What you don't know about auctions -- and should

What you need to know about auctions and the items in them is that auction houses are essentially clearinghouses for pretty much any object that exists in the world. So if you're an avid hookah collector, an Impressionism art collector, a Judy Garland memorabilia hound or in the market for vintage jewelry, a new car, a forklift or even an old lock from a San Quentin prison cell, chances are you'll find it at auction.

So where do auction houses get their wares? According to AUCTIONEER$ expert and entrepreneur, Deborah Weidenhamer, items come from individuals and families seeking to liquidate their assets or collections, trusts, financial institutions, police forces and government agencies, to name a few. Auction houses also host appraisal fairs and go into the field to find new clients with objects to bring to auction.

And, yes, there is a correlation between the types of items available (and the amount of them on the market) and economic conditions. Weidenhamer explains it as, "When the economy is in a downturn, the first thing that we see are business liquidations and typically restaurants that are going out of business first, and then it sort of moves up the food chain in businesses of who goes out next. The reason restaurants go out first is because it's the first thing that consumers can cut is really eating out, and then we start seeing retail establishments that have non-necessary items go out. So boutiques, those kinds of things will go next."

The bottom line? The law of supply and demand applies to auctions. So if you're a foodie who's always wanted a restaurant-grade stove, you could ring yourself a real deal. But before you look up your nearest auction house, find out what an auctioneer's chant is and the psychology of bidding, including the art of the stink eye.

You hear the mesmerizing patois of the auctioneer rhythmically announcing the bid increases. You feel your blood pressure escalate and your eyes widen as the opening bid amount triples and then quadruples. The room seems to tilt a few degrees, and time seems to flash by as the auctioneer reaches a crescendo pitch. What just happened?

You've just been sucked into the action by the auctioneer's chant, a kind of syncopated chatter punctuated by bid increments. So what makes the auctioneer's chant so entrancing, and why the chit chat between bid amounts?

This rapid-fire speech is a learned art meant to create momentum and engage the crowd in a bit of theatrics while keeping the pace of the sale moving along. The words sputtered between bid amounts are known as "filler words" and are usually unique to the auctioneer. As an example, Weidenhamer recalls an auctioneer who uses "Yabba, dabba, doo" as his chant in-fill.

If you're bidding, the key is to stay cool and not let the mounting beat of the chant push you past your bidding comfort zone. And if you're not bidding, make sure to note how the sing-song chant affects the behavior of the bidders. As the auctioneer speeds up and becomes louder, do rival bidders bow up?

Auctioneers' Deborah Weidenhamer recommends that first-timers make sure to speak up and "bid loud and bid large." There are sometimes thousands of people in an auction audience, so the subtle-wink strategy isn't the most effective one.

Then there's the psychological side of auctions. Think about it: You've had a chance to check out the merchandise before the auction. Say it's a dollhouse that you just know your kid would swoon over. Now you're emotionally invested. And so are two other families eyeing the dollhouse.

Weidenhamer advises, "A lot of times at an auction you're going to have people that try to stare you down or intimidate you from bidding. So just don't get intimidated, just keep on bidding." That means that you'll need to block out any bad vibes and focus on the bidding. Or you could develop your own repertoire of intimidating body language -- crossed arms, bowed chest and a mean stink eye of your own. Still, this strategy can't protect you from the Winner's Curse.

Founder and CEO of Auctions Systems Auctioneers and Appraisers, Deborah Weidenhamer's biggest piece of auction advice is to do your homework. Make sure to check out the item during the preview period when you can inspect it thoroughly, particularly since everything at auction is sold as-is, where-is.

You should also do a fair amount of market research to determine an item's true value and then check in with your budget to determine the dollar amount that you're willing to bid up to. That way when you're in the heat of a bidding war, you'll be well-informed and can make good bidding choices. Otherwise, you could run into the dreaded Winner's Curse.

According to Weidenhamer, "The theory of the winner's curse, which I don't actually believe is true, is that the person who knew the least about the value of the item is the one who pays too much." This is an unlikely scenario given that most auction items sell for their market value. But for the bid-happy, the bottom line is research, research, research.

On the other side of the coin, if you're in the market to unload your own treasures you may want to scour your own attic for any unused items and keepsakes. They may just fetch a pretty penny at auction.