Goods Deflation Is Back. It Could Speed Inflation's Return to 2%(wsj.com)
wsj.com
Goods Deflation Is Back. It Could Speed Inflation's Return to 2%
https://www.wsj.com/economy/goods-deflation-is-back-it-could-speed-inflations-return-to-2-c782d434
9 comments
AKA "Companies have to lower prices because consumers aren't buying, because the companies jacked up the prices because they felt they could"
This is how prices work. You charge what you think you can. Not what it costs, or what is fair, or anything else.
Imagine ridiculing someone for asking for a raise “just because they felt they could”.
The market will humble those who misstep, as we are seeing here.
Imagine ridiculing someone for asking for a raise “just because they felt they could”.
The market will humble those who misstep, as we are seeing here.
Usually this is the case, however we are also seeing a lot of Monopoly pricing and Cartels.
https://en.wikipedia.org/wiki/Monopoly_price
Big examples of this include meat packers, hospitals, internet providers, energy companies, and home rentals. Many providers are utilizing technology like YieldStar to create virtualized cartels to engage in price fixing.
https://en.wikipedia.org/wiki/Monopoly_price
Big examples of this include meat packers, hospitals, internet providers, energy companies, and home rentals. Many providers are utilizing technology like YieldStar to create virtualized cartels to engage in price fixing.
Price gouging is the practice of increasing the prices of goods, services, or commodities to a level much higher than is considered reasonable or fair.
The price of a good is determined by what people are willing to pay for it.
I personally think that’s a perfectly reasonable and fair approach.
The cool thing is that if lots of money can be made with a good, supply will increase and people will be able to demand lower prices as a result.
Whereas, if you artificially cap the price of a good, you get a shortage. Always.
I personally think that’s a perfectly reasonable and fair approach.
The cool thing is that if lots of money can be made with a good, supply will increase and people will be able to demand lower prices as a result.
Whereas, if you artificially cap the price of a good, you get a shortage. Always.
"Price gouging" is a term that politicians invented.
It simply does not exist in markets.
It simply does not exist in markets.
These are terms from economics and terms from real life butting heads. The morality of economics is all over the place, so a moral judgement such as whether a price is "fair" or "just" of course will not make sense in economics. That doesn't mean the concept is novel, unusual, or unreasonable, it's just not expressed through the medium of economics. The idea of price gouging is as old as society itself. We have found evidence of price gouging in mesopotamia (Ea Nasir memes being popular examples), so the idea that politicians invented the idea of using control of prices in a cruel or unfair way is silly. Just because we're talking about the economy doesn't mean ideas outside of economics aren't relevant.