Weekendy Summary

The weekend came and went. I finally laid the last stone in the last place on the damned wall (at least for now); all we need now are capstones and compost, and we'll be ready to plant again next spring.

We took the girls to Oloteas, where they had a great time. The ritual was completely sung and quite well done. Kouryou-chan and Yamaraashi-chan tried to convince me that they could swim reliably and, well, they could for the most part. I am most pleased, but now I need to find them a swimming pool for the fall and winter so they don't lose the skills they've acquired. I should remember to bring shampoo and conditioner; Yamaraashi-chan's hair is very susceptible to chlorine.

I had gotten it into my head to bake fresh bread for Oloteas instead of just bringing something from the store, so I quickly kneaded out two loaves of French bread made with a small amount of amaranth flour, which gave it a texture with more moisture and thickness than a traditional French bread. Although there was enough to eat at the table, I think a lot of people wimped out and bought store-made bread, chicken, and even Doritos.

We had dinner with the very lovely KaeliSinger and her two delightful children. Someone asked the obvious question of the table: why is Frito-Lays not behind the legalization of marijuana? You'd think they'd be one of its biggest supporters.

Sunday, after a breakfast of French toast (made with the leftover bread mentioned above, natch) I finished the wall and Omaha leveled out the ground behind it for the garden. Omaha bought a new hard drive for her computer, and I found a $2 cable extender for the rear fan, meaning I can now close the case on my computer. While we were doing that, we downloaded about a hundred megabytes of new Quake 4 levels, only to find that one of them corrupted the entire Quake 4 engine and now we can't play. We'll have to re-install. Suck! We went to some household goods store and got lots of new towels in candy colors, new high-thread-count bedsheets, as well as individualized clothes hampers, all for the girls.

We picked an entire pound of blackberries. After a dinner of pizza (Yamaraashi-chan and I both like mushrooms, yay!) we let the girls watch Sleeping Beauty before Omaha shuffled them off to bed and I cleaned up the kitchen. I went to bed early: tomorrow is gonna be a long day.

Interesting point on why gas prices rise quickly...

Imagine that you own a storage tank full of gasoline that is currently worth $2 a gallon at wholesale prices. It is widely believed, however, that the price of gasoline will be $2.10 next week. You would be crazy to sell your gasoline now: just wait a few days and the higher price will be yours. But if everyone waits a few days, there is no gasoline to be sold now and the resulting shortage pushes the price of gasoline up. How high does it have to go? The answer is $2.10 a gallon. That is the price necessary to induce those who have gasoline to sell it now rather than to wait till next week.

This argument does not depend on whether you think the gasoline market is a paragon of perfect competition or an evil oligopoly. All it requires is that you believe that people who own gasoline, like just about everybody with something to sell, prefer to receive a higher price rather than a lower price. Even if the price of gasoline were set by a perfectly benevolent conservationist, we would expect to see the same pattern of price movements

The Rapidly Changing Signs at the Gas Station Show Markets at Work

[Edit: It occurs to me that Varian is wrong in his second paragraph: it is not true that people prefer to receive a higher price than a lower price per unit sold. What entrepeneurs are trying to hit is that sweet spot where the price X unit brings the greatest margin of operation. If Varian were correct, the price would never come down.]

Unfortunately, Varian's article doesn't address the counterpoint: why do gasoline prices fall so slowly? Gasoline prices at the pump are a combination of three factors: the wholesale price of gasoline, plus the minimum markup needed to sustain the business, plus whatever the seller can get out of the buyer. Having discovered that they can sell gasoline for $2.10 a gallon, why should the price come down? Because the neighboring station, in the hopes of increasing his profit, lowers the price a penny: there's then a slow race to eliminate the third factor of the price differential, both of them hating the other for it.

I'm not sure I buy Von Mises's assertion that even if we allowed the gas sellers to cartelize on setting a price, there would be cheating that would still force the slow race to the bottom. The premise of this assertion is that if a dozen sellers set the price at $2.10, and one cheats and sets it at $2.08 the rest would have to drop to that price or suffer a customer differential, and all that's necessary to ensure that the cartel is ineffective is to prevent the 11 cartel members from somehow influencing the cheater with initiatory violence.