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September 27, 2008
RAND SIMBERG WONDERS if gas lines in the South are being aggravated by anti-"price gouging" efforts. He may be right. Knoxville had shortages and high prices, but no lines. Other places seem to be facing shortages and lines, but not such high prices. Five-dollar gasoline does discourage people from topping off every time their tank drops below 3/4.
UPDATE: More on Charlotte's situation here. And reader Robert Evans writes: "In Charlotte, as the article states, there is a low per capita amount of pumps available. Radio and TV stations have been panicking people by reporting shortages, causing runs on the stations, similar to the runs on bread and milk at groceries when a snowstorm is reported."
Yes, especially with just-in-time inventories, you can create a shortage, and more panic, just by reporting on a potential shortage and panic. Can the press learn a lesson before we get bank runs the same way? I mean, without help from Charles Schumer.
ANOTHER UPDATE: Reader G.L. Carlson emails on Knoxville:
The panic-induced K-town gas shortage of a couple weeks ago was clearly created by the world-is-ending print story, picked up by other media.
Allowing prices to float to you-gotta-be-kidding, I'll wait! levels equally quickly damped out the panic.
Market driven negative feedback works. Eliminate the feedback, or use positive feedback, and you get what you deserve.