If you ever decide on some more tags, I think “gouging” would be a good one. The “prices” tag helps, but as someone who often writes (informally, mostly on web forums and blogs) in defense of [so-called] “gouging,” I would find a tag like that especially helpful.
louhAugust 17, 2009 at 8:10 pm
The age old question on how to price a commodity will forever be argued. Pricing based on embeded labor, or on supply and demand, either present or future. Too many politicians refuse to see the need to price based on future expectations. Probably explains why most politicians couldn’t make a buck in the stock market if their lives depended on it.
AnonymousAugust 17, 2009 at 10:57 pm
Actually this is not true at all, Congress and its friends do very well in the stock market, thank you.
As a matter of fact they consistently outperform you by a sizable margin, say 25% better on average.
Why, because insider trading is legal for them and those they share the information with…………oh how sweet it is!
This blog’s resident investment insider, Methinks, checked out the percentages and confirmed that they could only come from insider trading, then we found these sites…….oh how sweet it is!
Jake S.August 18, 2009 at 1:17 am
It may be an age-old question, but it was answered pretty definitively back in 1544:
“Those who gauge the just price of an article by the labor, costs, and risks borne by the person who deals in or produces the merchandise are seriously mistaken; for the just price springs from the abundance or lack of goods, merchants, or money, and not from costs, labor, and risks.” — Saravia de la Calle (quoted in Jesus Huerta de Soto’s “The Austrian School: Market Order and Entrepreneurial Creativity)
and again in 1555:
“The value of an article does not depend on its objective nature but on the subjective estimate of men, even when this estimate is foolish.” — Diego de Covarrubias y Leyva (Ibid.)
AnonymousAugust 18, 2009 at 3:50 am
Great quotes.
AnonymousAugust 18, 2009 at 4:13 am
“age old question on how to price a commodity”
I guess some definitively answered questions continue to be asked, and remain mysterious to some.
There is no formula for determining the correct or best or fair price. There is only the price range between the lowest for the seller and the highest for the buyer. The need for seller net profit and buyer’s limited means are only outer objective constraints upon the major determinant, which is personal subjective value. And that changes for an individual from year to year, sometimes from second to second. Even the fact of marginal value only tells us qualitatively how unit values change with quantity.
This is a major reason by valuations imposed by central planners are ALWAYS ALWAYS ALWAYS inefficient. The value or small set of values determined by the planner CANNOT match the millions of determined dynamic true values perceived by the individuals whose resources are being traded. The central planner’s valuations massively mismatch the valuations of the trading parties. Central planners don’t even have an incentive to TRY to get those valuations correct even if they misperceived that it were possible.
AnonymousAugust 18, 2009 at 9:37 am
In Europe the gasoline price is about 6$/gallon, currently. Petrol is 7,50$… Of this, more than half is tax. This reduces demand, which has the ironic consequence that the price for the stuff across the Atlantic is (much) lower.
So cheap oil addicts, keep on praying for socialist taxes, elsewhere.
Share
{ 7 comments }
If you ever decide on some more tags, I think “gouging” would be a good one. The “prices” tag helps, but as someone who often writes (informally, mostly on web forums and blogs) in defense of [so-called] “gouging,” I would find a tag like that especially helpful.
The age old question on how to price a commodity will forever be argued. Pricing based on embeded labor, or on supply and demand, either present or future. Too many politicians refuse to see the need to price based on future expectations. Probably explains why most politicians couldn’t make a buck in the stock market if their lives depended on it.
Actually this is not true at all, Congress and its friends do very well in the stock market, thank you.
As a matter of fact they consistently outperform you by a sizable margin, say 25% better on average.
Why, because insider trading is legal for them and those they share the information with…………oh how sweet it is!
http://www.securitiesdocket.com/2009/03/11/closing-the-congressional-insider-trading-loophole/
http://www.goupstate.com/article/20090716/ARTICLES/907161007?Title=Congressional-insider-trading
This blog’s resident investment insider, Methinks, checked out the percentages and confirmed that they could only come from insider trading, then we found these sites…….oh how sweet it is!
It may be an age-old question, but it was answered pretty definitively back in 1544:
“Those who gauge the just price of an article by the labor, costs, and risks borne by the person who deals in or produces the merchandise are seriously mistaken; for the just price springs from the abundance or lack of goods, merchants, or money, and not from costs, labor, and risks.” — Saravia de la Calle (quoted in Jesus Huerta de Soto’s “The Austrian School: Market Order and Entrepreneurial Creativity)
and again in 1555:
“The value of an article does not depend on its objective nature but on the subjective estimate of men, even when this estimate is foolish.” — Diego de Covarrubias y Leyva (Ibid.)
Great quotes.
“age old question on how to price a commodity”
I guess some definitively answered questions continue to be asked, and remain mysterious to some.
There is no formula for determining the correct or best or fair price. There is only the price range between the lowest for the seller and the highest for the buyer. The need for seller net profit and buyer’s limited means are only outer objective constraints upon the major determinant, which is personal subjective value. And that changes for an individual from year to year, sometimes from second to second. Even the fact of marginal value only tells us qualitatively how unit values change with quantity.
This is a major reason by valuations imposed by central planners are ALWAYS ALWAYS ALWAYS inefficient. The value or small set of values determined by the planner CANNOT match the millions of determined dynamic true values perceived by the individuals whose resources are being traded. The central planner’s valuations massively mismatch the valuations of the trading parties. Central planners don’t even have an incentive to TRY to get those valuations correct even if they misperceived that it were possible.
In Europe the gasoline price is about 6$/gallon, currently. Petrol is 7,50$… Of this, more than half is tax. This reduces demand, which has the ironic consequence that the price for the stuff across the Atlantic is (much) lower.
So cheap oil addicts, keep on praying for socialist taxes, elsewhere.