Hey jerk, I answered at the begining of this thread. Then I asked YOU a question.
Let's see:
Me: Anyone here recognize the fundamental conflict in these two statements, both by President Bush, on consecutive days, on the same subject?
Jan. 31: “America is addicted to oil.”
Feb. 1: "I think that basically the price is determined by the marketplace and that's the way it should be." Referring to the $36.13 billion profit Exxon Mobil Corp. posted in 2005.
You:
Huh, I guess I didn't realize you were substituting an emoticon for an actual answer. But that's cool, you are after all a man of many posts and few words. Anyways, do you see the conflict between those statements now?
I have to say it's been entertaining watching folks here bending over backwards here trying to rationale the big oil company profits, perhaps in an attempt to move away from the actual issue I brought up. Which, no matter how many times y'all try to change the subject, is this:
1. "Addictions," whether literal or figurative, are an example of inelastic demand.
2. Inelastic demand makes free market economies work less well.
Highline: there is no such thing as a perfectly inelastic commodity (I do believe that economists are aware of that!), but perfect inelasticity is not required to mess up the system.
Tinark and others: addictive commodities are certain to be partially influenced by market forces; if they weren't, then all inelastic commodities would quickly become essentially infinitely expensive. The point is not that they don't respond at all, it's that they don't respond properly (think "efficiently," perhaps). Consider this analogy: if I'm severely out of shape, that doesn't mean my body can't function at all, or that my heart beats backwards; it does mean that my body just doesn't function well/efficiently/properly.
Quote:
Originally Posted by BillyBob
Now, you could simply answer it and move on. Or, you could pretend I didn't answer your dopey question, suggest that I am afraid to answer it and then wrongfully accuse me of 'blowing smoke' as a way for you to avoid answering the question I asked.
The question itself was the 'smoke-blowing,' as if you didn't know that already! But, to allow you to participate in the thread topic itself, allow me to answer your question:
AHarvey, you're mixing apples and oranges. Believing prices should be dictated by the free market does not imply that you think everything should be determined by it.
If you're really a Goth, where were you when we sacked Rome?
Incidentally, I found the updated US weekly gas price and support data (from U.S. government sources): here's the most recent data on gas prices.
For some reason the feds give the gasoline delivery data in a quite awkward format that does not lend itself to ready graphing. I'm working on fixing that, though.
AHarvey, you're mixing apples and oranges. Believing prices should be dictated by the free market does not imply that you think everything should be determined by it.
Perhaps, but I don't see the relevance here, as I am not the one who chose the fruit. Check the first post. If you don't think oil prices should be dictated by market forces then you shouldn't say that oil prices are being dictated by market forces as they should be!
so-and-so believes that “America is addicted to oil.”
so-and-so believes that "I think that basically the price is determined by the marketplace and that's the way it should be." Referring to the $36.13 billion profit Exxon Mobil Corp. posted in 2005.
so-and-so believes that the marketplace should be a free market economy.
so-and-so understands how a free market economy functions.
Sorry, that's all I was trying to say. If you believe that America is addicted to oil, then you know its price won't be properly determined in a free market economy, unless you don't understand how supply and demand operate. It's a simple point, really.
My simple mind is failing me, I don't see the conflict. The "addiction" is a factor in setting prices in the market place.
God . . .even when we were dead in our trespasses, made us alive together with Christ--by grace you have been saved. Ephesians 2:4-5 ESV
A dog barks when his master is attacked. I would be a coward if I saw that God's truth is attacked and yet would remain silent. . . . John Calvin
Um, you see that text I emphasized in your post above? That's what's called "inelastic demand"! Market forces don't work properly on products subject to inelastic demand. I didn't invent that concept, you know. When you say it's not a problem, do you mean it's not a problem when market forces don't work properly? Or do you mean that market forces do work properly even when confronted with inelastic demand?
No, inelastic demand is not what precludes market forces from working properly as long as there is competition among suppliers. Inelastic demand is frequently used denote when a threshold must be met for changes to take place; below such a point, the buying market will adjust in other areas to accommodate (as is the case here). This is market forces in action, before and after threshold is met.
up-to-date US gasoline consumption data... -
February 3rd, 2006, 11:47 AM
... is now available here. These data (the gasoline use and price) have always intrigued me. There are some beautiful patterns in there, taken together and taken separately.
Sigh... Look, Yorzhik mentioned monopolies earlier. Are monopolies considered a normal part of a properly functioning free-market economy?
No, but then again, monopolies cannot exist without gov't protection. If you find a problem in oil prices, since that is so commonly the problem (gov't protecting a monopoly), you might try to look there first. If you don't find the problem there, then you have the hard task of following money around until you do find the problem.
BTW, the market sets the threshold that causes inelastic demand. It would be a contridiction in terms to say that in cases like this that the market wasn't working efficiently. There may be other places in the oil market that cause problems, but don't forget the rule of thumb in figuring out what those problems are: look to gov't interference first, and if the problem isn't there, then follow the money.
And one more thing; what's your point? That Bush et al. are doing nothing but raping the public via oil market manipulation? If that isn't your point, what is point?
Good things come to those who shoot straight.
Did you only want evidence you are not going to call "wrong"? -Stripe
No, inelastic demand is not what precludes market forces from working properly as long as there is competition among suppliers. Inelastic demand is frequently used denote when a threshold must be met for changes to take place; below such a point, the buying market will adjust in other areas to accommodate (as is the case here). This is market forces in action, before and after threshold is met.
So am I dealing with the excluded middle fallacy here? When one refers to an "addiction" to a commodity, no matter how figuratively, is one referring to a normally slightly inelastic commodity like toilet paper? Is GW referring to any other aspect of our oil use as "addictive" besides the fact that we use vast quantities of it no matter what the price?
Location: Matrix, or Indiana, what's the difference?
Rep Power: 41465
Christian
More left than right
Slogan/motto:
Being a slave to Christ is freedom, and being free from Christ is slavery (to the world).
Reputation:
February 3rd, 2006, 03:16 PM
In simple terms. Price does not adequately regulate demand, therefore demand does not restrict price. Without government regulation supply-side exploitation is to be expected. AKA price-gouging. Is that about it?
"As long as people believe in absurdities they will continue to commit atrocities."
"It is difficult to free fools from the chains they revere."
"The world embarrasses me, and I cannot dream that this watch exists and has no watchmaker."
February 3rd, 2006, 11:11 AM
Linear Mode
