That way. . . stupid blogs like this can keep going forward.

What if someone set up a non for profit charitable foundation that anyone could call ( or have some sort of automatic arrangement) where if price competition failed to eliminate these "short term emergency monopolies" and a mark up of over say, that threshold 50% was observed, then foundation would agree to pay the difference above the short term monopoly level and keep it from going any higher.

Companies that repeatedly bleed the foundation would get bad press, the consumer would have some insulation from any short term monopoly , competition would be given first shot at solving the problem, and the supplier would have insulation from legal action against it.

I believe you missed the discussion on the effect that prices have on human behavior. When gas hit $4 a gallon at the beggining of the year, society started changing their consumption patterns. We saw the number of people traveling out of state largely decreased, as well as seeing more individuals going towards public transportation.

Do you think the individuals you listed in your example would have purchased the same quantity had prices increased drastically probably not. In terms of profiteering, there's nothing wrong with making a profit, if and when you are providing the service for which you are being paid for.

I believe Russ stated and I quote,

"Prices are rising. Just not enough."

to actually alter the demand for it (gas).

If you had read the example I gave, it displayed why high gas prices are actually more beneficial, than the current price gouging laws in place. You claim nobody read your post, but apparently you didn't read anybody elses post as well.

First, Big Oil says "all our refineries could be destroyed." Then media hype and so-called experts predict doom-and-gloom. Like frenzied sharks after blood in the water, everyone rushes to buy gas as if this is the last chance they'll get! In one article I read, a lady was filling up five cars! In another case, a man filled up his car and was filling 3 gas cans. He wasn't in a storm zone, so he didn't have any higher risk for needing a generator than the day before.

As a result, prices went up. This self-fulfilling prophecy became like chum for the gas sharks so we end up with lines and stations out of gas. There are only so many delivery trucks in an area. When excessive demand outstrips delivery capability, it's no surprise. But, that serves to ratchet up the hysteria some more.

Most areas have adequate supply of gasoline on hand. But, the hoarding over the weekend has reduced inventory. With less production capacity on line for at least several days, there will be less gasoline flowing. As a result of stupid, selfish people, a short-term price hike will be with us for a much longer time until things return to normal. Since OPEC is reducing production, we've probably been robbed of any dividend from $100/barrel crude. The price is going back up once the refineries are back on line.

I seriously doubt anti-gouging laws had much to do with pricing. Gouging requires a declared state of emergency, so that doesn't apply in most places. Initial raises were normal supply-and-demand economics. Excessive hikes and wide differences between stations in the same area suggest profiteering to me. Yes, SteveO, some people are like that.

You are suffering from the dellusion of engineering; that any solution is a designed one, either binary choice A or binary choice B.

What Russ is saying is that as the price continues to rise, the large aggragate of people who want (at various levels) to buy gass, will have increasing reasons to determine their own needs weighed against their own costs.

This is an organic solution. Neither a full pump with an infinite price tag, nor a low price with an empty tank. But an organic system where people continue to make new decisions based on changing ratios of cost and benefit.

He keep claiming that a gas station running out of gas is the worse thing that can happen.

Can someone explain to me why we are better off after an interruption in supply for the remaining supply to be left at the tank in the gas station rather than being pumped into someone's care so that can have transportation?

As support for his argument he cited two stations that raised their prices from $3.50 to $5.00 and $7.00.

Please explain to me how a station raising its prices by 100% is evidence that stations are not raising prices.

Everyone is talking about gas prices raising sharply.

I agree that prices are up sharply.

Except, I'm on vacation. Over the last couple of days I watched gas prices rise sharply in Atlanta. But yesterday as I was driving from Atlanta from Charleson about 50 miles east of atlanta I bought gas at $4.23 per gal.

The only person on this blog who is claiming gas prices are not going up is our good host.

Go back and read what he said. He said that gas stations were running out of gasoline because anti-gouging laws prevented them from raining prices.

All I pointed out is that he is completely wrong.

The only person on this blog who is claiming that anti-gouging laws are preventing gas stations from raising prices is Russ. Everyone else agrees that gas prices are risising.
Everyone else, including me and the article Russ cited says gas prices are rising.

Why are you jumping on me for saying gas prices are rising when Russ is the only one claiming that gas prices are not rising.

He is the only one off in some fantasy world that has no basis in reality.

I guess that is why he had to written his fantasy book about shortage in an natural disaster because he could not find in real world example to support his theories.

I said gas prices are rising.
Russ said they were not rising.

Why are your jumping on me when Russ is the one who is completely wrong?

Prices are rising significantly, but people seem insensitive to the changes. They're still lining up around the block. Apparently they think this is the last time they'll ever be able to buy gas.

In reality we still have just as much gasoline as before. But now, instead of being stored in underground tanks, it's in a million people's gas tanks.

This is the problem with just-in-time inventory management; when people suddenly decide to increase their stocks, we have capacity problems. Even if our area imports and consumes gasoline at the exact same rate, people will still have the impression that we're out of the stuff.

A McMinnville, Tennessee station was the subject of the second suit after it charged $7.00 a gallon for gasoline. The posted price was $3.50, but gasoline pumps had notes on them saying "Doubled," which most consumers missed until after they had filled their tanks.

It should, though, be dealt with as unclear labelling, not "gouging".

The station manager didn't provide a reason for the sudden increase, except to note that he would have to pay $5.32 a gallon for his next shipment.

Sounds like a reason to me. Where is he getting the $5.32 a gallon for the next shipment?

I spent a lot of time living in the Boston area, and I encountered the occasional tail end of a hurricane (more like a strong wind by the time it got there) as well as some major snowstorms.

Inevitably "everyone" would rush to the stores and buy batteries (we bunkered down instead of running away from storms. The "hurricanes may have knocked out power, but weren't really threatening, while the major snowstorms left nowhere to run to), amongst other things. Often batteries would run out as all kinds of people suddenly stocked up on batteries. This is with batteries at the "old" quasifixed price, not at a "price gouging" price.

Now imagine what would happen if everyone knew that prices would soar in the event of a storm. Batteries have a pretty long shelf life, so many people would buy them in advance of any storm warnings while they could buy them cheap. Some of them might even buy more than they need, to sell to others when the storm approached, or to give them to their friends. (I still remember the "blizzard of '78" when the parents of one of my friends offered to give my mother some bread after everyone had been snowed in for several days and the local roads were still largely impassable. I thought this was quite generous, although I later realized that bread had a shelf life of only so long….)

In addition to what I outlined, what happens when farsighted individuals buy batteries (or candles, with a shelf life of "forever", if less convenient for reading or finding ones way around in the house) in far enough in advance (weeks or months) of a storm is that the stores restock, and thus have fewer customers to sell them to during a storm, thus being less likely to run out. Also the higher prices discourage people from buying too many batteries during a panicked shopping blitz from carelessness.

The same arguments apply to other emergency "neccessities", such as bottled water, canned goods, spare shovels (so that everyone in the family can help shovel, even the kids who might actually like it), perhaps some propane, gasoline—especially at gas stations located at lesser traveled roads that are less likely to run out, etc.

Which is uglier, price gouging which results in more needs being met, or anti-price gouging laws which result in far more shortages than otherwise would have been the case if not for government meddling?

P.S. Spencer, just becuase there are laws against retail price gouging doesn't mean that wholesalers (i.e. refineries) are covered by them, and therefore retailers simply must raise their prices anyway.

Obviously, Tina Turner is causing massive global warming which is destroying our coastal cities via big oil, driving up the cost of gas.

Ever since graduating with my degree in Economics, in a very austrian leaning program, I have found myself being asked about economic issues like Freddie-Fannie, free trade, energy, fuel standards and other items. Almost always, I will indepedently offer an assesment and later on find that a bunch of strongly market oriented economists will write articles that say what I said, more or less point for point.

Either I have been very much enlightened by my educate and have a fairly good understanding of Economics or I have been thoroughly indoctrinated. Fortunately, most empirical evidence points to the former.