeze, reverse, or cancel at will.&lt;p&gt;It would be fairly trivial for Apple, in cooperation with a law enforcement agency, to source the transactions, map the patterns, and triangulate to likely points of origin. And it would probably arouse a lot of suspicion if an app of such obviously bullshit quality suddenly started raking in millions of dollars in sales -- thereby making sales of the app inefficient and risky as a laundry-integration method.&lt;p&gt;I suppose the whole thing relies on iTunes gift cards and credits, rather than credit cards, but why overcomplicate things beyond there? Buying and reselling gift cards at a moderate discount would launder your money just fine, while limiting your exposure to third-party risk.&lt;p&gt;Apropos of nothing, the dissection of the high-priced crapware reminded me of &amp;quot;I Am Rich,&amp;quot; the infamous and short-lived iOS app from 2008. It cost $999.99, and all it did was display a glowing red gem and a tagline on your screen. Evidently, at least eight to ten people bought a copy before Apple swung the ban hammer.</text></comment>