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Insider: MTG and Taxes, Part 1 – Hobby Tax

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Most of you are readers of QuietSpeculation.com because you plan to leverage your knowledge of the financial world of Magic: The Gathering in a profitable way. This can mean a couple of different things to different portions of our readership.

Some of you may operate a Local Gaming Store, some of you may travel to large events for trading and sell cards on eBay, others use trading to reduce the overall costs of playing Magic. Whichever you are, you need to know and be aware of what the government is expecting you to report as income.

I am not an accountant and I’m not a tax attorney. In short, and as an obligatory warning: don’t hesitate to work with a professional on your taxes.

What do you mean by Hobby Tax?

A Hobby, in the eyes of the IRS, is an activity that is carried out without the intention of making a profit. The idea behind income taxes for a hobby is set up to prevent tax shelter abuse. Since a hobby is undertaken without the intention of making a profit, you may not deduct any losses incurred during your non-profit hobby from your overall income at the end of the year. However, if you have incidental income (perhaps from speculating on a batch of cards) you must report it and are able to deduct any other expenses incurred from your hobby as a result. You simply cannot deduct more expenses than the income you report from that hobby.

Why does this matter?

It matters a lot. Hobby Income is not subject to Self Employment tax. Self employment tax is approximately 15% in the United States, and this is in addition to any income tax you owe. Your income as a hobby is still taxable, but is not subject to additional Self-employment tax. Because a hobbyist is only allowed deduct up to the amount he profits in expenses, there is no way to deduct your hobby expenditures from your net income that came from other sources like a typical employment. In order to be able to deduct all of your expenses, you must operate as a business and pay your Self Employment tax.

Imagine your year looked like this:

You traveled to some GP’s, you played all the local PTQ’s and did lots of trading and buy/sell on eBay. Perhaps your eBay gross income was $3,000 and your total expenses on the year were $4300. You could write off up to $3000 on your taxes, but could not get a tax benefit from losing money on the year. If it was the other way around, with a Gross Income of $4300 and expenses of $3000, you could deduct $3000 and pay income tax on the remaining $1300 without being held accountable for Self Employment tax.

How do I know if what I’m doing counts as a hobby?

The IRS doesn’t exactly lay out this as clearly as one would hope. But ,ultimately ,if you get audited by them, they use a number of factors to determine this. This link shows their checklist of things that the IRS will consider (excerpted here) to verify if an income is considered a hobby or a business.

  • Does the time and effort put into the activity indicate an intention to make a profit?
  • Do you depend on income from the activity?
  • If there are losses, are they due to circumstances beyond your control or did they occur in the start-up phase of the business?
  • Have you changed methods of operation to improve profitability?
  • Do you have the knowledge needed to carry on the activity as a successful business?
  • Have you made a profit in similar activities in the past?
  • Does the activity make a profit in some years?
  • Do you expect to make a profit in the future from the appreciation of assets used in the activity?

Further, “An activity is presumed for profit if it makes a profit in at least three of the last five tax years, including the current year.” So if you’ve been doing this long enough where the IRS can see a track record of you reporting income, they will consider you a business and you should report your income accordingly.

PayPal

If you conduct business on PayPal, you need to be aware of how they report that income to the IRS.
If you sell over $200,000 in Gross Sales and receive over 200 total payments, they are going to report all of your income to the IRS, they will notify you of this and request appropriate tax information from you.

International Laws

In many European countries, the law is similar in some ways but not others. You’ll want to be very careful to be aware of the laws in your own home country. Most countries where I was able to find documentation stated that you can only deduct the expenses incurred in the process of earning the hobby income, and you can deduct no more than the amount you earned.

In Closing

If you feel you fall into the Hobbyist category, it means you likely are spending more on your hobby than you are earning. And that's fine, that’s what a hobby is. The benefit of that is you can deduct your expenses from the gross income you’ve made along the way. If it’s clear you’re operating a business, or you’ve been successful a number of years in a row, be prepared to pay Self Employment tax. Find a professional who can help you itemize your deductions and get started.

Next week I’ll talk more about taxes from a Self Employment standpoint.

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Chad Havas

Chad has been with Quiet Speculation since January of 2011. He uses price speculation to cover all his costs to keep playing. Follow his journey from format to format and be prepared to make moves at the right times.

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CommanderCast S5E8 | The Derpmandercast Learning Discovery Experience

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Did you know CommanderCast has a sort of brother pocast, Off-Color Cast? Well, after this episode, you should have an idea of exactly what that our friends over at OCC are like. When I say Off-Color is like CommanderCast's brother, I mean it's your younger brother who spent some time in jail, was 'around' for a few years and came back to town asking you for money. But he's still awesome.

We talk about the title 'scrub', Heel decks, red cards that make the colour awesome despite the haters, and of course top it off with some bad cards we love.

Hit the button or play, or download the entire episode! The full show notes are here.

For more Wrexial-Approved stuff, hit up http://www.commandercast.com/

That Morbid Feeling

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Two weeks ago, I posted a somewhat introspective article ("Hitting the Wall") about how I go about looking for new deck ideas. As I explained in the article, I find it important to look for new avenues to explore in deck building so that each brew is unique.

While coming up with examples for that article, I realized I have a tendency to avoid building three-color decks, as well as decks centered in Black or Blue. My theme of choice usually is focused enough for one or two colors to get the job done, and when it isn't I find it hard to resist moving right on up to five colors. This tendency has left a huge gap in my Commander experience.

In light of this discovery, I've decided to spend the next few weeks focusing on three-color decks.

To start with, I wanted to look at a sweet concept that I had for a Jund deck with a Morbid theme and Kresh the Bloodbraided at the helm.

Getting Morbid

Morbid is a fun mechanic, and it's quite easy to trigger in a format like Commander where creatures are constantly dying. Jund provides the ideal color combination for the dual task of killing creatures and benefiting from the resulting bloodbath. In addition to slaughtering monsters and reveling in their deaths, these colors give us access to an ample supply of reanimation effects.

There are two classes of Morbid cards that will form the backbone of our deck. Let's take a look:

Kresh in Training

  • Rockslide Elemental
  • Algae Gharial
  • Lumberknot
  • Scavenger Drake
  • Deathbringer Thoctar
  • Vulturous Zombie
  • Khabal Ghoul

Commander is typically a creature-centric format. Creatures attack and die, only to get recurred to do it all over again. If you've ever played a game with or against Kresh, you know how big he can get in just one turn cycle.

These guys may not get as big as Kresh, but they do a pretty good impression, and many bring bonus abilities to the party! They certainly do not rank with the most powerful cards you could be playing, but they have the potential to outclass even the biggest creatures on the table.

Besides, who doesn't love perpetually growing monsters?

Along with our next set of cards, these cards tie together and reinforce the morbid theme.

Morbid Engines

  • Reaper from the Abyss
  • Vicious Shadows
  • Falkenrath Noble
  • Salvaging Station
  • Butcher of Malakir
  • Furnace Celebration

As much fun as giant creatures are, they aren't always a reliable way to win a game. You also need ways to control the board and generate card advantage, which is where these guys come in.

Your best tools out of this lot are Reaper from the Abyss and Butcher of Malakir. Reaper for his part is an undervalued card in Commander, and especially powerful in a deck that has been built to activate morbid essentially at will.

The other centerpiece cards are Salvaging Station and Furnace Celebration. Salvaging Station is great for generating absurd amounts of card advantage, as well as recurring utility artifacts like Nihil Spellbomb. I've always been a huge fan of the Station, and I really encourage you to give it a shot!

Furnace Celebration is exciting not because it's particularly powerful, but because of how well it pairs with the following theme.

Bring on the Tokens!

Tokens play a huge role in Commander. They're one of the best ways to present a threat, since you can put a lot of power into play with just a few cards. It's also easy to turn tokens into "real" cards with things like Attrition and Skullclamp. Tokens are incredibly popular due to this power and versatility, and this deck is certainly not going to buck that trend!

In our quest to abuse token generation, we could go with the boring old standby of Plants, Squirrels and Elves. Instead, why not enlist a whole awesome suite of tentacled-spawny-things from Rise of the Eldrazi that will complement our Morbid theme?

  • Awakening Zone
  • Corpsehatch
  • Growth Spasm
  • Dread Drone
  • Kozilek's Predator
  • Emrakul's Hatcher
  • Deranged Hermit
  • Siege-Gang Commander
  • Goblin Marshal
  • Avenger of Zendikar
  • Grave Titan
  • Phyrexian Altar
  • Skullclamp

Alright, so they may not all be Eldrazi Spawn generators, but the few that aren't can be turned into pseudo-Spawn with Phyrexian Altar. The point is to produce a lot of tokens, then kill them to grow your creatures and generate value with Reaper from the Abyss and friends.

Aside from the various interactions enabled by tokens, don't overlook the ability of these cards to take over a game on their own. Every time one of these hits play you get a massive board presence which can be leveraged in any number of ways, and the deck is set up to make them hit play frequently.

The biggest question remaining is how to tie all these pieces together.

Start Your Engines

There are a wide variety of creature-based engines available to a Commander deck. Whether you're playing with Survival of the Fittest, Reveillark or Oversold Cemetery, creatures are the easiest card type in the game to abuse and recur. When you're playing a creature-based deck, there are all kinds of ways to eke extra value out of your guys, and to ensure access to a particular effect when you need it.

For this particular deck, we want a combination of tutoring power and recursion. Preferably, we want to include things that interact well with Morbid rather than over-the-top powerful bombs.

Workin' on the Chain Gang

  • Birthing Pod
  • Wild Pair

These are two of my favorite Green cards in the format, mostly because they make you do some crazy things during deckbuilding to make sure you can chain creatures consistently.

Ideally, each creature you cast or Pod away can find any effect you might need at any time. It can be challenging to accomplish this while supporting other themes, but the cards provide enough upside that I think we can make it work.

The fact that Birthing Pod enables morbid, and that both Birthing Pod and Wild Pair allow you to ignore color requirements, is a big deal for this deck.

Both of these cards can easily run away with the game through card advantage and selection. I'm actually rather surprised that they don't see as much play as Survival of the Fittest.

Recurring Your Monsters

  • Mikaeus, the Unhallowed
  • Phyrexian Reclamation
  • Nim Deathmantle
  • Mimic Vat

Recursion is the other half of the value-creature engine. Once you've found your good creatures, you want to be use them over and over again, and I think these cards best enable you to do that in this deck.

You have a number of free sacrifice outlets that let you get a huge advantage out of Mikaeus, the Unhallowed. It's a shame that Eternal Witness is a human, but we can certainly make up for it with the rest of the recursion package.

First there's the obligatory Nim Deathmantle, which does let you go infinite with certain creatures plus Phyrexian Altar. Phyrexian Reclamation is one of my favorite permanent-based recursion engines because it has such a low activation cost and can be done at instant speed. This means that it doubles as protection against graveyard hate and lets you leave up mana to interact on other players' turns.

I wasn't sure whether Mimic Vat or Corpse Dance would be better as the last recursion spell, but eventually I decided that [card Mimic Vat]Mimic Vat's[/card] ability to steal other players' creatures gave it the edge. It's possible that playing both is correct, but only time will tell.

Filling in the Gaps

Once you've figured out the primary function of your deck, in this case tokens and Morbid shenanigans, you have to make sure that everything runs smoothly. It's great to have a strong theme, but without the right support you'll find it difficult to execute all the interesting interactions you've built into the deck.

In this case, the deck needs ways to answer noncreature permanents, accelerate its mana and generate card advantage outside of the principal tutor engines. The most difficult part of this is going to be fitting everything into convenient numbers for Birthing Pod and Wild Pair, but let's see what we can do!

Utility Creatures

  • Green Sun's Zenith
  • Eternal Witness
  • Duplicant
  • Solemn Simulacrum
  • Shriekmaw
  • Acidic Slime
  • Yavimaya Elder
  • Brutalizer Exarch
  • Glissa, the Traitor

The function of most of these should be pretty obvious, but there are a few interesting ones.

Glissa, the Traitor acts as another copy of Salvaging Station as well as creature removal, and sits at a sweet spot for Wild Pair. The deck really appreciates having access to her as a tutor target.

Acidic Slime is your obvious answer to pesky permanents, easily found by Birthing Pod. It is complemented by the slightly spicier Brutalizer Exarch, which is at a better spot for the purposes of Wild Pair and works double duty as a tutor.

Utility Spells

  • Tragic Slip
  • Maelstrom Pulse
  • Putrefy
  • Krosan Grip
  • Violent Ultimatum
  • Dread Return
  • Damnation
  • Blasphemous Act
  • Demonic Tutor
  • Diabolic Intent
  • Wayfarer's Bauble
  • Nihil Spellbomb
  • Horizon Spellbomb
  • Expedition Map
  • Voyager Staff
  • Scrabbling Claws
  • Executioner's Capsule

To begin with, we have some generic removal and cheap sweepers, the kind of effects everyone needs to have. But we've also got a few sweet things going on here!

Dread Return seems absurd for this deck. I've been looking for a deck that can justify running a "fair" Dread Return, and I think I've finally found a home. With the number of token generators we're running the flashback shouldn't be a big deal, and it may even be a boon to your team of Kresh and his impersonators. With so many value creatures eligible for reanimation, it's not a bad effect by any stretch; I'm excited to see how it turns out!

The other interesting suite of cards is the Salvaging Station package. The important thing to recognize is that none of these are bad on their own, and the potential exists to stick a Salvaging Station and just go off, generating way more cards than a typical Jund deck. Each of the trinkets also provide utility effects that can be useful to recur at a later point in the game.

It's possible that Salvaging Station is just too cute to take up this many slots, but for now I think it's worth running.

Mana Ramp

  • Sakura-Tribe Elder
  • Kodama's Reach
  • Cultivate
  • Explosive Vegetation
  • Caravan Vigil
  • Primeval Titan

As with most Commander decks, this deck has a ton of high-cost spells and engines, as well as intensive color requirements. Ramp is important in alleviating these problems.

The only card that may seem out of place here is Caravan Vigil.

I've tried this card before in several decks and was quite satisfied. It's not difficult to get Morbid in a multiplayer game, and when that happens Caravan Vigil is effectively free. Primal Growth might be better in this slot, since it's a similar effect that also enables morbid, but I have a foil Caravan Vigil that's been looking for a home!

The Mana Base

  • Urborg, Tomb of Yawgmoth
  • Tainted Peak
  • Tainted Wood
  • Dragonskull Summit
  • Woodland Cemetery
  • Savage Lands
  • High Market
  • Phyrexian Altar
  • Reflecting Pool
  • Command Tower
  • Terramorphic Expanse
  • Evolving Wilds
  • Bojuka Bog
  • Vesuva
  • Mosswort Bridge
  • Lavaclaw Reaches
  • Raging Ravine
  • Shizo, Death's Storehouse
  • Rakdos Carnarium
  • 6 Forest
  • 5 Swamp
  • 3 Mountain

Last but not least, the manabase. Three colors is actually a pretty good spot to be in as regards your mana. There are plenty of dual lands so your mana shouldn't be that bad once you figure out what your deck needs. But unlike in five color decks, there's enough space for utility lands and basics without resorting to an unusually high land count.

In this deck, for example, we get some sacrifice outlets in High Market and Phyrexian Altar, graveyard hate and card advantage in Bojuka Bog and Mosswort Bridge, and manlands in Raging Ravine and Lavaclaw Reaches. Vesuva helps you capitalize even more on your utility lands (or anyone else's for that matter) and Shizo, Death's Storehouse lets you one-shot people out of the blue with Kresh!

There's certainly space for more nonbasics in the deck if you have them; you could pretty easily cut up to three or four basic lands for something like Volrath's Stronghold or Maze of Ith.

Recently, I've been trying to limit the number of high-dollar cards in any given deck that I post. I think I've been doing a pretty reasonable job, and I'd like to keep the trend going. Just because you can throw a pile of expensive staples into a deck doesn't meant that you should; putting a budgetary restriction on decks forces you to be a little more creative and emphasize powerful interactions over individually powerful cards.

With the mana out of the way, here's the list that I'm starting with:

[deckbox did="a151" size="small" width="560"]

I'm excited to play with this, since it's an all-out Timmy deck and I don't have too many of those. Most of my decks revolve around convoluted and obscure interactions, whereas this one just focuses on going big!

It should be a nice change of pace from what I'm used to, and will be a ton of fun to play against the Melira, Sylvok Outcast-based combo decks that have been plaguing my group recently.

Be sure to check out next week, when we'll look at a Commander who usually lives in the shadow of Sharuum, the Hegemon. The giant sphinx isn't the only Esper legend, and Ertai, the Corrupted can do some pretty dumb things!

Carlos Gutierrez
cag5383@gmail.com

@cag5383 on Twitter

Insider: Standard’s Amorphous Evolution

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Last week, I endeavored to relate the various risks and rewards to trading in unique cards. This is a valuable topic in the realm of MTG Finance because profit margins are often much larger on obscure cards than on Standard staples. My hope was to elaborate upon the mathematical components of profit margins a bit further and…

I can’t do it. There is a much better topic I want to discuss this week. And boring you with some number crunching and percentages seems like a waste of your time. Let me rewind.

How Amazing Is Standard Right Now?

This format has an incredibly diverse metagame and it seems like every week there is a new frontrunner. Cards which used to dominate the format, such as Geist of Saint Traft, Moorland Haunt, and Kessig Wolf Run have now become interspersed with newcomers such as Huntmaster of the Fells, Elesh Norn, Grand Cenobite, and Sword of War and Peace.

I will be first to admit that I have not closely followed the Standard metagame for very long – perhaps since Fairies (uh… I mean Lorwyn) block at the latest. But I am going to jump out on a limb: this has got to be one of the most dynamic and diverse formats we have seen in a while.

We are in the midst of a brewer’s dream. Cards like Splinterfright hold such promise in this awesome metagame. And as soon as a particular strategy seems to earn top notch, another one comes along and trumps it.

Financially Speaking…

This is a financial column. I am not a Pro Tour player and I am not delusional – I recognize I am here to write about MTG Finance and not MTG Strategy.

Don’t get me wrong. This is an incredibly exciting time to speculate in Standard. Modern PTQ season is winding down in less than a month and Standard will garner even more spotlight. It is already the most popular Magic format, but it will gain even more popularity amongst PTQ grinders in the coming months.

This means there will be profiting on the horizon. But this time around we can’t simply acquire the most popular staples because that list of cards is changing at a rapid pace. This makes for exciting tournaments, but not having the trusty Jace, the Mind Sculptor, Maelstrom Pulse or Bitterblossom to acquire in droves makes for an uncertain time.

We speculators will have to work a bit harder this season. There will be tournament results bombarding us from all angles, and it is imperative we are aware of trends. No longer can we acquire Jund and Caw-blade staples in the off-season for some promised profit. Instead, we will have to think.

My Two Cents

I cannot promise that my predictions and speculations will always net you pure profit. If you want a guarantee, purchase Underground Seas. (chart courtesy of blacklotusproject)

What I can offer is my perspective on what cards are worth considering from four different tiers of risk:

  1. Prime Performers,
  2. Forgotten Favorites,
  3. Gradual Grinders, and
  4. Long Shots (I couldn’t think of another alliterative name).

Allow me to explain.

Prime Performers

No one can really predict what decks will make Top 8 at the next SCG open or Standard Grand Prix. There are a large number of viable options and Avacyn Restored is bound to shake up the list even more!

The idea for Prime Performers is to rapidly deal in the most popular cards. I want to emphasize the window in which you should operate here. As soon as you see a particular card see increase in favor, you need to move on them immediately. There is often a narrow span of a few days when you can purchase or trade for these cards before they peak.

However, you also should be able to unload the card within days of obtaining it. In this way, you can minimize risk. Wait too long and your card may fall out of favor, thereby dropping the card’s price and moving it into the next category.

My examples of (very) recent Prime Performers include Elesh Norn, Grand Cenobite and Darkslick Shores (charts courtesy of blacklotusprojects.com). Both have about doubled in price in the last month or so. The moment they started seeing increased play, there was a brief opportunity to acquire them cheaply. Now, the room to profit on these cards is nearly passed. Rest assured there will be others, but, unfortunately, I don’t have any definite candidates right now.

I hear a lot about Zombies – maybe Geralf's Messenger or Gravecrawler?

Forgotten Favorites

Cards in this category made a splash in Standard at one point but have since fallen out of favor due to metagame shifts. They are off their peak price significantly, but the precedence for higher prices is already established. They are still powerful cards.

I would consider these cards slightly more risky than the active top performers, but they have proven themselves already. Therefore you could do worse than to hold a few of these.

Because of how rapidly this format is evolving, there are many cards in this category. To list a few, consider Garruk Relentless, Geist of Saint Traft, Sword of Feast and Famine, Tempered Steel, Garruk, Primal Hunter, Elspeth Tirel, and the list goes on.

I’ve provided charts for Garruk Relentless and Geist of Saint Traft. The former I feel has nearly bottomed in price, while the latter may soon begin its decline.

Gradual Grinders

This category is my favorite one and, as a result, much of my trade binder consists of these cards. There are very good reasons for this.

Cards in this category should remain fairly well-positioned regardless of how the metagame shifts. While there can be no guarantees, these cards should have a higher likelihood of increasing in value from where they currently are. However, they may be a bit cheaper now because either demand is soft or supply is too large.

The best examples of these cards are all the rare lands in Innistrad and Dark Ascension. My favorites are the Innistrad Duals. Many of you should already know this because I’ve written about them in the past. In fact, a few weeks ago I shared their price trends, indicating that they bottomed. Don’t believe me? Check out this link: https://www.quietspeculation.com/2012/01/insider-a-very-exciting-time-to-speculate/

Here’s the picture from that article, depicting the trend on the Innistrad duals as of January 11th, 2012:

And here’s the same trend today, as of March 3rd, 2012 (charts courtesy of bloacklotusproject.com):

It is quite clear that the bottom I called in early January was in fact accurate (so far). But notice how only Isolated Chapel and Woodland Cemetery have shown recovery.

I want to emphasize that these cards are all mana-fixing lands. Barring a reprint, at least one land from this cycle will be trading at a premium from its bottom. Right now it’s the B/W land, but as the metagame shifts each of the other four may get their chance to shine. Downside risk on these other four is low. Which is why I love this category.

In addition to the Innistrad Duals, the spell-lands from Dark Ascension and Innistrad are also worth acquiring at such a cheap price. Also, Ratchet Bomb would have been a great card in this category before it spiked. Although a reprint, Solemn Simulacrum is another card which should remain strong no matter the metagame.

One last example is Black Sun's Zenith. It’s relatively cheap but represents one of the most efficient board sweepers in this Standard format. It’s not likely to become a $10 card, but being a premier board sweeper in Standard earns it a spot in my MTG portfolio (chart courtesy of blacklotusproject.com)

Long Shots

These are the Skaab Ruinator and Splinterfrights of the world. They are cards that seem synergistic with the mechanics of a given set but have not broken out yet. Even Heartless Summoning and Havengul Lich may qualify to fall in this category. While they have made Star City Game Open Top 8s, they have still not shown up in numbers at tournaments. Thus, there is room for them to go up or down.

I like buying a few cards from this category for my collection, but not excessively. Unless you want to make a hobby of collecting a given card for personal reasons, I personally don’t advise going too deep. I tried that with Past in Flames and it came back to bite me. I suppose there’s still time, but the Standard metagame is nowhere near a place where Past in Flames can be good.

A Balance

Like everything in life, a smart strategy is to diversify across all four categories. This way your collection is always relevant and you are enabled to trade with anyone at any tournament looking for Standard cards.

A good goal to strive for is continue to buy, sell, and trade cards regularly so that your collection always has something for everybody. It’s a fair strategy across all formats as well. You’ll rarely make $1,000 on one card this way, but you will always have a full collection worth looking at. After all, with this strategy, it’s all about the journey.

-Sigmund Ausfresser
@sigfig8

Insider: Using Bid Schedulers to Price-Enforce Ebay

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You've browsed through Completed Listings on Ebay before, trying to get a read on what price you should bid for a card you'd like. There are eight or ten at a normal price, and then there's one that went for far less than it should have. Sometimes this happens because the listing ended late at night; other times, it's because an auction for the same item just ended and people might not have aggressively bid on two of the same card.

If you want to be the lucky person snagging those underpriced cards; if you want to assemble a collection while you sleep, with an hour a week worth of work; if you have the patience to wait out some great prices because "your door is always open," then this article is for you. This article is about how you can use bidding schedulers to automatically scoop up cards that you want at prices below what they should be. Kelly Reid coined the term "Price Enforcing" to describe the process of going to local stores and looting the cases for underpriced cards, and there's no reason you cannot do it on Ebay, either.

What is a bid scheduler?

These are programs or websites that will automatically place a bid for you when you tell it to. They will bid the price that you would like and put it in when you specify that it should. You shouldn't just tack bids onto every item you see, because people are emotionally tied to their desire to win. They will just re-raise you. Bidding in the last few seconds cuts off the possibility of a re-raise.

You really shouldn't be paying money for scheduled bids, even if it is a couple of pennies. You should avoid downloaded programs; they are simply a pain in the butt and you expose yourself to spyware. I use www.biddingscheduler.com to bid on Magic cards. They use advertising to make money (ads I don't see, thank you No-Script). Firefox warns me that the information I send is encrypted but going to a third party. This is somewhat concerning, because it has my Ebay ID and password, but my Paypal is not linked to it. I haven't had problems in the months that I've used it. Use your best judgment and never give out a Paypal password.

What cards should I target for price enforcement?

I have been snagging Ravnica shock lands for awhile. They exhibit a high degree of variability in price and they are worth a bit of money; I definitely wouldn't do this with dollar cards most of the time. Generally, any card worth about $15 that has a good trade volume is a good target. Something that makes your trade binder look better is also nice. If you want to narrow things down, take a look at the charts on www.magictraders.com and look up your cards. For example, here is what Breeding Pool says:

Card                            Price StdDev Average  High    Low   Change Raw N

Breeding Pool, 23.08, 8.68, 24.21, 32.99, 16.84, -0.14, 51
This has all the hallmarks of an excellent card to sit on with your bidding scheduler. It's got a good price, a good volume (the Raw N number) and it's got an insane standard deviation. If you avoided Stats 110 in college, standard deviation is generally a measure of how far the price varies from the most common price. The difference between the high and low is nearly $20 and the deviation is $8.68. That means that the price wildly varies, which is corroborated by just looking up the card sales. The cheap sales were regular cards, in good condition. The expensive cards are selling because there are bidding wars on them, not because they are foil/altered/foreign. I made sure that the prices were current and that there were some going low and some going high - pay attention that you're not just looking at the residue of a burst bubble.

How should I bid?

I try to set a price that's pretty close to what the cards are selling for normally. I want a deal, but I also want to win a few of these. I also put in bids on every card at auction. I make sure the shipping price isn't astronomical and I adjust my price on it. Let's take a quick look at some investing theory, by way of Benjamin Graham. He came up with the idea of "Mr. Market," which was a personification of the stock market that sat down at your desk all day during trading hours. Sometimes, he'd say "look, I'll sell you all the Breeding Pools you want at $30" and you'll balk. Other times, he comes in drunk to work and says "sell me as many Breeding Pools as you have for $35." If you don't want to do business with Mr. Market that day, you pass. You only engage the market when it's profitable for you to. You get to act like Mr. Market in this (but sober!). You say to Ebay, "look, I'll buy any Breeding Pools you're willing to sell for $19 shipped." You tell Ebay this by scheduling all of your bids on auctions for Breeding Pools to reflect this. Sometimes, the market won't sell you anything. Other times, you'll get a deluge of good cards for low prices. Since you are assembling cards to trade or flip, you don't care that you now have eleven Breeding Pools.

Eventually, your scheduler will look like this:

Only one winner; too many winners and you're doing something wrong.

In this example, I only won one card - a Blood Crypt for $13.50 shipped. The other Blood Crypt went for $18.00 shipped, which was closer to the going rate at the time - a big savings, and one that especially adds up over time.

Note the caption on the picture. If you are winning a lot of these, you are screwing up! You're showing up drunk to work again, Mr. Market! If you're winning a lot, that means that you're paying closer to market price. You are not getting the scoops, you're just paying what every other schmoe does. The cure for this disorder is to lower your "will buy for" price and place a lot more bids. You will win a lot less, but you will get much better deals.

I suggest checking in on Ebay two times a week. It'll usually take a half hour or less to check your list of cards. Use  Ebay's filters and just find the new auctions for cards that you want to watch. Make sure to pay your bills when you win cards and keep a very clear list of what you have won. Check off cards when they arrive (and note who sent them), or you will lose track of something and lose all your money on it. I speak from experience.

If you do this, you will win cards for a lot less than what they normally go for. Look, I can't explain why people set their auctions to end at 2am on a Tuesday morning, but they do. They put up auctions for cards that don't have a lot of motion or turnover, and they'll sell very cheaply. These are the sort of auctions you can win with a good frequency.

Why should I schedule bids if I'm not building a big binder?

This is a legitimate question, and there are two reasons you should still do this. First, you should schedule all of your bids anyway - it's a fact that people will re-raise you on Ebay even if they think they've already bid their highest amount. You're buying commodities, not unique items, so you don't need to win that one antique letter opener (like me last month). Schedulers will tell you when your scheduled bid is too low, so you can raise it if you really need to win the item - and you're doing it with stealth.

Second, if you trade at all, this is a great way to buy trade stock at a really good price. You can buy all the Breeding Pools you can at $20 and then put them in your binder for $27 in trade. That's an entirely fair trading price and you've bought the cards at about a 25% discount. Anything you trade them into will have the same discount applied. You don't even have to pick big, dynamic cards to trade in, as long as they have a good secondary market. I've been sitting on Tawnos's Coffin auctions for awhile now. Every now and then, the $15 card will sell for $4. I'm determined to be the next one to get it at a fire sale price, and the Coffin is such a fun Commander card that I'll have no trouble getting rid of it. I just saw a High Market close for $2.25 shipped, when that card easily trades at $5 on any floor you'll find.

When you are buying your binder's contents for 60 cents on the dollar, you don't have to rip off trading partners to make real profits. Nobody seems to be price-enforcing Ebay right now and this is a great untapped market for Insiders. Like I said, this takes very little work and it will remind you of the old thrills when you first started winning auctions on Ebay again.

I'm happy to answer questions about the theory and practice here. Join me next week when we look at more trading techniques and tips!

-Doug Linn


	

Douglas Linn

Doug Linn has been playing Magic since 1996 and has had a keen interest in Legacy and Modern. By keeping up closely with emerging trends in the field, Doug is able to predict what cards to buy and when to sell them for a substantial profit. Since the Eternal market follows a routine boom-bust cycle, the time to buy and sell short-term speculative investments is often a narrow window. Because Eternal cards often spike in value once people know why they are good, it is essential for a trader to be connected to the format to get great buys before anyone else. Outside of Magic, Doug is an attorney in the state of Ohio.  Doug is a founding member of Quiet Speculation, and brings with him a tremendous amount of business savvy.

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Insider: State of the Modern Staple

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Last week was a fun and informative look back at some old trades I made, and I plan to bring it back as a topic in the future, as well as posting new trades, but this week it’s time we got back to the Grindstone, so to speak.

We’re now being inundated with decklists, with GPs and SCG Opens happening nearly every weekend. The information is flying at us from every angle, and it’s easy for a new card or deck to steal the spotlight. Standard seems to be in a good, if predictable, place (not an indictment of the format), so I don’t see too much interesting happening there at the moment.

So, rather than focus on that, I want to look at Modern.

And I’m not here to hype you on the merits of Seismic Assault or something else new that’s come on of late. There were something like 12-14 unique decks vying for Top 8 spots in the last round of GP Hoth, and from that we can deduce a few things.

Yes, it says good things about the format that so many decks were in contention. But it’s still a very fledgling format that hasn’t been sorted yet.

Legacy used to be much the same until it started getting played every week and broken down by the best. That is why there is most certainly a metagame to Legacy now, even if decks occasionally break the mold and pop up (Burn!).

I see Modern evolving much the same way.

So, while you should certainly be aware of the newest trends and act accordingly, you need to keep in mind that it can all change very rapidly.

But we know there are some things in the format that will stay very safe bets, and that’s where I want to focus our attention this week. I’m not just going to provide another list of Modern cards to have, as myself and others have done in the past.

Rather, I want to look at the price of these cards today compared to their price on the day the most recent round of bannings were announced. Since the format seems to be in a healthy place, I think it’s safe to say we won’t see a lot more banned soon unless that assessment changes.

Ergo, we can fairly accurately evaluate the status and changes in the Black Lotus Project (eBay) prices of these staples with confidence. They should stay “staples” for a good while and can help us make our investment decisions accordingly. Let’s dig in.

The Staples

Fetchlands

This is, in my opinion, the safest thing you can do in Modern finance-wise. If you’ve read much of my past work, you know of my love for lands and my Fetchland project. It’s possible we see a reprint of one of these in FTV: Realms, but I doubt it (since it wouldn’t exactly be from “the vault”).

We’re going to use Scalding Tarn as our baseline, since it’s the most commonly used.

Dec. 20, 2011: $10.35

March 1, 2012: $11.67

Here we see the slow growth we expected from the fetchlands. This still leaves a ton of room for upward growth, and, barring reprints, these will continue to rise. Can’t suggest trading into these any more strongly.

Tarmogoyf

Dec. 20, 2011: $73.31

March 1, 2012: $79.05

This still seems as safe as ever, though I imagine the chance of this seeing a reprint somewhere along the line is quite high.

I hit on these two first because it reveals something very important – even cards that were already Modern staples pre-banning are continuing to rise. This means the format is not being viewed as a passing fad by the player base and confidence in the format is high. This means these are stable prices from the angle, and reprints are the biggest thing to watch out for.

Onto more interesting cards (finance-wise).

Hallowed Fountain

Dec. 20, 2011: $22.08

March 1, 2012: $26.04

This is also interesting. The card is down since its highs in September that were primarily driven by speculation rather than actual demand, but has risen since December. I think this strengthens the point above that true demand is driving the prices on Modern staples at this point and will continue to do so.

Chord of Calling

Dec. 20, 2011: $2.87

March 1, 2012: $6.13

Here’s one of the new “staples” of the post-ban metagame, and we see the drastic increase you would expect from such. Ever since Green Sun's Zenith got the boot, this has been the go-to card, over even Summoners Pact. The fact that Melira Pod (which are both cards you should grab on the cheap) is a true player means that Chord will hold value competitively.

But more important is that Chord seems to be an acceptable tutor for Wizards to allow and probably won’t see the banhammer like Zenith did. The biggest reason is probably that Zenithing for a Dryad Arbor in addition to a late-game bomb was too powerful, whereas Chord doesn’t present that danger.

Inquisition of Kozilek

Dec. 20, 2011: $1.78

March 1, 2012: $1.87

We haven’t seen much movement here, but I think this is one of the best speculation targets in the format. More and more decks are starting to use Inquisition over Thoughtseize. It hits a lot of the important cards that ‘Seize does but doesn’t lose you the life, which is proving to be extremely relevant in the format.

Kitchen Finks

Dec. 20, 2011: $3.30

March 1, 2012: $4.91

I understand that it has a set-specific keyword, but this thing has to be ripe for a reprint in some ancillary product in the next year or two. That leaves plenty of time for you to continue to profit off of them, however.

This thing is insane in the format in all variety of decks. And even people who realize it’s not a bulk Uncommon won’t realize it retails for $5-7. Continue to move on these.

Arcbound Ravager

Dec. 20, 2011: $14.34

March 1, 2012: $17.66

Another staple, another price increase. Affinity may be on the edge of having something banned to bring it a little more in line since it’s put up the best and most consistent results of any deck, but for now it seems to be safe, which means Ravager is a fine investment. It’s important to note that this card was worth real money before Modern was a thing, which helps back its price.

Dark Confidant

Dec. 20, 2011: $29.67

March 1, 2012: $34.60

Another card that I would put at risk of a reprint somewhere (because it’s older and so well-known), but for now Bob looks safe. As I wrote back in April 2011 (when I suggested buying Bobs at $14), drawing cards isn’t getting worse any time soon, so I wouldn’t be worried about putting your money in Bobs.

Rounding Up

That’s more than enough cards to spot the trend. Modern cards, across the board, are up solidly in just the last three months. This allows us to throw out the hype from the format’s creation or the rampant speculation that followed and see that demand is truly driving card prices.

What does this mean for us? Besides the fact that our current holdings are staying stable, it means that we can expect slow appreciation on those cards just like we plan on for Legacy.

This means that, moving forward, you can treat something like Cryptic Command or Life from the Loam like you would treat Polluted Delta or Lions Eye Diamond – as cards that will hold value and resell at a better percentage than Standard fare. This bodes very well for Modern as a format and for all the investments you’ve hopefully already made into it.

Thanks for reading,

Corbin Hosler
@Chosler88 on Twitter

Unleashing the Zombie Apocalypse

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This past weekend I traveled out to Columbus, Ohio to attend the two PTQs being held there. While I was away, there were some other big events going on around the east coast. Star City Games held one of their signature events down in Memphis and Wizards held a Grand Prix in Baltimore. Since I was living in my own little Modern world at the PTQs, I missed most of the coverage surrounding these other two events. While taking a look at them this week, I noticed a trend that I wanted to share with everyone today.

Zombies on the Rise

If you're like me, you certainly can't remember the last time that zombies as a tribe were competitive. Until now, zombies have been just another casual tribe that overzealous players have tried and failed to pilot successfully. Well, you had better throw that mentality out the window, because this tribe is here in force with the new cards from Dark Ascension.

Gravecrawler is the real deal. It feels like cheating when you cast him from the graveyard for the same efficient one-mana cost printed in his upper-right corner. Eat your heart out, Skaab Ruinator! Along with Gravecrawler, Geralfs Messenger provides another aggressively costed creature that synergizes with the zombie theme. We even have Diregraf Ghoul to pair with them.

Since Dark Ascension came out, I have suspected that Gravecrawler and [card Geralfs Messenger]Messenger[/card] would be enough to carry an aggressive black archetype. I put some work into the deck, but it did not seem to come together.

The key to making this deck viable was brought to light in a deck tech from the Pro Tour. The seemingly innocent draft reject Skirsdag High Priest, along with Fume Spitter, provide an additional angle of attack for a typically linear aggro deck.

Skirsdag High Priest preforms quite well against other aggressive decks, especially when you are on the draw or forced into a more defensive role.

Of course, the majority of the time, Zombies will not have the luxury of running defense. Gravecrawler can’t block at all and Geralfs Messenger can’t block the turn you play him. The reigning zombie motto is, “The best defense is a good offense.”

Whichever side of this match-up you find yourself on, remember well this adage.

Managing Your Zombie Hordes

Last Friday I played the blue/black version of Zombies at my FNM and did not lose a single game in the four round event. The deck is for real, and if you dismiss it as sub-par or underpowered, you may well find yourself on the losing end of your match against it. It is quite powerful, and a ton of fun to play as well.

This innocent-looking aggro deck actually involves lots of decisions and allows for ample room to out-play your opponent. A lot of the deck's intricacies are not apparent at first glance.

Mortarpod, for example, is one of the best cards in the deck due to its ability to trigger Morbid. Several of my opponents, good players at that, just plum forgot it was a creature. Usually, Mortarpod acts as a mere removal spell that can subsequently be reequipped for value. In this deck, the Germ token has added value as a body to tap for [card Skirsdag High Priest]Skirsdag High Priest's[/card] ability.

Let me mention Gravecrawler again for a moment. While he seems like a fairly straight-forward card, he actually forces you to play a slightly different game.

As competitive Magic players, we sometimes take for granted how we play cards because we are so used to doing things that way. We generally wait to play new creatures until after combat in order to leave mana up. This not only helps us win more combats, but also gives our opponent less information about our plans. In short, playing creatures during the second main phase is almost always better.

In this deck there are plenty of times when that is not the case.

One time in particular, I drew my card for the turn and immediately moved to combat, only to realize that my opponent could block my Gravecrawler. This would leave me without another zombie and hence unable to rebuy the Gravecrawler. Luckily I had top-decked one, but if I not, I would have missed an attack for no good reason.

When to play Diregraf Captain applies here too, but playing your lord before combat to gain the additional power and toughness should be easier to see.

The Anatomy of an Undead Army

Getting back to my original point, Zombies is very good. In case you missed it, the deck made top eight of both the Grand Prix and SCG events this past weekend. At the SCG event, there were a total of two copies in the top eight and two more in the top sixteen.

There is some disagreement over exactly how to build the zombie deck. The core is the same in all of them, but that core basically boils down to Gravecrawler and Geralfs Messenger. Blue mana is not even guaranteed, as one of the SCG decks splashed white for Lingering Souls and some players opt for a red splash instead. All in all, there is still lots of room for innovation.

The version from this weekend that most closely resembled mine was Matt Scott's, which he piloted to the top eight of the Grand Prix. Here is his list:

Matt Scott's UB Zombies

Standard -- Grand Prix Baltimore 2012

Untitled Deck

Creatures

4 Diregraf Captain
4 Diregraf Ghoul
2 Fume Spitter
4 Geralfs Messenger
4 Gravecrawler
4 Phantasmal Image
2 Phyrexian Obliterator
2 Skirsdag High Priest

Spells

3 Geths Verdict
4 Mortarpod
2 Sword of Feast and Famine
3 Tragic Slip

Lands

4 Darkslick Shores
4 Drowned Catacomb
14 Swamp

Sideboard

1 Cemetery Reaper
3 Corrosive Gale
3 Distress
2 Nihil Spellbomb
1 Phyrexian Metamorph
2 Phyrexian Obliterator
1 Swamp
2 Sword of War and Peace


The main difference between this list and mine is Matt's inclusion of Sword of Feast and Famine. This card has been virtually absent from Standard for a few months now, but we may see a resurgence due to the recent popularity of Wolf Run Ramp and Blue Black Control. Sword seems well suited to bring down both of these decks, as attacking their hand can be an effective strategy.

However, Protection is not what it used to be because of the adoption of cards like Geths Verdict, Liliana of the Veil and Slagstorm. The sword's mana cost is also of some concern. With only twenty-two lands, you may have a rough time surprising opponents. Usually you'll need to take a turn to play the sword and another to equip it. Luckily, you do have a recurring threat in Gravecrawler, which makes Sword better.

In the current iteration of my list, I've opted for fewer [card Diregraf Captain]Diregraf Captains[/card] and more [card Fume Spitter]Fume Spitters[/card], but the rest of the cards are basically the same. If you like this deck, there is some wiggle room to adjust it to your play style and preferences.

Conclusion

After playing Red Black Vampires for so long last season, I found it easy to jump on board with this deck. If you enjoy an aggro-control strategy, this may be the deck for you.

You can even relive last season and jam red/black aggro all over again! Just thinking about Brimstone Volley in a deck with Mortarpod and Fume Spitter has me itching to brew up a red/black list.

That, however, is for another day. For now, I am set on the power of Phantasmal Image.

Regardless of your like or dislike for the zombie tribe, make sure you're prepared for it at your next major event. No life total is safe.

Until next time,

Unleash the Zombie Apocalypse!

Mike Lanigan
MtgJedi on Twitter
Jedicouncilman23@gmail.com

Monday Night Magic #299 | Pray I Don’t Alter It Any Further

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-- Pastimes responds to playmat fiasco

-- Edgar Flores suspended for 3 months "for misrepresenting game state" supposedly due to his DQ at SCG Indy

-- But Dad, Two Explores by Scott Holmes

-- Congratulations to Raphael Levy who is now officially the all-time leader on Pro Points. He passed Kai Budde with a 32nd place at #gpmadrid

-- GP Madrid

-- GP Baltimore

-- Quote from Scott Marshall (Level 5 DCI Judge):  I expect that the next PTQ round will be placed with stores.  NOTE:  The next season starts on April 1st.

-- Aaron Forsythe Twitter Quote -- Cool #WorldMagicCup fact #1: Team members will be able to talk to each other as they build their draft decks on Day 1.

-- Aaron Forsythe Twitter Quote -- Cool #WorldMagicCup fact #2: The first tiebreaker for determining which player gets cut after Day 1 will be Pro Point total from this year

-- The Magic Cup Rules

-- The Magic Cup Player Race and Possible Qualifiers (Brian David-Marshall)

-- MTGO Release Events -- Feb 22 through March 9

-- What do you think of playing altered cards in a tournament? There's text box confusion, possibility of cheating, etc

-- Heading 3.3 Authorized Cards: Artistic modifications are acceptable in sanctioned tournaments, provided that the modifications do not make the card unrecognizable, contain substantial strategic advice, or contain offensive images.  Artistic modifications also may not obstruct or change the mana cost or name of the card.

The Head Judge is the final authority on acceptable cards for a tournament.

-- The MortarPod Podcast is done and will no longer exist.  The hosts have requested that all of its shows be pulled off of the MTGCast Network immediately as well, making them the first such Podcast to request "self-censorship" from the internet.

-- We'll start here for next week

-- Gold Run at GP:SLC -- $12,000 in free cards

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Insider: Did You Know..?

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We’re at a in interesting place in the financial world of Magic. And with the changes to set releases back in 2009, the Pro-Tour and GP schedule changes over the last several years, and the increased frequency and spread of the SCG opens, getting a better feel for what the seasonality of demand really looks like is possible.

We also get amazing promotional products geared for different types of players and collectors like Commander products and From the Vaults. Sometimes I get so caught up in the right now, we need to step back and look at the big picture again.

Did you know... Modern PTQ season ends in 31 days?

Our LGS hosted its first PTQ in history this season and it was a pretty awesome event. For the weeks leading up to it, almost all trade talks in the store involved one person trying to locate a Modern card to finish up their deck.

Since then, however, I’ve been watching people dump that stuff back off for Standard cards. Why? Because, believe it or not, when you have a PTQ or even just a “special” event at your store, all the players who play there want to try it out.

They all wanted to give their Modern homebrew a run against the top decks. Now it’s over, they’re ready to go back to EDH or Standard or Draft, or what ever it is that scratches their itch. After Modern season ends, the quantity of people interested in Modern dwindles quickly, and even as the season approaches a close, people will be shifting away form their Modern cards as soon as it becomes irrelevant to them.

In my community, for some players that was this past Saturday. For others it’s in two weeks after a PTQ 80 miles away. I plan to use my Modern deck a few more times, so I can’t tear it apart yet, but any other trade stock is getting dumped at GP Seattle this weekend to the highest Buy List.

Whatever you need to play kepp, but, from a financial standpoint, anything that has already showed significant gains, is ready to ship out. Exceptions are cards that maintain relevance either in Standard or Legacy.

Did you know... Wizards is releasing a Land centric From the Vaults: Realms?

Sure, who knows what 15 lands will be all foiled out for this promotion, but FTV: Dragons still sells for over $75 sealed on eBay. And if we key cards in this set, it will surpass all of its predecessors.

If any retailer starts pre-selling these before spoilers hit of what’s inside, I’m going to gamble on it as big as possible. And so is Ted Knutson, and he usually doesn't open his mouth without knowing what he's talking about.

The art on the front of the announcement sure as heck looks like a Glacial Chasm to me, and I’d be willing to wager we see that in the pile. While a narrow Legacy card, it’s still a Legacy card and alone would see some demand.

Keep in mind, we won’t be seeing Dual Lands or Tabernacle of the Pendrell Vale as they are on the Reserved List, but there are plenty of desirable lands that aren’t. And remember that they usually include a spoiler from the new block in this set, so we should be watching this as it develops very closely.

Did you know... Standard is still Top Dawg?

Back in May of last year, I wrote about “Riding PTQ Waves”. So, let’s keep riding them.

As mentioned in the first section, Modern Season is ending and Standard is on it’s way. Combine that with the LGS promotions WotC is running, including Game Days, makes Standard a “Year-round” format.Of course PTQ season inflates it and we need to be prepped for it.

Innistrad Lands really have shot up a lot faster than I thought they would, so hopefully you started picking them up upon my reccomendation in November. These are only going to continue to grow. Even then I was skeptical of some of the non-Blue lands, but since then we’ve seen the printing of Sorin, Lord of Innistrad and Lingering Souls, so we can safely assume that Isolated Chapel is going to be around.

If you can connect the dots here, I’m suggesting to move out any excess Modern stock for Standard manabase. And do so en masse. I know QS’s own Sigmund (@sigfig8) is sensing the same thing I am, and I’ve spent the better course of a year laying out what this seasonal cycle looks like and how to be best positioned. Time to take the full cycle's results and package it into our business plan to make the next cycle even better.

I’m looking forward to a profitable Standard Season while I close out my profits on Modern.

I’ve been meaning to post a piece about taxes with respect to Magic profits, but I had a delay with my interview, so for those that mentioned it on Twitter, it’s coming next week.

Also, if you’ll be at GP Seattle, ping me on Twitter (@torerotutor) and say hello!

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