Week 5 Blog #3

In the article “Why egg prices are a shell game,” by Anthony Mirhaydari, it is brought to attention that there is a rise in egg prices. It says how if there is such an increase in price there has to be an increase in supply and demand. This is great news for the farmers, with a greater demand for eggs they won’t have so much trouble selling there eggs for whatever price they want. Although the negative part is that the egg producers have lowered there flocks and made this demand possible by making a shortage of eggs. This makes it possible to raise the prices for them since the demand for them was small, they tricked the market into believing that the demand was higher because less eggs were being produced. To protect the consumers from what the egg producers are doing, the egg producers are being forced to make bigger cages with less birds in them. I believe that what the egg producers are doing is ridiculous but smart on their part. They are teaming up to control the economy for the eggs and are being able to force consumers to pay for overpriced eggs. They are still smart in doing this because they have found a way to make more money in a falling demand for eggs. They have found a way to no lose money and how to stay afloat in our overpriced economy. The author of this article believes that the “naughty” egg producers will get caught and be forced to have to lower their prices, and in the end will get in trouble and ruin ties with egg sellers. He believes that as time goes on and they keep taking advantage of the prices, they will start getting in trouble and not have a good name in the egg producing industry. The buyers of the eggs who distribute them out to stores will also not want to buy from them because they won’t want to get in trouble with the government.

Article used: http://blogs.moneycentral.msn.com/topstocks/archive/2008/09/25/evidence-points-to-manipulated-egg-prices.aspx?emc=el&m=1596843&l=9&v=e3f55dfac8