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summergirl825
11-08-2005, 08:24 AM
This makes a lot of sense~

A man eats two eggs each morning for breakfast. When he goes to the grocery store he pays .60 cents a dozen. Since a dozen eggs won't last a week he normally buys two dozens at a time.

One day while buying eggs he notices that the price has risen to 72 cents. The next time he buys groceries, eggs are .76 cents a dozen. When asked to explain the price of eggs the store owner says, "the price has gone up and I have to raise my price accordingly".

This store buys 100 dozen eggs a day. I checked around for a better price and all the distributors have raised their prices. The distributors have begun to buy from the huge egg farms. The small egg farms have been driven out of business.

The huge egg farms sells 100,000 dozen eggs a day to distributors. With no competition, they can set the price as they see fit. The distributors then have to raise their prices to the grocery stores. And on and on and on. As the man kept buying eggs the price kept going up. He saw the big egg trucks delivering 100 dozen eggs each day. Nothing changed there.

He checked out the huge egg farms and found they were selling 100,000 dozen eggs to the distributors daily. Nothing had changed but the price of eggs.

Then week before Thanksgiving the price of eggs shot up to $1.00 a dozen. Again he asked the grocery owner why and was told, "cakes and baking for the holiday". The huge egg farmers know there will be a lot of baking going on and more eggs will be used. Hence, the price of eggs goes up. Expect the same thing at Christmas and other times when family cooking and baking happens.

This pattern continues until the price of eggs is 2.00 a dozen. The man says,"there must be something we can do about the price of eggs". He starts talking to all the people in his town and they decide to stop buying eggs. This didn't work because everyone needed eggs. Finally, the man suggested only buying what you need.

He ate 2 eggs a day. On the way home from work he would stop at the grocery and buy two eggs. Everyone in town started buying 2 or 3 eggs a day.

The grocery store owner began complaining that he had too many eggs in his cooler. He told the distributor that he didn't need any eggs. Maybe wouldn't need any all week.

The distributor had eggs piling up at his warehouse. He told the huge egg farms that he didn't have any room for eggs would not need any for at least two weeks.

At the egg farm, the chickens just kept on laying eggs.

To relieve the pressure, the huge egg farm told the distributor that they could buy the eggs at a lower price. The distributor said, " I don't have the room for the %$&^*&% eggs even if they were free".

The distributor told the grocery store owner that he would lower the price of the eggs if the store would start buying again. The grocery store owner said, "I don't have room for more eggs. The customers are only buy 2 or 3 eggs at a time". "Now if you were to drop the price of eggs back down to the original price, the customers would start buying by the dozen again".

The distributors sent that proposal to the huge egg farmers. They liked the price they were getting for their eggs but, them chickens just kept on laying.

Finally, the egg farmers lowered the price of their eggs. But only a few cents. The customers still bought 2 or 3 eggs at a time. They said, "when the price of eggs gets down to where it was before, we will start buying by the dozen."

Slowly the price of eggs started dropping. The distributors had to slash their prices to make room for the eggs coming from the egg farmers. The egg farmers cut their prices because the distributors wouldn't buy at a higher price than they were selling eggs for.
Anyway, they had full warehouses and wouldn't need eggs for quite a while.

And them chickens kept on laying.

Eventually, the egg farmers cut their prices because they were throwing away eggs they couldn't sell. The distributors started buying again because the eggs were priced to where the stores could afford to sell them at the lower price. And the customers starting buying by the dozen again.

Now, transpose this analogy to the gasoline industry.
What if everyone only bought $10.00 worth of gas each time they pulled to the pump. The dealers tanks would stay semi full all the time. The dealers wouldn't have room for the gas coming from the huge tank farms. The tank farms wouldn't have room for the gas coming from the refining plants. And the refining plants wouldn't have room for the oil being off loaded from the huge tankers coming from the Middle East.

Just $10.00 each time you buy gas. Don't fill it up. You may have to stop for gas twice a week but, the price should come down.
Think about it.

As an added note...When I buy $10.00 worth of gas,that leaves my tank a little under half full. The way prices are jumping around, you can buy gas for $2.65 a gallon and then the next morning it can be $2.15. If you have your tank full of $2.65 gas you don't have room for the $2.15 gas. You might not understand the economics of only buying two eggs at a time but, you can't buy cheaper gas if your tank is full of the high priced stuff.

Also, don't buy anything else at the gas station, Don't give them any more of your hard earned money than what you spend on gas, Don't buy your morning cup of coffee,doughnuts and soft drinks, magazines and newspapers, alcohol and tobacco. Buy them somewhere else. Don't buy anything until the prices come down below $2.00 a gallon. Buy these items elsewhere. After about a month 7 eleven, Circle k, Stop and Go, and all the other stores who sell all of these over priced items will be screaming at the oil companies and the government to lower fuel prices.
The law of supply and demand always works.
When the demand is high, prices are high.
When the demand is low, prices are low.
It's time to tell the big corporations, they need us more than we need them
Everyone should read this and send it on.

AaronK
11-08-2005, 08:47 AM
Its a nice thought, but if I only bought the gas that I needed I'd be at the gas station several times a day. At least when I fill the tank, I can at least make sure I'm getting the best price at that second by deciding which gas station I go to.

mishka422
11-08-2005, 09:01 AM
It would certainly be worth the multiple trips to the gas station if it might help bring the prices down. I have watched the price at the station I always fill up at drop approx. 25 cents a gallon just in the last week. GO FIGURE!

summergirl825
11-08-2005, 09:32 AM
Ever since gas has been skyrocketing I fill up at a 1/2 tank. My reason for doing that was it doesn't hurt the pocket book so bad! I know, I know I'm just fooling myself, I still use the same amount of gas!

Gigs
11-08-2005, 09:46 AM
How in the hell can you buy two eggs at a time?

ebrener
11-08-2005, 01:01 PM
The flaw with the egg buying (besides being able to buy 2 at a time) is that thrugh the course of a week, demand hasn't changed. You still buy a dozen eggs, whether you buy them all at once or 1 at a time. You, and everybody else, don't consume more because you bougth the full dozen (at least not in the scenario presented). Since demand from the end customer hasn't changed, demand from the store shouldn't either, and so on, so at worst, there would be a change in the distribution schedule or pattern, but not on the amount sold.

Gigs
11-08-2005, 01:27 PM
Also, If I bought $10 worth of gas every time I filled up and that's it, I would need to stop twice on my drive home from work!

REDJIM
11-08-2005, 06:54 PM
Good Analogy summergirl. I think it tells us that the CONSUMER should always be in charge of the economy--not the producer, or the government!

Producers are Stupid(I work for one!) and The Government is even more Stupid!

The economic power of the consumer must be served in this "New World Economy" fashioned by the Democrats and Socialists, and embraced by the Republicans. Elsewise, the Great Old US of A will become simply an historical icon like Greece and Rome.

The Framers Of The United States Constitution are insulted by the "regency" mentality exercised on Capitol Hill today--and we should be too.