On an e-commerce platform, a limited edition pair of Li-Ning shoes was priced at 49,999 yuan ($7,644), or 33 times its original price (1,499 yuan). The prices of many other shoes and fancy stuff were hiked manifold.
Speculators usually buy such products during special sales and hoard them to later sell them at much higher prices. This kind of over-pricing of products has reached such a stage that some online platforms even attest to the uniqueness of the products being sold at a premium.
The hyped-up products often have one thing in common: They are easy to store, their prices are higher than normal but still affordable, and they are fashionable enough to lure youngsters. Most importantly, these commodities often come in “limited editions”. As a result, speculators, realizing their potential, buy them in bulk in order to sell them at much higher prices later.
Most of these commodities are not really worth the exorbitant prices. No matter how beautiful or unique the pair of shoes, it is ultimately just footwear that can’t be stored forever. The high prices are like bubbles formed due the entry of speculative funds into the market and will burst once the hot money leaves the market.
Those hiking the prices of such commodities are laying traps for unsuspecting consumers, but they may fall into one themselves. Just two years ago, someone in Chengdu, capital of Sichuan province, borrowed more than 10 million yuan from over 130 people with the idea of buying shoes and jacking up their prices. He incurred a huge debt which he could not repay because he could not sell the shoes at the price he needed to.
It is time to curb such activities and let the “visible hand” of the market do its work. Market supervisors need to curb such artificial, irrational hiking up of commodity prices. Even shoe brands should call out those jacking up the prices of their products. And consumers should realize that speculation does nobody any good. They should never put their money into such things.