[Kellis91789]

[There is neither a family nor a company on the planet which will engage in the analysis you suggest for the pricing of a flat panel LCD.]

Oh, ye of little faith !

These decisions are made intuitively by every consumer with every purchase. Every purchase contains a subconcious evaluation of the price of a product relative to all other items they could purchase. That's what a market IS -- consumers choosing and dictating the prices by their choices.

Do you honestly believe that a consumer doesn't look at two items -- even completely unrelated items -- and decide which one gives them the most bang for their buck ? Do you think people look at a restaurant menu and decide what to eat solely based on what sounds good ? So if they are in the mood for a steak, they will never be swayed to something else based on the price differential ?

What a strange world you must live in.

[Dimples]

You are making my arguement for me. It is precisely because not every decision is purely analytical that prices will not behave in the manner you insist. For your scenario to come to pass, EVERYONE must have perfect trust, perfect foresight, perfect capital mobility and perfect fairness (and that's what the simulations expect, by the way.)

If ANYONE deviates by maximizing their own situation under a new, untested tax regime, then BY DEFINITION, prices MUST rise higher than the levels that you claim.

It is not me living in the stange world ... I EXPECT people to behave outside the parameters of the plan.