4 Board Members of Enne Superstores Arrested in Venezuela for Food Hoarding

[naaman fletcher]

8. in every case

where governments who don't know econ 101 and they cause shortages they ALWAYS blame hoarding.

Now, think this through a bit: What could this grocery store gain by hoarding? Remember, the stuff was in their warehouse so they paid for it.

They are out good money to just let products rot in their warehouse. To what end? OK, maybe they want to bring down the government. So they keep product in their warehouse. What happens then? People go to other stores and buy from there and they lose market share.

None of it makes sense.

What would happen in the US if Walmart did that? People would go to target. OK, maybe target wouldn't be prepared so there would be shortages for a few weeks as Target has to double it's orders from suppliers, but that's it. Just a few weeks. Meanwhile Walmart would have run itself out of business.

It doesn't make sense. It doesn't happen. It is basic economics.

The far more likely scenario is that these guys simply had a warehouse, and maduro needs someone to blame. Of course, Maduro just made a deal with Polar so a different scapegoat had to be found.

None of it makes sense if you know econ 101.


EDITED TO ADD: To be clear, hoarding can cause short run supply problems, but not long run. The hoarding causes prices to shoot up, causing producers to produce more which fixes the problem.