Supply, demand and prices

What would make a “good” economy?

Officers of the ship my husband proudly commanded is holding a reunion in Las Vegas. This is not a place we ever visit as we neither are gamblers (except for driving these days) nor are we big show people (I demurred when wives wanted to see Donnie Osmond tomorrow night). Instead, I see this as a laboratory experience for me, at least, for a couple of days.

Do not under any circumstances tell me the economy is bad, as I heard Wednesday 73% of the country registered in a poll. If that is true, why are there literally wall-to-wall people here? The queue for buses to reach the rental car facilities at the airport had to be a minimum of 30 minutes, with three buses running simultaneously. The queue for checking into our hotel, hardly at the “high” or most modern end of the spectrum, was extensive though the fifteen cashiers kept it to about a 20 minute wait.

People may think the economy is bad but I would love to hear what they think a good economy would be. Go on, tell me. The $20+ for two Starbucks instant oatmeals and an orange juice struck me as insane but isn’t that just market economics, people? You know, that supply and demand thing? Or am I missing something?

I often comment on people admiring problems but I am genuinely curious how they would see improvements to create a good economy. What is it they are finding so bad if they can flock to this rather expensive place? I genuinely want to understand what I am seeing and hearing.

Yes, prices rise regularly. I wish I had not seen an $6.69 box of cereal Tuesday which got my attention but I did not buy that box as I looked for an alternative. Inflation has subsided from its highs two years ago but inflation is not prices, rather the rate of increasing prices. We are never going to get back to 1740, 1800, 1923, 1970 or 1986 prices. Anyone telling you that is either lying or ignorant, if not both.

Are the bulk of good old, American capitalist spenders advocating for imposing wage and price controls, as so often occurs in societies like 1984 Argentina where triple digit inflation increased prices literally as one walked up and down the street? If so, wage and price controls mere create greater demand over the long run without lowering costs. They simply don’t. And that would have to be a government-imposed regulation which mitigates against our supposed fear of government stealing our freedoms.

Truth is that companies make money for their shareholders or owners, depending on the size of the entity. No president, no senator, no anyone will lower prices if we want a free market system. This is one of the ways we most fear the CCP, supposedly, so why do some people seem to think that is a preferred outcome? We may see prices drop occasionally but hardly to the levels from decades ago unless the product—whatever it may be—becomes obsolete because no one wants to product.that is what supply and demand are all about.

I am not sure why people would not grasp that there is more expendable, discretionary money in people’s pockets, so companies big and small seek to snatch it away with us often paying for things we find expensive because we want the item. Not necessarily need the item but want it. And for the people here, not necessarily in inner city low income areas of Detroit or Miami, they are confusing discretionary spending with the basics: rent, subsistence food, and essential medicine/health care. Vegas trips are not, repeat not mandatory for anyone who comes one an excursion; living here is different, of course. I bet the costs off the Strip are considerably lower but that is supposition.

I know at least someone will say government regulations drive up costs. Perhaps but what fascinates me about this place is how completely market-driven it seems. No paper recycling. No bottles recycling. No limits on water use in the desert. Those three alone indicate to me that this is hardly a highly regulated area except for assuring the gambling revenue actually goes into the casino’s hands. Yes, regulations may increase prices but I am dubious that explains the costs that people are talking about since I worry people don’t see the basics and supply and demand.

That does not mean I oppose people spending their earnings as they want. Absolutely not. I respect people making their own choices. I know some people think my husband and my choices are not the ones they would make. Fair enough. But we are making conscious decisions, not confusing them with protesting the cost of what we buying or where we are spending. If we think it too high, we usually don’t buy it as few things are indeed mandatory personal spending. Much of life is the gift of choice.

The evidence is that the economy looks pretty good compared with times in the past, despite polling. But I am driven by economic history. I am curious to hear others explain why they see it as so bad so I can grasp what options might be available to address their concerns. I am dubious there are many palatable ones but happy to be proven wrong with evidence.

Thank you for reading Actions today. I appreciate your time as you could be doing something else. I truly want to hear your thoughts, good, bad or indifferent. I appreciate each of you.

I unveil our new “suitcase kitty” since we lost our beautiful Eleanor on Wednesday afternoon at 19 years young. Harry will carry on in her honor but we already miss her so much. She was a wonderful housemate for us all, rounding out our family.

Be well and be safe. FIN