The fish in the box (Part 2)

A Real Estate trick we are always ready
to pretend that we don't know…

Part 2

(to read part 1, click here)

Viorel sat down at his home. What had he bought? A dorada fish in a box… some photos and some measurements… "Isn't it too much for just a fish, which is already about 2 months old?" his wife Anca asked. "No, you don't know about investments" he replied. He searched and found some "super duper wow bow exclusive" intermediars… guys who had "relations to people with money and they just discuss with them for super offers". He gave the mandate to sell the fish to all them… So 5 persons started selling a fish in a box, using all kinds of arguments. They actually created an… auction, trying to raise the price as much as possible, in order to justify their fees. When one of them felt that another one would have an advantage to sell the fish, he even "invested" money, inviting the fish owner to expensive dinners, or even more… Viorel kept telling to his wife "you see? I was right"… In the end, he sold thedorada to Ovidiu. Ovidiu paid 895 Euro and became the new fish owner…

The time was appropriate for foreigners to enter into the game, as there were not too many locals willing to pay this sum of money. Ovidiu addressed to a famous multinational company. They had just opened a branch in Romania, offering as well "Extra Super Special Consulting – Brokerage of dorada fishes". They were serious… "We work only with institutional clients. Now we organize an event, to explain to them why an investment in a dorada fish can provide them a capital increase of even 7,5% per year, after taxes ofcourse. Comparing to their other alternatives, we evaluate this offer as an excellent one". This is why Mr Marcus was the new buyer, a foreign investor who bought the dorada fish, paying "only" 1.050 Euro ("we succeeded to convince the owner to reduce his price").

Mr Marcus was enjoying his coffee at a lovely expensive cafe, in Dorobanti area. He was reading in the newspaper his own interview, where he explained why he bought the fish. The article included also a market analysis by the multinational company, which predicted that "prices for dorada fishes may double or triple in the years to come, especially for the ones which are placed in a box and they are accompanied by photos and measurements.

Then the media discovered the first owner of the fish. "He bought for 50 Euro and now the price is 1.050. The price of the fish has climbed 21 times! Is it possible to climb so much in the future too? Can it rise to 21.000 Euro in few more months too? Did he earn 1.000 Euro by selling it?" (No, they didn't care to verify that all the "middle men" took part of the profits, it was a better to describe the first guy having sold with 1.000 Euro profit. Why the hell reality should destroy a nice story like this?).

Unfortunately the crisis started quite soon. And Mr Marcus needed to sell off some of his assets, in order to cover some bank debts. He started meeting all the top firms of the country, but none of them could find a client to pay the price he expected. After few weeks he was just asking for the price he paid, but not even this one was achievable…

Once someone found him a client, who initially showed interest… but when the discussion entered into money… the client asked Mr Marcus a simple question: "Why to pay all this money for an old fish, locked in a box? What is the use of this fish? I can not eat it, it is dangerous for health. What is the added value that it has? Why do you ask so much money?" The consultant of Mr Marcus interfered and tried to reply on his behalf: "Mister, you make a mistake. This is not a fish to eat. This is an investment. You buy it and you sell it to the next one. Soon the market will change again and you will be able to sell it for a very good profit, I personally guarantee this to you". Unfortunately the client was not convinced by the solid arguments of the "famous persuasive consultant"….

Some weeks later, Mr Marcus was walking in the center of the city, heading to his next meeting. At that moment, he recognized Ion. "This is the guy who initially bought the fish, I recognize his face from the newspapers. Maybe he would like to have it back, why not?" he thought and walked faster towards him…

– "Hello mister, aren't you Ion, the famous guy who initially bought and sold the fish?"
– "Yes, this is me. Who are you?"
– "I am Marcus, the last investor".
– "I was not an investor, I was just hungry and wanted to eat".
– "Ok, never mind. Would you like to buy this fish back?"
– "But it must be old now, not good to eat it anymore".
– "Yes, but it is exactly how you initially bought it and sold it to the next guy, in the same box, with photos and papers. I didn't open the box".
– "Ok, what is the price?"
– "I bought it for 1.050 Euro, plus expenses 1.100. If I sell it to you for 900 is ok?"
– "But I had paid for it 50 Euro and it was ready to be eaten. Why to buy it now and pay 900?"
– "But this is its price today".
– "No, this is how much you paid".
– "And what will you do? You can not find a cheaper dorada fish nowadays".
– "I will simply eat something else and wait for dorada to become again "attractive" for my wallet".
– "But it is an opportunity, it is 20% lower than the price I paid for it. All reports say…"
– "…opportunity was at the price that I bought it, maybe a little bit more. Now it is just an overpriced old fish".

Mr Marcus stopped the discussion. His arguments were useless towards this man's approach… And no report or valuation could help him now. Reality could not be ignored anymore…