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H-E-B adopts rationing policy to address national egg shortage

Posted by $ rockymountainpirate 5 years, 4 months ago to Economics
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Watch for the coming Turkey shortage in a few months also. Millions of Turkeys were put down in Minnesota alone due to Avian Flu.
SOURCE URL: http://www.bizjournals.com/sanantonio/blog/morning-edition/2015/06/egg-shortage-affecting-whataburger-now-h-e-b.html


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  • Posted by Lucky 5 years, 4 months ago
    Rationing is an attempt to be 'fair' in the allocation of scarce resources.
    For a good exposition of what the word 'fair' means see very early in Atlas Shrugged when Dagny talks to Jim Taggert about buying rail, Jim says 'It isn't fair'.

    This story, may, possibly be true- 1950-era Eastern Europe.

    There is a rumor that meat is available, a long line forms outside the meat market.
    At 8 in the morning the market door opens, and a man steps out.
    He announces, "There is not enough meat for everyone.
    If you are Jewish, you might as well go home." Several people leave.

    At 10 the door opens, the man steps out and says,
    "I'm sorry, but there is not enough meat.
    If you are not a Party member, you might as well go home."
    Most of the people leave.

    At 4 PM the man appears again and says,
    "I'm so terribly sorry. There isn't any meat at all."
    One Party member turns to another and grumbles,
    "Isn't that the way it always is? The Jews get the best of everything!"
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    • Posted by $ nickursis 5 years, 4 months ago
      That goes back to the barrage of pictures that used to go through the newspapers showing the Russians in Moscow always waiting in line. The joke was a Muscovite would always get in line and wait, just in case something good was on the other end. Then they had the "Party" shopping store which was huge and always seemed to be full of goodies. Only certain party members and diplomats could get in, so the US diplomats would take sneaky pictures in side and they would publish them in the papers to show how stingy the Commies were. Socialism at it's best....
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  • Posted by $ minniepuck 5 years, 4 months ago
    I shop at Central Market, which is owned by H-E-B. I went there today, and the only thing I saw was a sign at the egg section saying they are not selling eggs to commercial clients. There was no 3-carton limit.
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    • Posted by TheRealBill 5 years, 4 months ago
      Yes, this is aimed at not running out of stock when a local restaurant comes in and buys out most of your eggs. HEB has the family and individual as their primary market. If the family shopper can't get what they need they go elsewhere, which cuts into sales of other things. It is in the enlightened self-interest of the powers that be at HEB to keep the core of their business happy.

      As usual hyperbole and a rush to judge and post causes claims of rationing and conspiracy, rather than applying reasoned thought and investigation.

      Proclaiming conspiracy takes virtually no brain cells. Looking into things and applying thought reason is orders of magnitude more effort.
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  • Posted by WilliamCharlesCross 5 years, 4 months ago
    I'll count myself lucky (so far) to live in the relatively isolated North Country of New York State. I can get eggs from organically raised chickens at my gym.
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    • Posted by $ 5 years, 4 months ago
      Your gym raises chickens?
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      • Posted by WilliamCharlesCross 5 years, 4 months ago
        Actually, the owner of the building is a farm owner, so the eggs go in the refrigerated unit holding the energy drinks and such. Everyone who buys eggs brings back the empty cartons for further use.

        This is a really small town :)
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        • Posted by $ 5 years, 4 months ago
          I live in that kind of town too. Lots of chickens and eggs around here. Of course here chickens are also referred to as a Grizzly Dinner Bell.
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          • Posted by Timelord 5 years, 4 months ago
            Grizzly dinner bell?!

            Ahh, I think I got it - the noisy chickens attract bears! In the N.E. It's mainly foxes and fishers and maybe coyotes.

            When I was a lad we raised about 40 turkeys for a few summers. Predators weren't a problem because those birds spent nights roosting in a 60' tall hemlock tree. In the A.M. when we went down to the pen to dole out the grain you'd have 40 kamikaze turkeys launch out of that tree and crash land at your feet!

            Yummy free range turkeys, the smallest one dressed out at 22 lbs. Friends and neighbors who bought them complained about having to buy larger roasting pans...
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  • Posted by SaltyDog 5 years, 4 months ago
    See? That's the kind of business altruism that I applaud. The chain has CHOSEN (do you understand that word, members of the ruling class?) to restrict sales so individual households can get some eggs. That's the kind of ethos that I like to see!
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    • Posted by $ CBJ 5 years, 4 months ago
      Not necessarily altruism, it also helps protect the store's customer base. If customers can't buy eggs there, they would go to a competitor for eggs and might never return!
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      • Posted by SaltyDog 5 years, 4 months ago
        You may well be right. My main point however is that the business itself making the call...not some bureaucrat ordering it in the interest of what he or she considers "fair".
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  • Posted by UncommonSense 5 years, 4 months ago
    But is the flu real? Or is it a gov't-mandated killing, engineered to induce an artificial shortage & thus raise prices for poultry & eggs? The price of beef is going up, now poultry & eggs. Medical care, food in general, college education...I mean come on already. It getting so out of control.
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    • Posted by $ MichaelAarethun 5 years, 4 months ago
      30% was the figure given back before mandatory ethanol production was made a law. It sucked up the available grain crops for human and animal consumption. Some worried about foreign aid and Congress said no big deal we'll put another 700 million in the pot. Meanwhile we hear complaints of children starving? Starving with all these food banks and we have food to give away? Control money, food, medicine, education and housing Next thing it will be the shirt off your back.
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  • Posted by nsnelson 5 years, 4 months ago
    This is absurd. It violates what should be economic common sense. Nobody who wants eggs in Texas will not be able to get them. Rationing does not work. These businesses are missing a great opportunity to increase their profits, and thus their ability to obtain more eggs. They would be accused of price gauging if they did this, but this is the best way to efficiently distribute scarce resources, and to provide the resources to resolve the problem.

    Hazlitt has a great chapter on this in his Economics In One Lesson. Here is my summary:

    Chapter 17. Government Price Fixing. As seen in the previous chapter, efforts to artificially fix a price above current market levels doesn’t work. Neither does fixing it below the current value (usually attempted during wartime, and often lingering after). Unfortunately, this has the advantage of making politicians popular with consumers. They argue that prices should be based on what people need rather than how much they can pay; they aim to keep the cost of living from rising.
    All price fixing increases demand and reduces supply (because profit margins are diminished, and marginal producers are put out of business). To avoid shortages, politicians try rationing, cost-control, subsidies, or universal price-fixing. Rationing limits the price and the quantity purchased (just like a free market would), but it does not stimulate production (like a free market would). Cost-control merely creates shortages of the items being controlled. Subsidies benefit the consumers, especially the wealthy, at the expense of the producers and the tax payers.
    Price-fixing enables tyranny because fixing one item will lead to fixing another, and “A power over a man’s subsistence amounts to a power over his will” (Alexander Hamilton).
    Price-fixing encourages the black market, causing harm “both economic and moral” (the black market is inefficient, and temps consumers to break the law). Politicians try it because they fail to understand that prices and shortages are caused by true scarcity or increase money supply. “Each one of us is a producer [wanting inflation], taxpayer [resenting subsidies], and consumer [wanting price control].” Each may seek political power for personal benefit, but they are deceiving themselves. “For not only must there be as much loss as gain from this political manipulation of prices; there must be a great deal more loss than gain, because price-fixing discourages and disrupts employment and production.”
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  • Posted by $ Radio_Randy 5 years, 4 months ago
    Reminds me of the gas crisis in 1979. I was moving from California to my home state of Washington, driving a large U-Haul truck, with my car in tow and probably getting 5 miles per gallon.
    One gas station I stopped at had a 5 gallon limit! Really...! So...I drove down the block and filled up at the next station (who didn't have a limit).
    I wonder who the winner in THAT contest was.
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  • Posted by waytodude 5 years, 4 months ago
    Raise my own eggs and meat chickens. Hunt for wild turkeys if I want turkey. Living in my gulch and watching the world flailing like a hurt chicken priceless.
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  • Posted by Herb7734 5 years, 4 months ago
    And so it begins.
    Food shortages in the USA?
    Atlas' greatest creation whose prosperity was the wonder of the 20th century is running out of a staple food? What's next? The Pirate says it'll be turkeys. I wonder what will happen if it becomes less marginal foods. A.R. was no Nostradamus, but A is A and if certain people create certain events as promulgated in the novel -- there will be shortages. I wonder how our millions of mooches with their jaws wide open like newly hatched birds will react when nothing falls into their open mouths.
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    • Posted by CircuitGuy 5 years, 4 months ago
      "And so it begins. Food shortages in the USA?"
      I say no way. I will be shocked if anyone who wants eggs in America can't get them. Save this comment. I'm saying categorically that it will not happen.
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  • Posted by Ibecame 5 years, 4 months ago
    Rationing: A technique to raise the price of some item and thereby increase profits.

    How can there be a shortage of eggs from an event that happened two months ago when the eggs in the stores have been in cold storage for a minimum of two years. Yes, this is true. Eggs keep for a very long time and are one of the items on the commodities market, along with pork bellies, ham, grain, corn, ........and the list goes on. Big investors and companies started buying and then selling when "Profits were higher" a long time ago. Simple economics, eggs from two or three years ago are sold at a higher price today. If you doubt this look up the Mill-spec on cold storing eggs. Three years for cold, 7 years for frozen. If you want "fresh eggs" by a chicken.
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    • Posted by $ CBJ 5 years, 4 months ago
      Even if current stocks are adequate, a "shortage" can be created by increased demand, sparked by consumers "stocking up" in anticipation of reduced supply and/or higher prices in the future. For example, I usually top off my tank as soon as I see wholesale gasoline prices jump, since I anticipate that retail prices will soon follow.
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      • Posted by Ibecame 5 years, 4 months ago
        In AS Ayn covers the subject of public perception vs reality pretty well. What very few people know is the magnitude of "stuff" stored in coolers and warehouses for the commodities markets. Not to mention the eggs that are stored by the Dept. of Agriculture, or the military. Remember the "Cheese Shortage", that Regan squashed by tapping into the Cheese the government had stored up. Think about it. That program is still going on and they haven't run out yet.
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  • Posted by brkssb 5 years, 4 months ago
    HEB is smart. HEB is not addressing national egg shortage but is more prudently addressing customer base. Store nearby "discounts" eggs regularly at 4 cartons for $5, limit 4 per purchase episode (which means once through the cash register line). Member-type chain store sells eggs in bulk and IS geared up to serve small restaurants. Without government interdiction, the normal feast-or-famine cycles are narrowed by progress in cultivation and supply-demand and the grocers and consumers have become creative in adapting. But the government as we have know it has always [adversely] influenced the producer and the consumer and induced starvation.
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  • Posted by $ Stormi 5 years, 4 months ago
    I am always suspicious, when it involves the food supply. Exactly how did the avian flu get in the area> Remember, Agenda 21 wants control of what we eat as well. O has been pushing get your food withing 100 miles of your home - yeah, get veggies in the Midwest in the dead of winter? I always remember the story of how Khrushchev starved villages who opposed his rise, for his own gain.
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    • Posted by Ibecame 5 years, 4 months ago
      The question to ask is what ex-Cisco systems founder turned turkey farmer (the largest farmer in the US) had the most to loose and who she made large political donations to. Remember this started with turkeys not chickens. Not the turkeys in DC.
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    • Posted by $ 5 years, 4 months ago
      I only know a little bit about the turkey situation. CDC and APHIS don't know how the birds got it, but it was suspected maybe wild birds migrating carried it. They don't even know for sure how it's transmitted. When 1 bird in the barn gets it, they all have to be put down. Also, the farmers don't get their insurance payout if they only take out the sick ones and not the entire barn.
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      • Posted by Ibecame 5 years, 4 months ago
        I read the part about migrating birds to, but it was hard to understand how a sick bird could migrate from Asia to Minnesota. On the other hand, I am glad I don't know how the birds got infected. I wouldn't want to get a lead infection. I seem to be learning that part of being an Objectivist is knowing that the system is going to crash because of its built in flaws and accepting that. Remember what John told Dagney at the Gulches copper mine.
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      • Posted by $ Stormi 5 years, 4 months ago
        We know how easy it is to introduce a bird transmitted disease into the country, especially if there is money at stake. One country who dislikes the US, or stands to make money on it,, maybe a high sign from certain government-connected opportunist , deed accomplished.
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