Page 2 of 5 FirstFirst 1234 ... LastLast
Results 21 to 40 of 91

Thread: Price gouging

  1. #21
    All Pro
    Join Date
    Sep 2007
    Location
    Wildcat Country
    Posts
    5,102
    [QUOTE=BrooklynBound;2831869]Why should democracy degrade property rights? I own something, and you do not have the right to take it from me at a price that you want. It's not about might, it's about property rights.

    What if land was scarce and the people wanted to knock down your house so that a high-rise apartment could be built and more people could live there. The people who want your land and house don't have the money to pay you market value, but they REALLY, REALLY need it. After all, housing is essential. So you'll have to accept a price that they think is fair. How would you feel about that?

    And how would your example even come to fruition? Why would I rather have you die than sell it to you? I'd rather sell it to you. Maybe you'd rather pay less, but I'd rather pay less for everything. I wish was my food bill cost $1.

    Also, using your example, anyone who doesn't sell food to the poor/homeless at low prices that they can afford are "price gougers." They go hungry every day because they don't have the money to buy essentials.[/QUOTE]

    Obviously there's a balance to be struck. Take my position too far and, like you say, vendors are forced to sell at prices even the homeless can afford and then you destroy incentive and the free market. Take your position too far and we would still be living under kings and barons who would never relinquish their power to charge what they want society be damned.

    I don't have the perfect answer. Wish I did. All I know for sure is that the debate over the rights of the individual vs. the greater good of the community will still be going on long after we're pushing up daisies.

    I do believe though that laws against price gouging for certain key commodities (grains and fuel among them) are generally more useful than they are harmful. If we believe (as we seem to) that consumer spending is the engine that drives our economy, then letting a few key players who dominate these commodities pursue prices to the point where they undermine consumer spending then we're favoring a few individuals at the expense of 99.9% of the population.
    Last edited by BushyTheBeaver; 10-30-2008 at 02:13 AM.

  2. #22
    [QUOTE=BushyTheBeaver;2831880]Obviously there's a balance to be struck. Take my position too far and, like you say, vendors are forced to sell at prices even the homeless can afford and then you destroy incentive and the free market. Take your position too far and we would still be living under kings and barons who would never relinquish their power to charge what they want society be damned.[/quote]

    Why would the vendors be be forced to do anything? They can sell their product for as much as they like, but no more than the market will bear.

    The homeless can't afford much, so how can selling them something they can afford bring down the system? How would this destroy incentive? We're in trouble if our economy depends on homeless people.

    And this isn't comparable to kings and barons. Kings and barons rule by force. Vendors don't. No one is forcing you to buy their goods or services.

    [quote]
    I don't have the perfect answer. Wish I did. All I know for sure is that the debate over the rights of the individual vs. the greater good of the community will still be going on long after we're pushing up daisies.

    I do believe though that laws against price gouging for certain key commodities (grains and fuel among them) are generally more useful than they are harmful. If we believe (as we seem to) that consumer spending is the engine that drives our economy, then letting a few key players who dominate these commodities pursue prices to the point where they undermine consumer spending then we're favoring a few individuals at the expense of 99.9% of the population.[/QUOTE]
    Price gouging laws are harmful. Often, the police will enforce the laws DURING the extraordinary time, which shuts the vendor down and takes supply off of the market.

    The ironic thing is that higher prices increase supply by making it more attractive to sell. It also promotes rationing and discourages wasteful consumption. This is useful when supply is low.

    I disagree that we should have consumer spending drive the economy. Real savings that creates capital investment is valuable.

  3. #23
    [QUOTE=BushyTheBeaver;2831800]

    As to what level of profit actually constitutes price gouging I can't say, but like pornography, you know it when you see it. Take the gas station owner whose tanks are full of gas he paid $2.50 a gallon for but when oil prices spike he raises the price of that gas to $5.00. Or take a supermarket that raises the price of food just before a hurricane.[/QUOTE]

    Raising prices before a hurricane can protect against hording.

  4. #24
    Jets Insider VIP
    Join Date
    Sep 2005
    Location
    New York, NY
    Posts
    13,566
    [QUOTE=BushyTheBeaver;2831827]Absolutely disagree. Where is your Christianity (or if you're a humanist, your humanity)? In the year preceding the French revolution, with people in Paris starving to death in the streets, grain speculators actually sank ships full of grain to keep the prices high and increase their profits. Your Ramen noodle analogy is a "let them eat cake" non-sequitor. As for the "even douche bags have rights" argument, well then, the people you're douching equally have have the right to kill you. After all, you're killing them. (Understand, I'm talking a life/death scenario of price gouging, not charging an extra 50 cents at the pump).[/QUOTE]

    Listen, I'm not saying that I would personally make that decision. As a Christian and hopefully a good person, I'd help my neighbors.

    But are you implying we should force those Christian ideals on everyone? That is complete insanity, and goes against one of the biggest things this country was built on - religious freedom.

    And the total hypocrisy of this post is this - even if "price gouging" were the equivalent of killing (which it isn't even remotely close to), what happened to your Christian ideal of "turn the other cheek"?

  5. #25
    The best way to look up the definition of price gouging is to look at the law -- these usually contain definitions: Here is a summary of what most jurisdictions consider Price Gouging:

    Many states have enacted some type of prohibition or limitation on price increases during declared emergencies. Generally, these laws prohibit the sale of goods and services in the designated emergency area at prices that exceed the prices ordinarily charged for comparable goods or services in the same market area at or immediately before the declaration of an emergency. However, many statutes include an exemption if the increased prices are the result of increased costs incurred for procuring the goods
    or services in question.

  6. #26
    Jets Insider VIP
    Join Date
    Feb 2006
    Location
    Van down by the river
    Posts
    23,194
    [QUOTE=Guido Monzino;2831963]But are you implying we should force those Christian ideals on everyone? That is complete insanity, and goes against one of the biggest things this country was built on - religious freedom.
    [/QUOTE]

    Doesn't stop those Christian idiots from trying though, does it?

    :P

  7. #27
    [QUOTE=fukushimajin;2832204]The best way to look up the definition of price gouging is to look at the law -- these usually contain definitions: Here is a summary of what most jurisdictions consider Price Gouging:

    Many states have enacted some type of prohibition or limitation on price increases during declared emergencies. Generally, these laws prohibit the sale of goods and services in the designated emergency area at prices that exceed the prices ordinarily charged for comparable goods or services in the same market area at or immediately before the declaration of an emergency. However, many statutes include an exemption if the increased prices are the result of increased costs incurred for procuring the goods
    or services in question.[/QUOTE]
    So most price gouging laws have specific price increase limits? Is it by a percentage or what? One of the many problems with gouging laws is that they are vague.

  8. #28
    Veteran
    Join Date
    Apr 2003
    Location
    Greenwich Village, NY
    Posts
    2,243
    [QUOTE=jetstream23;2831786]How would the vendor know?

    Well, I'd say that if the price is raised on essential goods like food, water, fuel, etc. in direct association to a specific emergency or disaster that is price gouging.

    If profit margins are being maintained (i.e. the producer prices have gone up such that the cost to the local market is higher) than that probably isn't price gouging. But, if the super market usually pays Dasani $0.82 for a bottle and sells it for $0.99, then raises the price to $10 without an associated increase in the $0.82 cost then I'd be a little suspicious.[/QUOTE]
    the problem with this logic is as follows.

    If we were out of water for some indefinite period of time (or even a definite period of time,) people would hoard water for future use. In fact, in your scenario where price does not increase, people have no incentive to cut their consumption of water in would hoard water and use it inefficiently. Only the first few customers who went to the store to get water would have access to it since the local supply would run out as the stores inventory would be depleted.

    Price is a very efficient tool to make sure resources are directed to their most productive/essential uses

  9. #29
    [QUOTE=BrooklynBound;2832215]So most price gouging laws have specific price increase limits? Is it by a percentage or what? One of the many problems with gouging laws is that they are vague.[/QUOTE]

    No -- as a general proposition they don't. However, specific products do include limits -- milk for example sets the limit at 200%.

    Here is the New York General Business Law on Price Gouging:
    [SIZE="2"][SIZE="1"]
    In order to prevent any party within the chain of distribution of any consumer goods from taking unfair advantage of consumers during abnormal disruptions of the market, the legislature declares that the public interest requires that such conduct be prohibited and made subject to civil penalties.

    2. During any abnormal disruption of the market for consumer goods and services vital and necessary for the health, safety and welfare of consumers, no party within the chain of distribution of such consumer goods or services or both shall sell or offer to sell any such goods or services or both for an amount which represents an unconscionably excessive price. For purposes of this section, the phrase “abnormal disruption of the market” shall mean any change in the market, whether actual or imminently threatened, resulting from stress of weather, convulsion of nature, failure or shortage of electric power or other source of energy, strike, civil disorder, war, military action, national or local emergency, or other cause of an abnormal disruption of the market which results in the declaration of a state of emergency by the governor. For the purposes of this section, the term consumer goods and services shall mean those used, bought or rendered primarily for personal, family or household purposes. This prohibition shall apply to all parties within the chain of distribution, including any manufacturer, supplier, wholesaler, distributor or retail seller of consumer goods or services or both sold by one party to another when the product sold was located in the state prior to the sale. Consumer goods and services shall also include any repairs made by any party within the chain of distribution of consumer goods on an emergency basis as a result of such abnormal disruption of the market.

    3. Whether a price is unconscionably excessive is a question of law for the court.

    (a) [B]The court's determination that a violation of this section has occurred shall be based on any of the following factors: (i) that the amount of the excess in price is unconscionably extreme; or (ii) that there was an exercise of unfair leverage or unconscionable means; or (iii) a combination of both factors in subparagraphs (i) and (ii) of this paragraph.
    [/B]
    (b) In any proceeding commenced pursuant to subdivision four of this section, prima facie proof that a violation of this section has occurred shall include evidence that

    (i) the amount charged represents a gross disparity between the price of the goods or services which were the subject of the transaction and their value measured by the price at which such consumer goods or services were sold or offered for sale by the defendant in the usual course of business immediately prior to the onset of the abnormal disruption of the market or

    (ii) the amount charged grossly exceeded the price at which the same or similar goods or services were readily obtainable by other consumers in the trade area. A defendant may rebut a prima facie case with evidence that additional costs not within the control of the defendant were imposed on the defendant for the goods or services.

    4. Where a violation of this section is alleged to have occurred, the attorney general may apply in the name of the People of the State of New York to the supreme court of the State of New York within the judicial district in which such violations are alleged to have occurred, on notice of five days, for an order enjoining or restraining commission or continuance of the alleged unlawful acts. In any such proceeding, the court shall impose a civil penalty in an amount not to exceed twenty-five thousand dollars and, where appropriate, order restitution to aggrieved consumers.[/SIZE][/SIZE]

  10. #30
    [QUOTE=fukushimajin;2832232]No -- as a general proposition they don't. However, specific products do include limits -- milk for example sets the limit at 200%.

    Here is the New York General Business Law on Price Gouging:
    [SIZE="2"][SIZE="1"]
    In order to prevent any party within the chain of distribution of any consumer goods from taking unfair advantage of consumers during abnormal disruptions of the market, the legislature declares that the public interest requires that such conduct be prohibited and made subject to civil penalties.

    2. During any abnormal disruption of the market for consumer goods and services vital and necessary for the health, safety and welfare of consumers, no party within the chain of distribution of such consumer goods or services or both shall sell or offer to sell any such goods or services or both for an amount which represents an unconscionably excessive price. For purposes of this section, the phrase “abnormal disruption of the market” shall mean any change in the market, whether actual or imminently threatened, resulting from stress of weather, convulsion of nature, failure or shortage of electric power or other source of energy, strike, civil disorder, war, military action, national or local emergency, or other cause of an abnormal disruption of the market which results in the declaration of a state of emergency by the governor. For the purposes of this section, the term consumer goods and services shall mean those used, bought or rendered primarily for personal, family or household purposes. This prohibition shall apply to all parties within the chain of distribution, including any manufacturer, supplier, wholesaler, distributor or retail seller of consumer goods or services or both sold by one party to another when the product sold was located in the state prior to the sale. Consumer goods and services shall also include any repairs made by any party within the chain of distribution of consumer goods on an emergency basis as a result of such abnormal disruption of the market.

    3. Whether a price is unconscionably excessive is a question of law for the court.

    (a) [B]The court's determination that a violation of this section has occurred shall be based on any of the following factors: (i) that the amount of the excess in price is unconscionably extreme; or (ii) that there was an exercise of unfair leverage or unconscionable means; or (iii) a combination of both factors in subparagraphs (i) and (ii) of this paragraph.
    [/B]
    (b) In any proceeding commenced pursuant to subdivision four of this section, prima facie proof that a violation of this section has occurred shall include evidence that

    (i) the amount charged represents a gross disparity between the price of the goods or services which were the subject of the transaction and their value measured by the price at which such consumer goods or services were sold or offered for sale by the defendant in the usual course of business immediately prior to the onset of the abnormal disruption of the market or

    (ii) the amount charged grossly exceeded the price at which the same or similar goods or services were readily obtainable by other consumers in the trade area. A defendant may rebut a prima facie case with evidence that additional costs not within the control of the defendant were imposed on the defendant for the goods or services.

    4. Where a violation of this section is alleged to have occurred, the attorney general may apply in the name of the People of the State of New York to the supreme court of the State of New York within the judicial district in which such violations are alleged to have occurred, on notice of five days, for an order enjoining or restraining commission or continuance of the alleged unlawful acts. In any such proceeding, the court shall impose a civil penalty in an amount not to exceed twenty-five thousand dollars and, where appropriate, order restitution to aggrieved consumers.[/SIZE][/SIZE][/QUOTE]

    Where are you getting 200% from? Also, regarding milk, we don’t need milk to survive.

    The part you bolded is, as I expected, vague. How does one define “unconscionably extreme”? How does one define “unfair leverage” or “unconscionable means?”

  11. #31
    [QUOTE=BrooklynBound;2832245]Where are you getting 200% from? Also, regarding milk, we don’t need milk to survive.

    The part you bolded is, as I expected, vague. How does one define “unconscionably extreme”? How does one define “unfair leverage” or “unconscionable means?”[/QUOTE]

    Heh, I knew you'd ask that question. I bolded that part because, as a prosecutor, that is the standard you would have to meet in order to charge someone with the violation. The best way to define "unconscionable" in the legal context is "an occurrence that shocks the conscience" -- more words, I know. However, this isn't really as vague as it seems -- the real guide is precedent. Over the years, every time a case of gouging is tried and appealed the courts essentially "set the floor" of what size of price increase and circumstances that would be needed to find guilt. This generally doesn't vary much and almost always a case of gouging is entirely obvious to all concerned.

    Also, there is no need for the product to be absolutely required for survival -- people are weird about milk because of the tradition of feeding it to babies/kids.

    The 200% thing is from a different section of the law rr(2) -- do you want me to post a section that has a percent based standard?

  12. #32
    Jets Insider VIP
    Join Date
    Feb 2006
    Location
    Van down by the river
    Posts
    23,194
    [QUOTE=BrooklynBound;2832245]Also, regarding milk, we don’t need milk to survive. [/QUOTE]

    Speak for yourself, Mr. Person Who Obviously Has No Kids Yet...;)

    [IMG]http://www.wee-baby.com/v/vspfiles/assets/images/wee%20hat%20on%20baby%20blue-1.jpg[/IMG]

  13. #33
    [QUOTE=PlumberKhan;2832325]Speak for yourself, Mr. Person Who Obviously Has No Kids Yet...;)

    [IMG]http://www.wee-baby.com/v/vspfiles/assets/images/wee%20hat%20on%20baby%20blue-1.jpg[/IMG][/QUOTE]

    Fair enough. But letting prices go up will help reduce the effect of people who people who buy milk to dunk their oreos when milk is scarce. There will be more milk available for those who want to use it for their children. If prices are kept artificially low, there’s incentive for the vendor to hoard and for the customer to use more than they need. Not only are gouging laws unclear and unfair, they hurt consumers.

  14. #34
    [QUOTE=fukushimajin;2832310]Heh, I knew you'd ask that question. I bolded that part because, as a prosecutor, that is the standard you would have to meet in order to charge someone with the violation. The best way to define "unconscionable" in the legal context is "an occurrence that shocks the conscience" -- more words, I know. However, this isn't really as vague as it seems -- the real guide is precedent. Over the years, every time a case of gouging is tried and appealed the courts essentially "set the floor" of what size of price increase and circumstances that would be needed to find guilt. This generally doesn't vary much and almost always a case of gouging is entirely obvious to all concerned.

    Also, there is no need for the product to be absolutely required for survival -- people are weird about milk because of the tradition of feeding it to babies/kids.

    The 200% thing is from a different section of the law rr(2) -- do you want me to post a section that has a percent based standard?[/QUOTE]
    What shocks your conscience may not shock someone else’s conscience.

  15. #35
    All Pro
    Join Date
    Sep 2007
    Location
    Wildcat Country
    Posts
    5,102
    [QUOTE=BrooklynBound;2832445]Fair enough. But letting prices go up will help reduce the effect of people who people who buy milk to dunk their oreos when milk is scarce. There will be more milk available for those who want to use it for their children. If prices are kept artificially low, there’s incentive for the vendor to hoard and for the customer to use more than they need. Not only are gouging laws unclear and unfair, they hurt consumers.[/QUOTE]

    There's a difference between price going up due to normal supply and demand and price gouging.

    Scenario 1: Your house is heated by natural gas. Due to a scarcity, the cost of natural gas goes up. So your gas company raises your rates accordingly. This is not gouging.

    Scenario 2: Your house is heated by natural gas. There is no change in the supply or cost of natural gas. But in January the gas company increases your rates 50%, because they know that it's winter and you basically have no choice but to pay. This is price gouging.

  16. #36
    Jets Insider VIP
    Join Date
    Feb 2006
    Location
    Van down by the river
    Posts
    23,194
    [QUOTE=BrooklynBound;2832445]Fair enough. But letting prices go up will help reduce the effect of people who people who buy milk to dunk their oreos when milk is scarce. There will be more milk available for those who want to use it for their children. If prices are kept artificially low, there’s incentive for the vendor to hoard and for the customer to use more than they need. Not only are gouging laws unclear and unfair, they hurt consumers.[/QUOTE]

    I was just busting your chops...I actually agree with your basic premise as it applys to most products. But there are two reasons I thinks milk isn't a good example.

    You can't really hoard milk. If you do...then the milk you were hoarding ends up being cottage cheese...or worse.

    And rising milk prices may deter people from using it for frivolous reasons like making the worlds largest bowl of ice cream...but substantially increasing the price on stuff rarely helps people with children. There very well be more supply...but they won't be able to afford it.


    I have a very unpopular, sure to be ridiculed idea to grow capital. Tax the sh*t out of bottled water. Anyone dumb enough to buy something that literally falls from the sky on a regular basis deserves to get the sh*t taxed out of them...I plan on selling bottled air very soon. IPO pending...

    (ps I'm not really serious...but I do think that people who buy bottled water are dumb. If you told the people at Pepsi or Coke in 1975 that they could make just as much money selling their product minus all the expensive ingredients and labor...they would of laughed their asses off. Too bad 21st century America turned out to be lacking in the mental capacity category)

  17. #37
    [QUOTE=BushyTheBeaver;2832458]There's a difference between price going up due to normal supply and demand and price gouging.

    Scenario 1: Your house is heated by natural gas. Due to a scarcity, the cost of natural gas goes up. So your gas company raises your rates accordingly. This is not gouging.

    Scenario 2: Your house is heated by natural gas. There is no change in the supply or cost of natural gas. But in January the gas company increases your rates 50%, because they know that it's winter and you basically have no choice but to pay. This is price gouging.[/QUOTE]

    My conscience is shocked!
    Last edited by fukushimajin; 10-30-2008 at 03:15 PM. Reason: typo

  18. #38
    [QUOTE=BrooklynBound;2832446]What shocks your conscience may not shock someone else’s conscience.[/QUOTE]

    It was a surprise to me too friend, but a huge part of our legal system is based on terms such as "reasonable", "unconscionable", "knowingly" and "good-faith" -- this runs through both civil law and criminal law. Ultimately that's why juries are so important and why lawyers good at making arguments to juries are so well paid.

    Remember, to be convicted of this crime, a jury of 12 individual consciences ALL have to be shocked -- that is a pretty high standard to reach.

  19. #39
    [QUOTE=BrooklynBound;2831869]Why should democracy degrade property rights? I own something, and you do not have the right to take it from me at a price that you want. It's not about might, it's about property rights.

    What if land was scarce and the people wanted to knock down your house so that a high-rise apartment could be built and more people could live there. The people who want your land and house don't have the money to pay you market value, but they REALLY, REALLY need it. After all, housing is essential. So you'll have to accept a price that they think is fair. How would you feel about that?

    And how would your example even come to fruition? Why would I rather have you die than sell it to you? I'd rather sell it to you. Maybe you'd rather pay less, but I'd rather pay less for everything. I wish was my food bill cost $1.

    Also, using your example, anyone who doesn't sell food to the poor/homeless at low prices that they can afford are "price gougers." They go hungry every day because they don't have the money to buy essentials.[/QUOTE]ok, who granted you the property? did you buy it from someone? did you fill out any government requirements and forms?

  20. #40
    [QUOTE=OrangeJet;2831956]Raising prices before a hurricane can protect against hording.[/QUOTE]no,because then i buy as much as i can(horde) and i start selling...

Bookmarks

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts
  •  

Follow Us