Originally Posted by Dave Mayer

Say you bid $50.00 for something. A nibbler bidder (a shill) comes along bidding in even $1 increments. When he bids $45.00, the auction price will hit $46.00. However, when the shill reaches a bid of $50.00, the auction price stays at $50.00, and you still stay as the high bidder, as there is a tie, and you posted this price first.

At this point, the shill knows you bid $50, and it is time to shut down.

This is that whenever I bid on an auction in advance, I go for a price of say $49.99. If there is a shill, he will nibble away and reach $50.00, and OMG!! now he's the leading bidder. The auction will close, the shill will "win" the auction, and invariably I will get a 'Second Chance Offer' for $48 or whatever. Because poor bidder #2 "could not complete the transaction" or some such BS. Ha. If shill bidder #2 hadn't been there in the first place, I probably would have won the item for $20.

I let the second chance offer expire. The seller reposts, and we do the same dance up to $50. But this time, he is smarter, and bids $49.99 as his final bid. Too bad: I bid $49.98, and he wins again.