That's an easy answer. It is a good PR for them. I don't know if they lose money but they probably make less than they otherwise could.

https://www.cnbc.com/2017/09/11/wal-...f-efforts.html
http://www.washingtonpost.com/wp-dyn...090501598.html
http://abcnews.go.com/WNT/HurricaneR...1171087&page=1

You keep trying to make raising prices out to be something morally dubious. That way of thinking is completely foreign to me. I don't understand it. I would not think twice if someone raised prices. I would welcome it. When Uber raises prices in high demand times that is a good thing. You are advocating a spread the misery mentality where if someone can't have something then no one can.

Raising prices is one thing, being grotesque is another. And, imo, I'm advocating a simple share the wealth/be decent to your fellows approach.

Do you think this approach should be enforced by the power of the state? Because that's the question here.

You have to ration scarce goods somehow in emergencies, or you have a first come, get served, later get charged $1 million/gallon in practice (unobtainable). You can either:

- Restrict the number that people buy (impossible to police)
- Put up the price to reduce excess buying
- Put up the price to encourage and subsidize further abnormal supply.

Which is better? The problem is not gouging, Howard, it's the fact that the selfish public who gets there first buys too much, doesn't look for alternatives, and don't act responsibly. It's the poors that suck, not the rich and the businesses.

'The poors that suck?'

How about 10X for insulin?

Imo there is a different from increasing prices and price gouging. Poor,middle,rich class need to all have compassion. The blame is not just on the business, everyone plays a part in This discussion. It's not all economic and not all compassion. You have to meet somewhere. If someone is dying and needed supplies that I did not really need. Am I going to price gouge him. Of course not. This is not all about economics. It's that people are greedy and selfish. If you want a better society, you change the mentality of everyone for themself mentality. People need to work together. If everyone just got enough and a little more instead of hoarding as much as possible for max profit. People need to learn to share if they have excessive that's the problem with the world. People are more selfish and have less compassion for others. **** I understand making a profit so you have enough but if you have too much share man. I agree with economics when they is scarcity but I also agree with compassion by sharing if you have too much. People are just brainwash by society that max profit is the way to go. I agree profit is good but not max profit.

Many of these people are standing on principle, that bane of rational common sense solutions.

Agreed. The rational common sense thing to do is to allow prices to rise so that the market can supply enough of what they need in times of emergencies.

'Rise' and 'gouge' are two different things as I think I pointed out above. A bit of an 'lol' at 'supply enough' in the middle of what was touted as one of the biggest hurricanes of all time.

Someone's going to say 'supply ahead of time' like what Wal-Mart does and then someone else will say that Wal-Mart loses millions and I say that really fast and efficient supply is impossible under extreme conditions and that we should all try and cooperate and have some consideration, but, nah.

My contention is that gouging doesn't happen when you allow rising.

In the middle? No. But before and right after, sure. People just need to be adequately compensated, and they'll find a way.

I posted this guy before:
When he was allowed to price freely, he used his own initiate, free will and time to provide a desperately needed service that people were willing to pay for, at non-exorbitant prices. This doesn't happen without the price incentive.

Here's where we differ, I think. Your view is that "price gougers are greedy *******s. They must be stopped no matter the consequences". My view is "Most people are greedy *******s, and those that aren't, rarely hugely charitable. Let's turn human greed into a positive and use it to fill human needs, because no one really fills the needs of strangers without greed".

Which proposition is saner?

Interesting how Tooth started this thread with the above logically sound and sensible post responding to a right-winger before realizing this was his opportunity to reach the height of contrarianism and argue against himself for dozens of posts.

I thought about it and I realized I was wrong and I changed my position. Such is the mark of a great man.

In isolation the bolded seems true, but when you look at the totality of effects and expectations, I think the world would look quite different if the free market was given a free hand to deal with disasters. Much better supply at not much worse prices.

It's not greed if both side are happy. it's only greed if just one side is happy.
I definitely agree with price incentives to help fill the void in demand but not to an extreme where you are charging a leg and an arm. Making money is a good thing, overcharging to an extrem is not.

I find myself agreeing with Black Peter in this thread:

A lot of "smart" economists aren't factoring in everything including publicity into their equations of supply and demand. If you price gouge too much (say more than 200% price increase), you are ruining your image in the public eye and lowering future demand and it might end up costing you money long term as the locals decide to go to the gas station down the street for all their future needs since they don't want to support "*******s"

There is a reason big pharma only made small continual raises to the price of their products that had inelastic demand and no substitutes. It's not because Martin Shkreli is way smarter than them.

Ironically you're describing the invisible hand of the free market in this post, so you're kind of arguing against yourself.

The core thesis is that freely floating prices better satisfy human wants than controlled prices. It's shocking that that's even controversial given the mountains of empirical evidence for it.
Big pharma is a consequence of big government artificially limiting supply and putting the cost of research through the roof. Again, you're describing a mechanism in which the free market limits price gouging when it is absent interference.

Actually, I don't think that price gougers must be stopped no matter the consequences. I think that I've come to a reasonable expectation of what human beings will do. What I get a 'kick' out of is the people who say that price gouging is good or that anything against it is stealing or some other twisted view.

And you hopefully know that I greatly respect your opinion and really enjoy it when we disagree.

That would be a rational decision on Walmart's part. They will lose money in a natural disaster to preserve their valuable reputation. It would also be a rational decision for John Nobody to drive down with generators that are desperately needed.

Think of it this way: every time a purchase is made, value is created. When someone exchanges $1000 for a generator on an average day, they are receiving more than $1000 in value for it. Perhaps it's worth $1500 to them, so they've gained $500 in consumer value.

Now imagine you are about to face a monstrous hurricane... Mightn't you value that generator quite a bit more? You might value it as high as $10,000. Getting charged $3000 wouldn't be a gouge, you'd still be acquiring $7000 in consumer value from the purchase, creating a huge benefit to you. The new price incentivizes suppliers to keep supplying as many generators as possible, with the result being that many, many more people can enjoy this $7000 gain in value. If the price has to be maintained at $1000, stock runs out, a few get $9000 in value and the rest get nothing.

Walmart's rational business decision very likely created a much worse outcome for society at large, as others have pointed out: early birds excessively loading up on supplies at too-low prices leads to scarcity of these same valuable supplies later for those who really need and value them and would pay nearly any cost.

Look up "the invisible hand". Buyers and sellers behaving completely selfishly magically results in the most efficient allocation of private goods. This dynamic is practically miraculous in its nature, and is the reason our society has risen from the peat bogs into outer space.

yeah, yeah, yeah.......charge w/e bec everybody's got the money to pay. Something, something, 'value', yada, yada, yada.

Come on man, you seem like a nice guy but take a basic economics course. You don't seem to understand any of what people are plainly explaining to you.

Pretty sure if we learn to share our excess, our society would be in a better situation than now. Completion is good for sure under normal circumstances but when crisis hits, you trying to tell me market base is the best way of help people? I would disagree. There is a different in scalping tickets than overcharging necessities. One is a luxury, one is a matter of life and death. You really think supply and demand matters. It all comes down to greedy people wanting too much and consuming too much because they have the money and giving the scrapes to the poor. Look at America, do you think the income gap right now is good for your country? Less than 1% control the country. Pure capitalism exploits the weak, we need balance. People are just all for themself which is why society is in such a sad state. Come on price gouging when people are suffering. One word compassion.

If everyone just buy what they need and a bit more instead of hoarding the generator to flip it why would it run out? Only reason why it runs out is because people are trying to make a quick profit. That's the problem. People are selfish. Society needs to learn to help each other if someone needs help instead of thinking how I can max profit. I understand it's a long road ahead but maybe one day. Price gouging when people are suffering...karma

I think it is completely meaningless. It only matters to the extent that someone is getting a special privilege from government. Someone else's income is irrelevant to what another has.

Yes.

If you make 30k you are in the top 1% of wage earners in the world. Welfare alone w/ no work pays double the median income of Mexico.

No. It doesn't. It makes the least well off better off. World history shows us this.

What are you talking about? The United States is the most charitable country in the world in both percentage of income given and time volunteering. https://en.wikipedia.org/wiki/World_Giving_Index


Better yet. Compassion and brains.

America is divided, but don't get me wrong there are a lot of good Americans but they is also some bad apples. I don't get what making 30k in America had to do with anything? Is that too much? I am talking about the ultra rich. You really believe pure capitalism doesn't exploit the weak? Sometimes changes are better for the future. This is one of them I think. You trying to tell me that America is not in a sad state right now? Their policy are getting worst and worst. Price gouging is a small problem compare to the big picture but that's another topic.

I am just too kind hearted to not take advantage of people who are not as weathly in tough times. I am not saying do not increase prices but don't do it too rediciously.

Tell me that you're one of these things, PLEASE!
1. An economist.
2. Are in thrall to one of the more austere schools of economic thought.
3. A junior in college.
4. Have all of Ayn Rand's works memorized.
5. Are a member of the House Freedom Caucus.

----------------------------

'Hi, Bill, welcome back to Joe's Supply! Are you looking for anything in particular?
'Yeah, Joe, I think that I'd better get that generator I've been looking at because of the hurricane.'
'That's a real smart idea, Bill, it's always best to be prepared. And you've come at the right time, we only have three left.'
(tick, tock, tick, tock)
'Uh, Bill? There a problem with your credit card. It won't approve the transaction.'
'What? The generator's $1,000 and I know that I've got $1,500 left on the card.'
'Oh, well you see, Bill, the generators are now $3,000.'
'Since when?'
'Since the National Weather Service became certain that the biggest hurricane in history is headed straight for us.'
'What? You've jacked up the price because people really need them now and are willing to pay their last few dollars that they'd been hoping to avoid?'
'It's for the best. You should take a basic economics course.'
'But I've been your customer for years!'
'And I'm happy to see you here today. But the generator's still $3,000 but you should consider that you're getting $7,000 in extra value.'
'But I can't pay that much!'
'You should've taken that into consideration when you were younger. If you were a more productive member of society you'd have the money.'
'You haven't made enough money off of me over the years that you have to try to squeeze me for more? Don't you think you owe me something for being a loyal customer?'
'I'm guessing that you've never read Ayn Rand or any economics books favored by the Cato institute. If you had you'd find that your inability to pay is a function of your laziness and ineptitude.'
'What's 'function' mean in this context? And, by the way, I'm an expert back hoe operator.'
'Sorry, Bill, but I haven't got the time. I notice 3 doctors and 2 lawyers behind you and I DO have to sell these generators before the emergency is over.'
'What am I supposed to do?'
'Get out of that damn back hoe, obviously, and become like these doctors and lawyers. The lawyers especially contribute an enormous amount to society. Well, maybe not these ones because they're criminal defense lawyers but, you know, everyone's entitled to a defense in USA#1.'
(Bill slowly turns, head down, thinking of his wife and three children. He falters a step, then another but, after a few moments, continues on thinking.....)
'If I ever see that Joe's run his car into a tree and it looks like he's about to die I might call an ambulance for him. After a good night's sleep.'

I feel bad for people who value money after they have enough than helping others. Money should not be people's top priority in dire situation.

Just imagine 3 doctors and 2 lawyers already have a generator. But man life would be a lot better if I had 2 or 3.

Beale: again, you don't understand basic economics. Price caps lead to shortages, which means nobody gets a generator, rich or poor or in between. Free market delivers more value to more people every time. Free yourself of emotional reasoning.