Channeling a mix of Charles McKay and Yogi Berra, it is Extraordinary Popular Delusions And The Madness Of Crowds all over again.Dadtodabone wrote:At that point well have a "Tulip" market.
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Return to “Effects of ammo shortages”
- Sat Mar 30, 2013 5:13 pm
- Forum: General Gun, Shooting & Equipment Discussion
- Topic: Effects of ammo shortages
- Replies: 50
- Views: 7247
Re: Effects of ammo shortages
- Sat Mar 30, 2013 4:03 pm
- Forum: General Gun, Shooting & Equipment Discussion
- Topic: Effects of ammo shortages
- Replies: 50
- Views: 7247
Re: Effects of ammo shortages
I have no problem with stores charging high prices and I do not consider it gouging.
Price is the most effective mechanism to balance supply and demand. The demand has gone through the roof, outstripping supply, so the only way to clear the market is the have the price reduce demand.
If a market cannot or does not use price to balance the market, then the only alternative is rationing. We see that too, obviously, with the long lines at Walmart and Academy. But even rationing is not effective over the long haul because as long as there is a price differential between what someone can buy it at Walmart and sell it elsewhere, then that behavior will continue.
It is called market arbitraging, and is a huge reason that free markets are more efficient.
From a business standpoint, Walmart/Academy and others who have not chosen to raise their prices to market levels have decided their brand value is worth more than the temporary profits. But make no mistake about it, those temporary profits are being realized by a lot of people who buy at those stores for resale purposes. I am glad they are doing so. The more efficient the market operates the quicker we can get back into balance.
The only effect the shortage has had on me is I have decided to continue using my self defense ammo a little longer instead of shooting it off and replacing it. I reload my range ammo and it has had no impact on me since I have adequate supplies.
Price is the most effective mechanism to balance supply and demand. The demand has gone through the roof, outstripping supply, so the only way to clear the market is the have the price reduce demand.
If a market cannot or does not use price to balance the market, then the only alternative is rationing. We see that too, obviously, with the long lines at Walmart and Academy. But even rationing is not effective over the long haul because as long as there is a price differential between what someone can buy it at Walmart and sell it elsewhere, then that behavior will continue.
It is called market arbitraging, and is a huge reason that free markets are more efficient.
From a business standpoint, Walmart/Academy and others who have not chosen to raise their prices to market levels have decided their brand value is worth more than the temporary profits. But make no mistake about it, those temporary profits are being realized by a lot of people who buy at those stores for resale purposes. I am glad they are doing so. The more efficient the market operates the quicker we can get back into balance.
The only effect the shortage has had on me is I have decided to continue using my self defense ammo a little longer instead of shooting it off and replacing it. I reload my range ammo and it has had no impact on me since I have adequate supplies.