All Commentary
Friday, April 1, 1966

The Market Price of Burros

Mr. Bellerue operates a cactus-growing busi­ness in the high desert area of Southern Cali­fornia. He was President of the Desert Elec­tric Cooperative in Twenty-nine Palms, the members of which recently elected to sell the business to the Southern California Edison Company to avail themselves of the lower rates offered by private enterprise.

This article is reprinted by permission from the February 6 issue of The (Santa Ana) Register, a division of Freedom Newspapers, Inc.

Several years ago, my wife and I purchased a string of four bur­ros for our family. We built a stable and corral out of wood and assigned each of our daughters a duty-day to perform the required chores for the animals. The sale price of the burros was $200 and the material for the stable cost $100.

For a number of months we had great fun and the children will­ingly did their chores. They did not even object too much, at first, to the forced hikes in the hot desert sun to fetch Daddy and the truck to tow a balking burro home.

We never ceased to marvel at how any one of the burros, in the midst of a twenty-mile-per-hour gallop, could spontaneously come to a dead stop. Unfortunately, none of the riders in our family could ever achieve this feat at the same time as the burro did. We were able to achieve the dead stop all right, but always at least twenty feet beyond the burro.

Needless to say, interest in burro-riding was waning; and it was a good thing, because our time and efforts were now being consumed hunting the critters. Nearly every morning we would find they had eaten their way out of the corral. What an appetite they had for wood! We thought they might need more exercise and that a larger area to romp in might solve the problem; so we fenced in the entire fifteen acres with barbed wire. Our total in­vestment was now well over $600, and the price of feed was increas­ing every month.

Do you think those burros ap­preciated what we did for them? No siree! They spent every day on the family patio and their nights were spent trying to break into the house. The day after they ate the wild bird feed, wooden feeder box and all, we sold the entire lot to a local horse trader for $100. Peace and tranquility has returned to our Rancho. Even the horse trader is happy because he sold them the next day for a profit.

This brings me to the subject of market price and value. The value of those burros to me was something less than $100 at the time of the sale. To be truthful, I might have paid someone to take them. The value of the burros to the horse trader was more than $100 or that amount for which he could sell them and still make a profit. Value, therefore, is com­pletely subjective. Market price, however, was that figure mutually agreed upon, wherein we both could benefit from the transaction, based upon our own subjective values at opposite ends of the cushion of profit.

One may mistakenly think that I did not gain when I first pur­chased the burros. It must be re­membered that their value to me at that time was higher than when I later sold them. In other words, at the time I purchased the bur­ros, I wanted them more than I wanted the money I voluntarily paid for them. Therefore, I gained from the original purchase as well as from the sale, when I couldn’t get rid of the ornery critters fast enough. The market price of bur­ros, as well as of everything else, can only be determined by the buy­er and the seller and their respec­tive value judgments at the time of the transaction.



Mutual Gain

So long as the basic right of ownership is preserved, a contem­plated trade is never a conflict; it is an attempted act of coopera­tion under which both parties, not merely one, stand to benefit.

F. A. HARPER, A Just Price and Emergency Price Fixing