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> You can set reasonable price benchmarks to define "shortage" by. If there is some kind of useful benchmark, exclaiming "shortage" doesn't tell you anything a

> You can set reasonable price benchmarks to define "shortage" by. If there is some kind of useful benchmark, exclaiming "shortage" doesn't tell you anything about that benchmark. Again, nothing is communicated. Pointless, indeed. > Price is always able to select a buyer. Always, except for when there is a shortage. There are all kinds of examples of where price cannot select a buyer, most commonly as a result of government intervention making it illegal to pay more than a certain price, leaving many buyers all willing to pay the maximum allowable price for a given good or service, thereby requiring some other kind of mechanism, such as a lottery, to determine the 'winner'.

Dylan16807 3y ago
Do you think there can only be shortages if there's price fixing? If not, please give an example that doesn't involve price fixing. I'll give an example for my argument: If there's only enough food for 90 people out of 100 today, it's easy for anyone with enough money to get fed, but it is also a shortage of food.
- randomdata 3y ago
  > Do you think there can only be shortages if there's price fixing? Clearly not. I just got finished pointing to government intervention as the most likely reason for a shortage. How did you manage to not finish reading the comment before replying? Price fixing can also theoretically lead to a shortage, but this is the least likely case. Usually price fixers want to push the price higher than buyers are looking to spend, not the other way around. > If there's only enough food for 90 people out of 100 today, it's easy for anyone with enough money to get fed, but it is also a shortage of food. Agreed, in two ways: 1. It is apt to end up a shortage as many governments have 'price gouging' laws that would prevent the vendor of that food from charging the fair market value in this type of event. 2. In this scenario, eventually no amount of money can buy food. You could be the richest person on earth, willing to spend every last cent you have, but you're still not eating if you happen to come late to the party. Price is unable to select a buyer, relying on a first-come, first-served mechanism instead. That doesn't match the housing situation, though. The richest person in the world isn't going to find himself unable to buy a home, even if he takes his sweet time deciding whether he wants one or not. Even at the peak of housing insanity, there were still many houses available for purchase by anyone in the market.
  - Dylan16807 3y ago
    When I say fixing I primarily mean government fixing. But thanks for insulting my ability to read because I used the wrong synonym (fixing/control). Therefore I will ignore price gouging laws because that's a form of the above but also if reasonable they won't apply to a person selling their own single allocation. > In this scenario, eventually no amount of money can buy food. You could be the richest person on earth, willing to spend every last cent you have, but you're still not eating if you happen to come late to the party. If you come after everyone eats for the day then that's not a shortage by my reckoning. Price works just fine as long as you're not insisting on being served between meals. It's not like you can expect to buy a house in less than a day no matter your budget. So I still don't see a big difference here between 90 meals and 90 houses for 100 people. There's always a price that will get you one.
    - randomdata 3y ago
      > So I still don't see a big difference here between 90 meals and 90 houses for 100 people. The difference is that once the meals are consumed, that's it. 91st in line can't buy food no matter what. No amount of money is going to produce the 91st meal. As such, when food stocks are tight, you cannot rely on price to determine the buyer. You have to resort to some other mechanism. Given the limited information you provided, it would appear that you chose a first-come, first-served mechanism. On the other hand, 91st in line for a house, if he has enough money, will buy a house from someone in the first 90 who got there first. There is always a house for sale. They don't disappear (freak disasters excepted). They are not consumable items. Even during the tightest inventory periods we've ever witnessed, there were still many houses available for sale. Price can continue to determine the buyer here. Those who cannot afford them leave the market. Economically, this is not a 90 houses for 100 people situation. If there are 90 houses, then only 90 people will remain in the market. The other 10 are priced out. Those 10 are not market participants, they are simply dreamers. Dreamers don't count. Socially, there can be a 90 houses for 100 people situation. I get you are wishing you could use shortage here, but what are you communicating? Everything with a price attached has more people dreaming of ownership than there are units available. That's why there is a price attached. That's literally what price is for – to reduce the number of potential buyers until the number of buyers matches the number of units available for sale, with price increasing until that is satisfied. Basic supply and demand. When using shortage to include dreamers, everything is in shortage, always. What is the point in drawing particular attention to something that is always the case? It's pointless. You are not saying anything. Nothing has been communicated.

Dylan16807 3y ago

Do you think there can only be shortages if there's price fixing? If not, please give an example that doesn't involve price fixing. I'll give an example for my argument: If there's only enough food for 90 people out of 100 today, it's easy for anyone with enough money to get fed, but it is also a shortage of food.

randomdata 3y ago
> Do you think there can only be shortages if there's price fixing? Clearly not. I just got finished pointing to government intervention as the most likely reason for a shortage. How did you manage to not finish reading the comment before replying? Price fixing can also theoretically lead to a shortage, but this is the least likely case. Usually price fixers want to push the price higher than buyers are looking to spend, not the other way around. > If there's only enough food for 90 people out of 100 today, it's easy for anyone with enough money to get fed, but it is also a shortage of food. Agreed, in two ways: 1. It is apt to end up a shortage as many governments have 'price gouging' laws that would prevent the vendor of that food from charging the fair market value in this type of event. 2. In this scenario, eventually no amount of money can buy food. You could be the richest person on earth, willing to spend every last cent you have, but you're still not eating if you happen to come late to the party. Price is unable to select a buyer, relying on a first-come, first-served mechanism instead. That doesn't match the housing situation, though. The richest person in the world isn't going to find himself unable to buy a home, even if he takes his sweet time deciding whether he wants one or not. Even at the peak of housing insanity, there were still many houses available for purchase by anyone in the market.
- Dylan16807 3y ago
  When I say fixing I primarily mean government fixing. But thanks for insulting my ability to read because I used the wrong synonym (fixing/control). Therefore I will ignore price gouging laws because that's a form of the above but also if reasonable they won't apply to a person selling their own single allocation. > In this scenario, eventually no amount of money can buy food. You could be the richest person on earth, willing to spend every last cent you have, but you're still not eating if you happen to come late to the party. If you come after everyone eats for the day then that's not a shortage by my reckoning. Price works just fine as long as you're not insisting on being served between meals. It's not like you can expect to buy a house in less than a day no matter your budget. So I still don't see a big difference here between 90 meals and 90 houses for 100 people. There's always a price that will get you one.
  - randomdata 3y ago
    > So I still don't see a big difference here between 90 meals and 90 houses for 100 people. The difference is that once the meals are consumed, that's it. 91st in line can't buy food no matter what. No amount of money is going to produce the 91st meal. As such, when food stocks are tight, you cannot rely on price to determine the buyer. You have to resort to some other mechanism. Given the limited information you provided, it would appear that you chose a first-come, first-served mechanism. On the other hand, 91st in line for a house, if he has enough money, will buy a house from someone in the first 90 who got there first. There is always a house for sale. They don't disappear (freak disasters excepted). They are not consumable items. Even during the tightest inventory periods we've ever witnessed, there were still many houses available for sale. Price can continue to determine the buyer here. Those who cannot afford them leave the market. Economically, this is not a 90 houses for 100 people situation. If there are 90 houses, then only 90 people will remain in the market. The other 10 are priced out. Those 10 are not market participants, they are simply dreamers. Dreamers don't count. Socially, there can be a 90 houses for 100 people situation. I get you are wishing you could use shortage here, but what are you communicating? Everything with a price attached has more people dreaming of ownership than there are units available. That's why there is a price attached. That's literally what price is for – to reduce the number of potential buyers until the number of buyers matches the number of units available for sale, with price increasing until that is satisfied. Basic supply and demand. When using shortage to include dreamers, everything is in shortage, always. What is the point in drawing particular attention to something that is always the case? It's pointless. You are not saying anything. Nothing has been communicated.