We all resent the corner gas shop who jacks up his prices in an effort to gouge the rest of us during an emergency. But what if people do something virtually identical but nobody sees because they don’t have a corner shop? The price of oil is skyrocketing on concerns about Middle East stability and supply. And this is also obviously driving up the price of gasoline, which hits us drivers directly and everyone indirectly in things like the cost of food and other goods. On its own this is a problem. But that problem is exacerbated precisely because people observe that oil makes a very good speculative commodity because it’s rising so fast. So investment “experts” are saying to partake in the profits and to hedge off some of the costs at the pump. (“As consumers, we can make decisions that reduce our consumption of oil. And as investors, we need to consider having exposure to oil in our investment portfolios in order to capture gains for the continued rise in the price of oil.”)
But this form of other-harming speculation only increases the dollar-demand for oil, thereby driving up the price even farther and turning a significant problem into a perilous one at the expense of other people’s misfortune. Haven’t we seen the ruinous effects of this in housing already? Obviously, this latest Tulip bubble will burst eventually, just like every other bubble before it. But in the meantime people are paying more at the pump and at the grocery store and those who seek to profit in this way are doing something fundamentally parasitic upon the rest of us, particularly the poorest among us. I know “someone” is going to participate, but the fewer who do, the less bad it is for everyone AND the less reward for the wicked ones who do it first. You may miss out on profits to be had, but if enough of you forego those, the effect on all of us will be so much less awful.
But this form of other-harming speculation only increases the dollar-demand for oil, thereby driving up the price even farther and turning a significant problem into a perilous one at the expense of other people’s misfortune. Haven’t we seen the ruinous effects of this in housing already? Obviously, this latest Tulip bubble will burst eventually, just like every other bubble before it. But in the meantime people are paying more at the pump and at the grocery store and those who seek to profit in this way are doing something fundamentally parasitic upon the rest of us, particularly the poorest among us. I know “someone” is going to participate, but the fewer who do, the less bad it is for everyone AND the less reward for the wicked ones who do it first. You may miss out on profits to be had, but if enough of you forego those, the effect on all of us will be so much less awful.
No comments:
Post a Comment