Money can be exchanged for goods and services.  If you do not have enough money, you cannot purchase certain goods nor services.

Gasoline, for example, is at the moment "expensive" for many people.

Generators, for example, may be "expensive" after a hurricane.

Discussion Point:  Price controls, taxes, supply, monetary policy and many other factors impact prices that one must pay for goods and services.  Is there such a thing as "gouging" or "over-pricing" or is the best cure for high prices just that - high prices?

G

PS - feel free to discuss "expensive" stocks and securities.  Also, explain how US Govt. debt impacts your daily economic activity.

Day crew, perhaps?

G

From this page:

“Morally, an individual has the right to ask any price he wants for a good or service he owns--and a buyer has an equal right to refuse that price. In a truly free society, the government is not granted the power to dictate to sellers and buyers the terms of a sale. Such power is found in dictatorships, not in nations that respect individual rights.”

“When prices are free to rise, producers in a capitalist economy are motivated to create a greater supply. Since they can now make more money from sales of the product, it is in their self-interest to get more of it to market. On the other hand, restricting prices of a good not only violates the rights of sellers and buyers, it inevitably leads to shortages of the particular good “protected” by the government’s policy.”

Two scenarios:

First:  I own a used car lot.  You come to the lot and want to buy the Toyota.  I am asking $6,500.  You say you want to pay $3,000.  I say no, but I will take $5,000 for it.  You reply "If I don't have a car I cannot work and if I cannot work I cannot pay for food and I will starve to death.  I only have $3,000."  I suggest you buy a cheaper car or shop elsewhere.  You say I am a thief and a gouger and storm off.  You call the state attorney general who says "there is nothing we can do."

Second:  I own a power tool shop.  I have one generator left after a storm.  I want to charge $1,000 and the pre-storm price was $650.  You say you want to pay $650.  I say no, I want a premium because there are very few generators and no more will arrive soon.  You say I am a gouger and a thief, because there has been a storm and my new price is inconvenient for you.  You leave and call the state attorney general who fines me for "gouging."  

Do I lose my property rights due to a storm?

G

tag for later 'cuz I gotta head to work.  I'll try to comment in a few hours.

Trey

Quoted: Do I lose my property rights due to a storm?

Do you lose your rights?  No.  But due to bad philosophy in the culture, you will be accused, and probably convicted, of price gouging.  Your property rights will be violated by the government.

Quoted: Two scenarios: First:  I own a used car lot.  You come to the lot and want to buy the Toyota.  I am asking $6,500.  You say you want to pay $3,000.  I say no, but I will take $5,000 for it.  You reply "If I don't have a car I cannot work and if I cannot work I cannot pay for food and I will starve to death.  I only have $3,000."  I suggest you buy a cheaper car or shop elsewhere.  You say I am a thief and a gouger and storm off.  You call the state attorney general who says "there is nothing we can do." Second:  I own a power tool shop.  I have one generator left after a storm.  I want to charge $1,000 and the pre-storm price was $650.  You say you want to pay $650.  I say no, I want a premium because there are very few generators and no more will arrive soon.  You say I am a gouger and a thief, because there has been a storm and my new price is inconvenient for you.  You leave and call the state attorney general who fines me for "gouging."   Do I lose my property rights due to a storm? G

I love economics threads.

Depends if it is a generally ellastic or inellastic item or if it is priced above, below, or at the market equillibrium. Also shifts in the demand curve and position of the demand curve affect this aswell.

Consumer income (many more specifics in it) can alter what is 'price gouging'.

ok, going back to eco 101....


You say I am a gouger and a thief, because there has been a storm and my new price is inconvenient for you. You leave and call the state attorney general who fines me for "gouging."

there is not any such thing as gouging, the government and everyone who believes in it is a goddam moron. (not saying you believe in it)

people pay for things or they dont, it is a VOLUNTARY exchange of goods. putting price ceilings on things such as gasoline, wood, generators will create a shortage. because everyone who wants these things at X price, can get them because of a price ceiling. The problem is the supply at price X is usually something like (amount of people wanting good/5) depending on quite a few things.

So now there is a shortage, of gas and wood and everyone is in real deep shit. But the function of high prices are to ration the goods off so that the demand can slowly decrease and catch back up with supply.

price ceiling and gouging are words of idiocy.

I love these threads too, but you're preaching to the choir here.

Let the govt get out and the capital markets will do thier job.

Kelo vs New London and emminent domain is a prefect example of the perversion of markets.  You own the land and have the supply, the big business has the demand, yet instead of operating inside the market they whine to the govt to steal the land for them.  

Some facts gleaned from CNBC lately.
In the early 80s, on average people spent 7% of thier income on energy (gasoline, airline fuel, electricity for thier homes).

Now they spend 5%.  

We consume so many other goods and services that a 50% increase in the cost of pump gas is only a 2% decrease in the amount that can be spent on other consumption.  So this one economist said that long term, gas prices at this level will have minimal effect on consumption.  

Further he cited "how can people afford to put gas in these huge SUVs?  Because they had enough money to buy them in the first place and a 50% increase in gas is still a relatively small amount of thier total income"

Au contraire, according to this thread I am a reptillian monster:

www.ar15.com/forums/topic.html?b=3&f=118&t=252130

G

Guys,

Let's not forget the role of personal responsibility in this system, and it does have a part in our more "modern" times.

Let's take that generator scenario.  We absolutely have the right to tell a vendor to piss off becasue of his high prices.  THAT is the foundation of the free market.  IMO, the reason this high price vendor would get indicted by courts is because the spineless sheeple will scream that they NEED that generator "because it's an emergency and he charges too much!!!"

The lack of preparation on the part of the individual citizen doesn't have squat to do with prices - but our sheeple society makes it so.

The sheeple will scream, "He wouldn't sell me a generator at a price that I can afford!" and other sheeple, not knowing shit about the capaitalist system will cry foul to the courts and politicians.

Ain't it strange how many issues in our society revolve around personal responsibility?

CMOS

You Guys have never had a MicroEcon class before have you?

Quoted: You Guys have never had a MicroEcon class before have you?

If you read my post, I did!

If you live in a hurricane prone area and you wait until AFTER the hurricane to buy canned food, generators and gasoline, then you get to pay the "STUPID TAX" which is equal to the difference between pre-storm and post-storm prices.

I wrote a well-received paper on this for college.  Professor never head of the "STUPID TAX" before, but used it in his subsequent lectures.

Quoted: Quoted: You Guys have never had a MicroEcon class before have you? If you read my post, I did!

you sure did.

YOur ether a prof. for the class or a student right now.

If left alone markets will cure any inbalance.

This whole tax the rich = tax the most productive members of society to help the least productive

Many econ courses dodge the issue by saying its a political matter of how much to tax.

I think there should be a flat tax.  Its fair, no matter how much you make you pay the same amount.  Not fair because poor people spend more of their income on necessities?  Well gee i guess that is motivation to NOT be poor.  Or in other words motivation to be more productive members of society.  Thats one of the principals of economics: People respond to incentives.

The only time the government needs to be involved in econmics is to protect industries vital to the national defense and well being, and to correct imbalances like monopolies etc.  Price caps, price fixing, gouging laws, all need to be throw out the window.

Welfare should be curtailed sharply.  Those that are just "poor" get cheap ration balanced diet type food and water from the government for asistance.  They don't get to go pick what foods they want.  This would lower all the rising health cost with over weight people anyway.  Want to be fat?  Thats motivation to be productive.  I'd also not let them have children unless they are off government assistance.

People that truely have disabilities will obviously be treated better, but not given a free ride.

Its a families responsibility to take care of their own, then maybe the community but not the governments responsibility.

Those are my normative statements for the day

Quoted: Second:  I own a power tool shop.  I have one generator left after a storm.  I want to charge $1,000 and the pre-storm price was $650.  You say you want to pay $650.  I say no, I want a premium because there are very few generators and no more will arrive soon.

Well, you're not going to have one person in there asking to buy a genset, you'll have a line of hundreds.

You sell the last one @ MSRP to the first guy in line, tell everyone else you don't have any more, end of story.

Want to know why?  Because your shop isn't on wheels, it's a B&M in a fixed geographical location. Your customer base is largely drawn from say a 10 mile radius of your store.

 They are on wheels BTW and will use them to drive to the next big box down the road, never to return.

 How are you going to replace them when the sun does start shining again? (It will)

 So, nothing illegal in doing what you did, but in the long run, it's bad business.

Tax is, if anything, more of an economical thing than what it ever could be politically.

Taxing can lead to dead-weight loss in the market = no one buys due to tax being pushed on the consumer, thus no taxes collected, no one will produce due to no demand, prices go nuts, and generally fucks the whole system that was maintaining itself just fine. In a sense, bigger taxes are the parasite that hunts the consumer money instead of light grazing off of it.