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Re: Daylily Vs. Hosta

Thanks to Joe, I think my thesis is proven. I just have to twist his words
around a bit.

And so we begin again:

halinar@open.org wrote:

> Only SOME daylily people are nuts!

Yes, that is obviously true.  The people who grow daylilies and do not pay
artificially high prices for them certainly cannot be faulted or
disparaged.  It's just more fun to disparage the whole lot of them.

> You are assuming that Economics 101 is at work here.  The law of
> supply and demand isn't perfect and isn't without its rough edges.
> The daylily market is more like the diamond or art market then an
> agricultural market.  There is a lot of daylilies on the market, or so
> it appers, but in fact a lot of these daylilies are not in much
> demand.  Every year there are only a few dozen daylilies that really
> attract a lot of attention and demand.  The big named hybridizers keep
> the supply on the short side so they can keep the price up.  Even
> though several hundred daylilies may be offered for sale every year,
> in fact relatively few of them are hot items that attract a lot of
> attention.  Thus, there appears to be an over abundance, but in fact
> there is a lot more demand for a limited number of these
> introductions.

Exactly.  Well, almost exactly.  I would say that it is similar to the
diamond market, rather than the art market.  Diamonds have an artificially
high value only because the supply is controlled.  There are more diamonds
in the world than anyone could possibly need, but they keep them off the
market so the prices remain high.  I am proud to say that no one in my
immediate family has ever bought a diamond, and while I don't want to
start another controversy (who me?), I have to admit that I think people
who buy diamonds are nuts too.

Hostas, on the other hand, are more like art.  If someone makes a lot of
copies of a piece of art, if everything is on the up and up, they do not
try to sell them as valuable works of art.  They are sold as low cost
copies.  There are some people who can afford and find pleasure in owning
the expensive originals, which are rare, and there are others who are
perfectly happy with the copies.

Now I realize that on the whole, daylilies work that way too, but my
thesis hangs on the proposition that even though there should be expensive
daylilies, just as there should be expensive hostas, there should not be
hundreds and hundreds of them.  There are many daylily growers, and these
growers offer many varieties of expensive daylilies, and presumably each
grower has a number of plants to sell.  That means that there are probably
thousands of individual plants available to someone looking for a top
quality daylily.  If daylily people weren't nuts, they would realize this,
would stop paying so much for plants that are not really in short supply,
and the price would fall to a level that would be reasonable.  Much as
hosta people have done.  Hosta nurseries have not dropped prices
dramatically over the past few years because we felt sorry for our
customers.  We did it because The Law of Supply and Demand required it.

Once again, when faced with a choice of hundreds of excellent daylilies,
if our imaginary daylily buyer can only be satisfied with a particular
one, then he or she has to pay the going price.  But if that person is not
nuts, or the group as a whole is not nuts, they will buy another daylily
that doesn't cost as much.  Maybe not $20, but say $80. Still probably a
damn fine daylily.  Were these people not nuts, sellers would soon realize
that in order to sell their plants they had to put a reasonable price on

> On top of this you have to throw in the snob factor.

I did.  I just called it the daylily people are nuts factor.

> Now, there is one more important consideration that messes up the
> Ecomonics 101 theory.  The law of supply and demnad works only the way
> you think it should when you have a real business - real buyers and
> real sellers.  If I had a full time job making $50,000 and I had a
> wife making $50,000 and I was hybridizing daylilies and I had some
> really nice seedlings I could price them at $100 or $150 and it
> wouldn't make any difference to me if I sold 10 or 20.  If, however, I
> had my own nursery business and hybridizing and selling daylilies was
> my total source of income, then I have to consider how to maximize my
> income/profit on each introduction.  The hobbyist hybridizer/grower
> doesn't have to consider this as much.

Yes and no.  The Law of Supply and Demand does not require a seller to
sell at a reasonable price.  It simply says that if there are buyers, and
you price too high, if there are no barriers preventing new sellers from
entering the market, Walmart is going to come in and kick your butt.  If
your hobbyist doesn't want to maximize his profit, someone else should
enter the market put them out of business.  And that should start a
process that would bring daylilies down to an appropriate price,
determined by the market.  I think this is happening in the hosta world.

In the daylily world, rather than obey The Law of Supply and Demand, the
buyers have opted to plead insanity.


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