Knock Knock You're Dead

CATO has put together a Google Map featuring botched SWAT raids across the country. Check it!

[via Glas]

The Self Correcting Market

When college students need a mental boost to study for exams, they often turn to Adderall. These pills, which generally sell for $3 a piece, tend to increase in price to $5 around exam time.

One student reports that in his suburban Dallas hometown, drug dealers, realizing this price variation, speculated by buying up large supplies of the drug at $3 and dumping them on the market during exam time, hoping to sell at $5.

They didn’t realize that this large increase in supply would cause the price to drop below $5. Indeed, so many dealers engaged in speculation that there was a surplus at the usual equilibrium price of $3. Students were able to buy the drug for only $2 as dealers sold off their excess supply. One imagines that the dealers were less enthusiastic about speculation the next year and that the exam-week price stayed above $3.

I wonder where the bailout is for the Adderall dealers who speculated and lost. Apparently they just weren't "too big to fail."

This adds further evidence to my point, that though speculation happens, if you allow it to run its course and speculators face the consequences of their bad decision, they will not make the same mistake again.