Economics: The Value of "Price Gouging"

[Speaker to Animals]

In other words, the libertarian fantasy is that they can fuck people over in a stateless society without getting shot in the face. Which is ridiculous.

Libertarians, like all liberals, live in a world of contradictions: I want a society without a state imposing violence and laws upon us!; I want a society where I can horde water and charge people their daughter's virginity!

Liberals never think this shit through. The only way you can get away with price gouging at all is because there presumably exists an army and police force willing to defend you from the people who would otherwise shoot you in the face to survive.

[DBTrek]

When does the natural result of the supply/demand curve officially hit “price gouging” and who gets to make that call?

I risk life and limb to rush 100 electric blankets into Chicago, driving all night over icy roads, taking risks to arrive with a speed that FEMA and the rest of the government would never attemp. I get there two days before the government will be delivering shit to anyone.

Five hundred people need blankets. I don’t have 500. I have 100. Ok ... so we auction them eBay style, highest bid gets the first, next highest the second, and so on. This prevents the first person in line from simply buying them all, which they might do if the price were fixed artificially low.

How high does that first bid have to be to make the natural operation of the supply/demand curve qualify as “price gouging”?

And if you legislate that electric blankets can’t be sold for anything more than “normal” prices, what happens when the first ten people by ten blankets apiece and the other 490 are ass-out in the cold?

Dumb.

Price gouging is fiction. It’s silly speak for “I don’t understand economics, but I’ve appointed myself as god of fairness so we’re distributing goods on first-come first serve basis”. Not only do you disincentivize anyone from rushing goods to an area in need, you promote over-consumption. Dumb, dumb, dumb.

[Speaker to Animals]

When does the natural result of the supply/demand curve officially hit “price gouging” and who gets to make that call?

Well, for one thing, price gouging implies that the people engaging in it are able to artificially restrict supply enough, and collude, to demand those prices.

If supply of something is naturally low, then prices are going to be high and nobody is going to call that price gouging.

But when you legalize price gouging, you create conditions whereby people can artificially restrict supply and gouge. This is how cornering a market works.

For instance, say in the wake of Katrina, a group of people decides to buy all the potable water people are selling. Now they are sitting on most of the water. They can charge a very high price and only hand out a small portion of the water, but make a much higher profit. Price gouging actually results in scarcity. It doesn't solve it at all.

[Martin Hash]

You know it’s not gouging when you make good money but don’t worry about getting shot in the face.

[Speaker to Animals]

The common silly argument I hear from libertarian retards is that price gouging will incentivize people to bring water into the region and sell it at a lower price to compete. All that's going to happen is that the price gougers are going to purchase the water brought in and stash it away so they can continue to corner the market and gouge people.

This libertarian (liberal) bullshit is always ass backwards. Same as ever.

The irony of these people is that they never seem to actually understand markets and human psychology at all. I shouldn't even have to explain this to them. It's self-evident. Duh..

[DBTrek]

How are the potable water hoarders able to prevent anyone else from entering Louisiana with pallets of water to sell? Seems like you need government intervention to enforce a monopoly.

[Speaker to Animals]

How are the potable water hoarders able to prevent anyone else from entering Louisiana with pallets of water to sell?

Oh my Jesus.

All they have to do is buy the water.

[DBTrek]

You know it’s not gouging when you make good money but don’t worry about getting shot in the face.

So everyone selling anything in Chicago is price gouging, I guess.

[Speaker to Animals]

You know it’s not gouging when you make good money but don’t worry about getting shot in the face.

So everyone selling anything in Chicago is price gouging, I guess.

LOL, what??

[Speaker to Animals]

You used the term supply and demand curve (they are two curves, but whatever). Do you not understand what that implies??

If you can restrict supply you can raise prices as high as you want. That's what price gouging is.

It's not charging a high price because supply is already restricted by a natural disaster, but because people are purposely setting shit aside. You can't price gouge if there are lots of other sellers to compete with. You have to first buy up all their supply and put that shit into storage.

Price gouging implies people are taking critical resources off the market in order to fleece people.

Which is pretty fucking bad in a disaster. That's why we criminalized it. If you want less water in a disaster, by all means decriminalize price gouging. That's exactly what you will get if anybody figures out how to corner the market.