A man eats two eggs each morning for breakfast. When he goes to thegrocery store he pays 60 cents a dozen.Since a dozen eggs won't lasta week he normally buys two dozens at a time. One day while buying eggs henotices that the price has risen to 72 cents. The next time he buysgroceries, eggs are 76 cents a dozen
When asked to explain the price of eggs the store owner says, "The pricehas gone up and I have to raise my price accordingly". This store buys 100dozen eggs a day. He checked around for a better price and all thedistributors have raised their prices. The distributors have begun to buyfrom the huge egg farms. The small egg farms have been driven out ofbusiness. The huge egg farms sell 100,000 dozen eggs a day to distributors.With no competition, they can set the price as they see fit. Thedistributors then have to raise their prices to t he grocery stores. And onand on and on.
As the man kept buying eggs the price kept going up. He saw the big eggtrucks delivering 100 dozen eggs each day. Nothing changed there. Hechecked out the huge egg farms and found they were selling 100,000dozen eggs to the distributors daily. Nothing had changed but the price of eggs.
Then week before Thanksgiving the price of eggs shot up to $1.00 adozen. Again he asked the grocery owner why and was told, "Cakes andbaking for the holiday". The huge egg farmers know there will be a lot ofbaking going on and more eggs will be used. Hence, the price of eggs goesup. Expect the same thing at Christmas and other times when family cooking,baking, etc. happen.
This pattern continues until the price of eggs is 2.00 a dozen. The mansays, " There must be something we can do about the price of eggs".He starts talking to all the people in his town and they decide to stopbuying eggs. This didn't work because everyone needed eggs.
Finally, the man suggested only buying what you need. He ate 2 eggs aday. On the way home from work he would stop at the grocery and buy twoeggs. Everyone in town started buying 2 or 3 eggs a day.
The grocery store owner began complaining that he had too many eggs inhis cooler. He told the distributor that he didn't need any eggs. Maybewouldn't need any all week.The distributor had eggs piling up at his warehouse. He told the hugeegg farms that he didn't have any room for eggs would not need any for atleast two weeks.
At the egg farm, the chickens just kept on laying eggs. To relievethe pressure, the huge egg farm told the distributor that they could buythe eggs at a lower price.The distributor said, " I don't have the room for the %$&^*&% eggseven if they were free". T he distributor told the grocery store ownerthat 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. Thecustomers are only buying 2 or 3 eggs at a time. Now if you were todrop the price of eggs back down to the original price, the customers wouldstart buying by the dozen again".
The distributors sent that proposal to the huge egg farmers but the eggfarmers liked the price they were getting for their eggs but, thosechickens just kept on laying. Fin ally, the egg farmers lowered the priceof their eggs.
But only a few cents
The customers still bought 2 or 3 eggs at a time. They said, "when theprice of eggs gets down to where it was before, we will start buying bythe dozen."Slowly the price of eggs started dropping. The distributors had toslash their prices to make room for the eggs coming from the egg farmers.
The egg farmers cut their prices because the distributors wouldn't buyat a higher price than they were selling eggs for. Anyway, they had fullwarehouses and wouldn't need eggs for quite a while.And those chickens kept on laying.
Eventually, the egg farmers cut their prices because they were throwingaway eggs they couldn't sell.The distributors started buying again because the eggs were priced towhere 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 pulledto the pump? The dealer's tanks would stay semi full all the time. Thedealers 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 refiningplants. And the refining plants wouldn't have room for the oil being offloaded from the huge tankers coming from the oil fiends.
Just $10.00 each time you buy gas. Don't fill it up. You may have tostop 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 alittle under quarter full. The way prices are jumping around, you canbuy 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 timebut,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 anymore of your hard earned money than what you spend on gas, until the pricescome down..."
Labels: nice break, nice joke, relax, rest
