Supply and Demand

It seems ammo prices are coming back to normal, and some people normally on the side of free markets are pissed that vendors were selling ammunition for higher than usual prices when there was less than usual to offer for sale:
5.56 mm ammunition was reaching a dollar per round, but that has trailed off to around 75 cents per round, and I expect it to go lower.  The stores around me (and you know exactly who you are) who were selling 5.56 mm ammunition for four dollars per round now have customers who are royally pissed off (and I noticed that you have backed way off on your prices now).  You reap what you sow.  I'll keep increasing my stockpile of 5.56, but not by purchasing from you.
Why be mad?  If you didn't have ANY 5.56 ammo, you might be willing to pay $4 a round and be happy to now have SOME 5.56 ammo.  If you already have 5.56 ammo, and just wanted to stockpile more, you'll pass because the price is too high and you don't actually need it -- thus making sure there is some available for the person who does need it.  This is how the free market allocates resources when they are scarce.  It's natural, normal, and entirely appropriate.

Unless those who don't have 5.56 mm ammunition know that the price will go back down. The losers will be the stores who charged 4 dollars per round. I already see it around here.
Those who don't have it and are willing to wait until the price comes back down are doing the right thing for them, and making sure that the people who are willing to pay that higher price have ammunition available to buy when otherwise there would be none.

Yes, raising prices in a time of scarcity often annoys people.  It shouldn't; being annoyed at economics is irrational.

I didn't buy guns or ammo during the recent unpleasantness, because I figured that the prices were going to be inflated due to the demand and if no significant gun control was passed they would be coming back down.  Also, I had a reasonable amount of ammunition for my firearms already.  I didn't *need* more guns or ammunition, so I did not buy more at inflated prices.  Several of my friends had been meaning to buy a gun, but had not gotten around to it.  Not only were they willing to pay inflated prices NOW to make sure they had what they needed if a ban did occur, they were happy to pay those prices knowing they were inflated because, if they did not, they might be left with nothing in the event of a ban.  (No, they did not buy from me.)

Because people like you and me did not buy at the higher prices, people like my friends were able to and happy to.  Would it be a better world if you and I had a heavier gun safe and my friends had nothing because the shelves were bare?

This entry was published Tue May 28 22:07:41 CDT 2013 by TriggerFinger and last updated 2013-05-28 22:07:41.0. [Tweet]

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