Inflation:
A few days ago I posted Boring “Survivalist” Successes. Tangentially, my post bumped into economics. That wasn’t the point but while I was pondering the epic shortage of .22 ammo I touched briefly on inflation. I posted this:
“Like everything, the price of ammo has gone through the roof.*”
The asterisk went to a couple hundred words hastily tacked on the end of my post. I ranted that I’m sick of being fed crap from the press about a total lack of inflation when I can see it myself.
Walk into a grocery store and pick up a goddamn can of tuna. Then find out what the price was a few years ago. The esoteric and difficult science of subtraction will verify right then and there that the cost has gone up (or the can has gotten smaller). Unless we assign the change to magic elves… that’s inflation. I can do the same with chicken feed, truck tires, chainsaw oil, etc…
To quote Chico Marx: “Well, who you gonna believe, me or your own eyes?”
Hoarding:
But hey, it’s just expensive tuna right? Also I was supposedly talking about .22 ammo.
As soon as I got back on track with ammo I bumped into another pet peeve; “hoarding”. I know .22 ammo is in short supply. I know this because it’s not on the shelves. America is currently a place where tofu is plentiful and .22 ammo is absent. We’re screwed!
The question is why? Ten minutes with Google indicates the same factories are churning out the same amount of ammo as before. I’m also doubtful that the Feds are buying much .22. (Since when does the Fed consume cheap plinking rounds? They like calibers more effective for shooting people.) Also there’s no indication of more consumption elsewhere. (A hard fought defense against invasion by squirrels and paper targets?)
Obviously it’s getting purchased and stacked in various garages and basements. People who formerly bought .22 in dribs and drabs are now buying it by the shitload. Pretty much everyone else has come to a similar conclusion.
Then, from out of left field (and I mean literally the left ass cheek of freakin’ Marxist redistributive economic theory) comes the complaint; “those bastards are ‘hoarding’ it”.
I hate that term! “Hoarding” like “gouging” is simply a word used by people who disagree with what you’ve done with your money. I expect crap like that from Socialist morons but not from the gunnie’ crowd.
Freedom means freedom. It doesn’t mean freedom to buy ammo but only if I’ve already got mine. Free citizens can buy all they can afford. They can stack it like Legos and add it to beer can sculptures. They can stockpile eleventy zillion rounds of .22 in their mom’s basement. They can use it to make a maze for a pet weasel. They can piss on it, use it for poker chips, paint it blue, bury it, sell it on e-bay, or put it on a pedestal and worship it. It’s their money and if they want to buy .22 by the freight train that’s none of my business. Nor does it have to make sense. If a mall ninja who’ll never ever set down the tactical Twinkie and head to the range thinks he needs 30 crates to hold back the invading Bulgarian army (which somehow can’t armor up against squirrel rounds?); so be it.
Freedom means respecting others as they make their own choices. I added this:
“[I]f I hear any horse shit about “hoarding” in the comments I’ll strike it. Americans are free citizens. They can buy whatever the hell they can afford and do whatever the hell they want with it… including amassing great piles and lying on it like Scrooge McDuck. ‘Hoarding’ is a word coined by the economically illiterate to define a situation where people do something with their money that doesn’t meet with their approval.”
What can I say. I had a bee up my bonnet that day.
The point is that there is an instant and ready solution to shortages. Price.
If people descend on WalMart* and buy a month’s supply by noon, then WalMart fucked up. The price was artificially too low and WalMart let that money walk out the door. We all hear stories of the big mean jerk who bought it at WalMart and then sold it on E-bay at a profit. Which, ahem… is just a way of saying a small operator got the profit WalMart refused. It was a price differential just laying there on the ground. Why be angry at the guy who picked it up and put the profit in his own pocket.
Raise the price. If they keep paying, smile all the way to the bank. Raise it again. If they keep paying, smile more! In theory the perfect price is when the last box is sold one minute before the next shipment arrives and not a minute before.
Also, if the market reflected the true demand, it would encourage more factory investment in making the damn stuff in the first place. That too is the whole point of prices. Everyone (or almost everyone) reading my blog knows how to reload and the rest can figure it out. There is some price point somewhere where you’d tell your boss to stuff it and build an ammo factory in your garage. (Admittedly that price point is pretty high… but it exists.) There’s also a price where you’d park the trusty Ruger 10/22 and gear up in .17 HMR.
So I have to live in a world where stores (for some deranged reason) maintain an artificially low price and everyone bitches about “hoarders”.
The Bullshit Two-Fer:
At least there’s nobody so stupid as to press my buttons on inflation and hoarding at the same time. Whoops, not so fast! Here’s a link from another group that can’t understand shit about economics; the Fed. (Hat tip to Borepatch.) It turns out the Fed is looking all over for inflation and simply can’t find where they left it.
“Though American consumers might dispute the notion that inflation has been low, the indicators the Fed follows show it to be running well below the target rate of 2 percent…”
So the Fed can’t find something that cost $1.00 last year and costs $1.03 today? Really? Have they looked up their ass?
So what explains this tragic stability in prices?
“the central bank branch published this week blames the low level of money movement in large part on consumers and their “willingness to hoard money.”
Got that? If you have money, the Fed knows what you should do with it. You should go out and spend it. If you didn’t you’re making the wrong choice. Of course the wrong choice is defined as not the choice the Feds want you to make. Or, as is so commonly heard these days “hoarding”. You see, the problem with “hoarders” is that:
“…people are sitting on cash rather than spending it.”
Yep, you thought the money was yours but it’s not. It’s the Feds and you’re messing up their delicate system of unawareness by not running out and dropping your savings on… stuff.
So there you go. The price of everything is creeping upwards but this is not “inflation” because the Feds can’t discover it. Sellers won’t raise the price of ammo so it’s sold out. This is “hoarding” and not mis-pricing. And furthermore if you keep your money in your pocket (instead of buying .22 ammo?) that too is hoarding.
Someday I’ll find a single new article that includes “no inflation”, “hoarding”, and “gouging”. That will be the day my skull implodes.
A.C.
* I don’t mean to pick on WalMart exclusively. Sellers with names like Duck Hill and ones that rhyme with Crabellas are doing the same thing. Keeping the price low and selling out.
Most of the big box ammo retailers are probably keeping prices low because it makes for good customer relations in a way that doesn’t ‘hurt’ their bottom line. They are making the same amount on .22 ammo as they were before (almost nothing) and they don’t have inventory on the books. It actually looks a bit better to an accountant. Plus, those folks that visit your store six times a week hoping to get that one box wander through your store and hopefully impulse buy something they actually make profit on.
I do know the fair market value of .22 ammo is, but it’s above what I can make a similar amount of 9mm ammo for, which is why my .22 sits on the shelf and I’m shooting 9mm. Saving the .22 for the kids.
I wonder if, in the long term, a .22 “shortage” will be turn .17 HMR into a breakthrough product. After all, the only advantage of rimfire is that it’s cheap and common. Both are (temporarily?) no longer true.
If 17HMR came down, I would love it 🙂
Even my kids shoot the 17HMR like its on fire. I can’t reliabily do 150 yard head shots on squirrels with .22 but 17HMR, its almost a chip shot.
The gun shop I deal with had ammo all during the centerfire shortage. He kept selling it at roughly the same prices as before the shortage. He knows his customers and only sold 50 rounds of each caliber a week to each customer.
The second part of that equation sounds like rationing, however his logic was that he wanted people to still be able to go out and enjoy shooting.
The first part of the story is that he made it clear that he wasn’t going to gouge his customers just because he could.
He is 15 miles from where I live, I pass a Gander Mtn and two WalMarts to go buy ammo from him, it is still about the same price as before the shortage and he has loyal customers.
Win, Win, Win.
There are a lot of reasons to despise the “Planners” who stump for government control of this and that, but this is one that strikes a chord with me. They lack the responsiveness, intelligence, and scope to actually predict what something as complex as the economy will do, and when they inevitably fail they whine that people won’t do what was predicted.
Listen, you oiks, you FAILED. You ALWAYS fail. You fail because you can’t succeed, because your theories are bunk and your pride is unfounded, not because we the people do wrong things.
Pillocks.
Markets are about the hardest thing to “manage”. So much so that if you think you’re managing it…. likely you’re fooling yourself. (Perhaps it is the market that is managing you?)
I once read someone describing planned markets like this: “Imagine on January 1st you must buy your household’s toilet paper for the year. For the rest of the year you must use only what you bought on January 1st. If you buy too much it’ll be taken away on December 31st and you’ll lose that excess. Now, given all the time in the world and adequate money, decide how much you’ll need. Then see how your year pans out.” If you seriously start considering that simple, tiny, almost silly easy, estimation… you realize it’s much harder than it looks. Yet in an “unplanned” lifestyle, we spend our whole life without buying too much or running out.
It’s just a simple example but I find the analogy extra funny; Venezuela is bitching about “hoarding” toilet paper and nationalizing TP factories and the former USSR was famous for long lines for waxy unpleasant TP. Oil rich nations and (at the time) superpowers couldn’t handle that simple commodity. No wonder the Fed thinks we’re “hoarding” our own money.
The thing is, the Lefty Intellectuals have ranted for years about how “Capitalism” excludes people from control of the market, as if market forces were some kind of malign plot cooked up by Gnomes un Zurich. The free market IS exactly the kind of “let’s consult anybody who’s interested” mechanism they claim to want. And it routinely tells them that people don’t give a fat damn about what Lefty Intellectuals think they should.
So the Leftys hate it.
I’ve said this before, but maybe not here and it bears repeating; the history of man is the history of a succession of self-selected elites telling the Common Man what to do for his own good, and what the Common Man had to do to get rid of the bastards. Progress is the degree to which the Common Man can tell the elite to go climb a tree, and make it stick.
There was an old joke in the former USSR:
What would happen if the Red Army were to capture the Sahara? Nothing for six months, then there would be a shortage of sand.
Governments, made up of people who think words on paper will magically alter the laws of physics, economics, or morality, cannot plan anything more complex than theater.
The .22 shortage may be winding down a little. I am seeing it show up in a few more stores.
One of the local shops actually put a sign up outside that said “22 in stock”, they did not last a day.
But they were there and and the ones who check every day already had gotten theirs, so a few others got some too.
Maybe the basements and closets are getting full.
“I’m also doubtful that the Feds are buying much .22.”
Besides people buying more, I thought actually less was being produced, due to the factories concentrating on centerfire cartridges. Might be wrong about that though.
“I expect crap like that from Socialist morons but not from the gunnie’ crowd.”
Uh, why? There is just as large a fraction of Socialist morons among gunnies as any other population. Ask them how many are accepting and dependent on Socialist Security, or using government schools.
“Freedom means respecting others as they make their own choices.”
I would use the word “tolerating” rather than “respecting”. Not all choices are worthy of respect.
As to prices, I agree. The “charge what the market will bear” mentality is exactly the prescription for distributing ammo to the person who really needs it. A high price will keep the “hoarders” out of the market while serving the fellow who just needs a box to defend his home (and thus has a higher motivation to pay that high price). He’s more concerned about shortage than about price. However I wouldn’t be *too* hard on Walmart for the price point they use. After all, they are selling into a market of economic illiterates and (as you say), socialists. They want to keep their customers around after the shortage slacks off, and they may worry there is a hidden cost to charging what the market will bear – their customers might be pissed off enough to remember later and take their business elsewhere. That’s probably not entirely it (since they sell to people who want the lowest price, no matter what “unfair” practices they were previously charged with), and the main reason for their prices may simply be economic ignorance, but hidden cost still may be a factor. Though, now that I think about it, empty shelves annoy customers too.
Well, the free market allows a vendor to set prices too low also. “A fool and his money are soon parted.”
I’ve heard the ‘hoarding’ theory that explains the mysterious lack of .22. Plausible, I suppose, except that if there were evidence for it, I’d have seen some by now. Evidence, that is. Also, .22 ammo.
I hang with some seriously demented gun nuts. If there were a lot of people out there hoarding .22, I’d pretty much have to know at least one of them. Instead, I only know a bunch of perplexed people wondering where the hell’s all the .22.
So I’m not sure I buy the ‘hoarding’ theory.
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