Basic economics tell us that supply and demand dictate prices. The current over-supply of oil has reduced the price to under $50 a barrel but is this rule always true and what drives demand? If everyone gets a pay rise, demand is increased but where does the money come from? All money comes from central banks, of course, and so it is the central banks that create demand by printing money.
Supply and demand is a term used in economics and finance rather than psychology. The more something is in demand, the more pressure there is to raise the price. When the supply of goods is plentiful, as in a good harvest that provides downward pressure on prices. (more…)
My short post on Wednesday was about winning the lottery. I did buy a ticket in the end. I had just £2.00 left in my account and so I thought it was worth a try. Was it worth it though or just another £2.00 down the drain? It wasn’t worth it because I didn’t win, but we have to take risks in life and I took a risk. (more…)
Last year when I wanted a new microwave, I shopped around and went to Comet in the end. Now Comet has closed down, I have less choice and so when my freezer died I checked them out online and went to Curry’s to buy one. There is now less competition for Curry’s and so they will fill the gap left by Comet and sell more. There is still lots of competition in that market though. (more…)
The concept of supply and demand affecting prices is well known. If something is scarce, people are willing to pay more for it, especially if they have the money to do so. In the UK housing market there has been a shortage of housing for many years and too few new properties have been built. This is part of the reason for increased prices. Demand has also been higher, but all is not what it seems.
In theory, competition and supply and demand should regulate prices in a free market. In practice that isn’t the case. There are monopolies and cartels. There can be a lack of competition. There can be government interference in the market, such as the government’s ‘help to buy scheme’; that can distort the property market. An increased money supply can also mean increased demand.
I’m not too sure about this photograph. It’s different from the usual photograph that I use. It was taken a few evenings ago and has been edited to make it a little more ‘artistic’. It shows what you can do with a digital camera and a little experimenting. I did a few blogs this week too…
Imagine living in an English country village, surrounded by farms where all the fresh food comes from. You can go to the local farm market in the village and buy fresh food from lots of different farmers. You would probably shop around to get the cheapest meat and vegetables. You might eat whatever is in season and take advantage of availability and low prices. When there was a glut of apples, because of a good harvest. You would be able to buy lots to make chutney and apple pies.