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I don't necessarily agree that the supply vs demand model doesn't work for eBay. I think it does. Demand is down (economy, ebay sucks, whatever) so supply is fairly fat, and the prices (for the most part) are declining. That being said, eBay is difficult to forecast using economic models, primarily due to the fact that one nitwit with more money than sense can significantly skew the analysis. And this same fact is why I argue with sellers I deal with who try to use the "Well, this widget goes for $300 on eBay". I usually counter with, "Then perhaps you should sell it on eBay; me and my 50 bucks will look elsewhere."
Just because one desperate person paid an unreasonable amount for some item does not mean that all of the remaining like-items are now worth the same amount (unless that same desperate person needs many more of the same item and has money to burn).
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