iconomics

Supply versus demand. Price correction versus rationing. Three current examples.

Firstly, crude oil. Those ostriches and optimists who think that the high price of oil is just a temporary blip caused by "speculation" in the futures market should face reality. Our lifestyles will change. For some of the economics, Paul Krugman.

Secondly, petrol. Not the long term year on year price increase caused by the point above, but the refusal to change prices in the face of temporary supply restriction. For an example of the madness, my post here.

Thirdly, the iPhone. In this case, scarcity is deliberate strategy. And I think a bad strategy. Apple could have managed this so much better. As usual, Seth Godin has some suggestions for how.