This is the perennial problem in our society with regulation. We're not willing to set the penalties high enough. The penalties need to be absolutely ruinous.
The Egg Bandits Made a Thousand Times the Fine They Just Paid for Price Fixing
151–160 of 270 posts
Re: The Egg Bandits Made a Thousand Times the Fine They Just Paid for Price Fixing
#152I did not realize the egg crisis was found to be price fixing operation. As I recall during the whole thing the news was non-stop about how it was related to broad-based inflation, chicken culling for avian flu, etc. Seems like all that was a lie, or at least merely a half-truth.
It was 100% due to Biden. (Or so I was told. Might even be the reason we have Trump 2.0?)
Yeah, he's definitely the cause of all our past and current problems.
Re: The Egg Bandits Made a Thousand Times the Fine They Just Paid for Price Fixing
#153Things like this mainly occur in markets with little competition, killing of small business causes issues like this. Much of our grievances are caused by our high level of market concentration.
I think perhaps the USA's modern decline right into the toilet is the result of changes made in the 80's, like gutting anti-trust. What we're seeing now is just the visible manifestation of corruption that has been allowed to grow and metastasize since then.
Re: The Egg Bandits Made a Thousand Times the Fine They Just Paid for Price Fixing
#154Earlier quoted context omitted.
Never let a good crisis go to waste, or so the saying goes. The consolidation of food production in the US is a risk to us all.
have you ever seen the documentary food inc?
Re: The Egg Bandits Made a Thousand Times the Fine They Just Paid for Price Fixing
#155Earlier quoted context omitted.
The major egg supplier for most of the grocery stores decided not to buy as many pullets to replace the ones they culled from Avian Flu, and then the second and third largest also followed suit. As a result there was a bug supply crunch that coincided with Avian Flu cullings. Unless Biden was there making command decisions about how many pullets to buy that year he had nothing to do with it.
Not disagreeing, but all I heard was Biden-flation (or whatever they called it) was why we needed a new President.
If all you needed was a new president you could have chosen the other option.
Re: The Egg Bandits Made a Thousand Times the Fine They Just Paid for Price Fixing
#156Things like this mainly occur in markets with little competition, killing of small business causes issues like this. Much of our grievances are caused by our high level of market concentration.
This was addressed by Matt Levine in today's Money Stuff. The problem was not the presence or lack of competition, it was a technical failure of the market structure. Matt: This is a familiar story and you probably know the ending. There’s a big market (egg producers selling eggs to supermarkets etc.), and there’s a small market (egg producers selling extra eggs to each other on an electronic exchange). The price in…
> "show me the incentives and I will predict the outcome" thing
There are supposed to be two stopgaps here.
First, the fear of going to jail for committing crimes. Secondly, the social reprisal for committing crimes that hurt people.
Like seriously these CEOs shouldn't be welcome at anyone's table or gathering in polite society as a result of their actions, bare minimum. The government should also put them in prison.
Re: The Egg Bandits Made a Thousand Times the Fine They Just Paid for Price Fixing
#157Earlier quoted context omitted.
While Matt is technically correct, it's much easier to maintain a conspiracy like this when you have a small number of participants with a high concentration of share. If power is more diluted among a greater number of participants you are way more likely to see defectors, which would provide accurate pricing data to the market and cause the conspiracy to fail.
Can that be reduced to Prisoners Dilemma game theory?
Yes. Specifically in this case, "defect" is the good case and cooperate is price fixing cartel. So with more prisoners, the chances of someone choosing defect goes up. So then everyone else choose defect, breaking up the price fixing cartel, leading to market forces working and lower prices for consumers.
Re: The Egg Bandits Made a Thousand Times the Fine They Just Paid for Price Fixing
#158Earlier quoted context omitted.
Executives will be more afraid of being sent to prison for criminal charges, than having someone else's money get spent on fines. We can do both - increase the fines and set a precedent of arresting executives when their company does criminal things.
In a large enough organization with many layers to it, it very well may be that executives were neither involved nor aware of criminal wrongdoing, and even when they are, you'll never find sufficient evidence to charge them. That's largely the point behind performing criminal acts as a business and why there's so much white-collar crime. At least if you set fines to a level that such crimes are rarely if ever profita…
In this case they have literal correspondence between the CEOs.
Re: The Egg Bandits Made a Thousand Times the Fine They Just Paid for Price Fixing
#159Wow, well I have egg on my face. I have frequently used this as an example of the "oh so the egg guys got greedy and then got saintly" to parody the idea that price is primarily determined by greed. Welp! Now to see if I can eke out some pride by finding out what percentage of the price fluctuations was due to coordination. > During the 2024 campaign, when Kamala Harris meekly suggested price gouging to tame inflatio…
A thing can have many causes. One is the direct cause: the city exploded because someone pressed the button to launch the nukes and left the coordinates set to zero. Even more direct: the city exploded because a critical mass of uranium was assembled. There can be many indirect causes: someone put an idiot in charge of the nuke-launch button, someone forgot to put a molly-guard on the nuke-launch button, someone inve…
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Re: The Egg Bandits Made a Thousand Times the Fine They Just Paid for Price Fixing
#160> Basically, consolidation had created concentrated power, and the shock of let them exploit it. Once you see this pattern, you see it everywhere. >While most normal people at the time thought someone was likely scamming them, that is not the message you heard from the industry, elite media, or economists. Throughout the alleged conspiracy, industry executives and analysts were saying that there was nothing to see ex…
>The idea that something more nefarious than the bird flue was going on was very unpopular on HN at the time Because journalists see conspiracy everywhere. It is prudent to wait a bit before seeing malice everywhere Now we know (or at least - have more proof) what was going on, so the justice system worked. How many conspiracy theories were invented and then turned out to be false? This is news precisely because it t…
> Because journalists see conspiracy everywhere.
To be fair, journalists also seem to miss even when there is an obvious conspiracy. They are a varied bunch.