Although there is never a shortage in everything, a shortage
in just a few important commodities, or even in one, serves to start
speculation. Or again, goods may not be short at all. An inflation of
currency or credit will cause a quick bulge in apparent buying power and
the consequent opportunity to speculate. There may be a combination of
actual shortages and a currency inflation--as frequently happens during
war. But in any condition of unduly high prices, no matter what the real
cause, the people pay the high prices because they think there is going
to be a shortage. They may buy bread ahead of their own needs, so as not
to be left later in the lurch, or they may buy in the hope of reselling
at a profit. When there was talk of a sugar shortage, housewives who had
never in their lives bought more than ten pounds of sugar at once tried
to get stocks of one hundred or two hundred pounds, and while they were
doing this, speculators were buying sugar to store in warehouses. Nearly
all our war shortages were caused by speculation or buying ahead of
need.
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