Is Supply and Demand too Complex for the Average Voter?

[Ps104_33]

"Some people think that the reason the public misunderstands so many issues is that these issues are too "complex" for most voters. But is that really so?
With all the commotion in the media and in politics about the high price of gasoline, is there really some terribly complex explanation?
Is there anything complex about the fact that with two countries-- India and China-- having rapid economic growth, and with combined populations 8 times that of the United States, they are creating an increased demand for the world's oil supply?
The problem is not that supply and demand is such a complex explanation. The problem is that supply and demand is not an emotionally satisfying explanation. For that, you need melodrama, heroes and villains.
It is clear that many people prefer to blame President Bush. Others prefer to blame the oil companies, who have long been the favorite villains of the left."



http://townhall.com/Columnists/ThomasSowell/2008/05/13/too_complex

 

[billwald]

Problem not supply and demand as much as the trashing of the dollar and the off budget war. The money traders understand much better than the American consumers do.

 

[Ps104_33]

I dont understand. How do the money traders benefit from the weak dollar?

 

[Bro. Curtis]

People should read Ron Paul's explanation of how the free market would work, and the negative influence of the federal reserve.

 

[Ps104_33]

I once read a book called "The Creature From Jekyll Island" By a guy named, I think, Edward Griffin. It was all about the creation of the Federal Reserve and banking. It is not my forte but it was interesting. Money, banking and all that stuff is a little too esoteric for me.

 

[carpro]

People should read Ron Paul's explanation of how the free market would work, and the negative influence of the federal reserve.

But, is he 100% correct?

 

[carpro]

"The problem is not that supply and demand is such a complex explanation. The problem is that supply and demand is not an emotionally satisfying explanation. For that, you need melodrama, heroes and villains. " [/B]



http://townhall.com/Columnists/ThomasSowell/2008/05/13/too_complex

There you have it. :thumbs:

 

[Bro. Curtis]

I'm guessing you'd have to read it. It made perfect sense to me. After reading it, I'm ashamed of the country for allowing it to happen.

 

[billwald]

The money traders don't care if the dollar rises or falls because they make money in either case if they correctly interpret the trend. But they read the papers and know, for example, that our national budget is a sham because the costs of the Iraq war are off budget. In other words, whatever the government claims is the national budget deficit, double it for a more accurate estimate.

 

[Crabtownboy]

I dont understand. How do the money traders benefit from the weak dollar?

It is like the stock market. A savy person can make money regardless of whether the market goes up or down. If it is an up market you buy stocks, this is called buying long, and sell them at a higher price. If it is a down market you sell stock [this is called short selling] and buy them back later at a lower price. It is the same with currencies. You buy the one that is showing strength and sell the one that is showing weakness. For those who sold the dollar short, say 8, years ago, if they buy those dollars back now they will how over a 40% profit. It is all legal.

If the short seller is right then 98% of the time he/she will make money faster than a long buyer in an up market.

There is an old Wall Street addage:

Those who sell what isn't his'in
Must buy it back
Or go to prison.

Selling short your are selling something that you do not own, thus you must at some point in the future buy it back ... you hope at a lower price.