stimulus (part 3)

Everyone knows the law of supply and demand: when demand is greater than the supply, the price goes up (the scarcer the product, the stiffer the tag); and on the reverse side, when supply overwhelms the demand, the price goes down, sometimes at giveaway rate.

The market has a mind of its own. When the price is upped, the demand gets lower; when price is lowered, consumers scamper for the product and the demand meets the supply head on. In effect, the reaction on both sides is the market's own way to correct discrepancy.

But sometimes, despite this built-in tendency for the market to find the "common" niche between supply and demand, some entrepreneurs are not enterprising enough to realize the will of the market. This is called greed and as all greeds go, the result is often ugly.

80's Philippines is a case in point. There was a time when a brilliant baker came up with a special oven that did great hot-pandesal. The demand was overwhelming and consequently, the price of the bread went up. The demand went even higher and capitalist copycats decided to join the bandwagon. They set up their own hot pan-de sal stalls and in due time, every corner was a veritable hot pan de salan. As a result, the industry which was bread and butter for legitimate longtime bakers, became a fallen industry, ironically, despite the natural power of yeast to raise the dough.

Then came lechon manok, and it was a part 2 of the hot pan de sal phenomenon.

And as I'll discuss later, people never seem to learn.

(to be continued...)