Economics 101 with Jack White

What's that, Jack? Price is a function of supply and demand?

Eighteen months ago, Jack White's record company Third Man Records was having problems with "flippers" – people who buy the company's ultra-limited-edition releases (the tri-colour vinyl reissue of the White Stripes' first album, for instance, was an edition of five) purely to sell them on for a profit. His solution? Skip the middleman:

This week, Third Man Records decided to beat the flippers at their own game, listing their own limited-edition White Stripes reissues on eBay. Vault subscribers [a paid members' service] were directed to these auctions, where bids have soared to more than $300 (£193).

The winning bid ended up being $510, but White had to face down angry fans, writing:

make no mistake, we could make twenty thousand split color whatevers for you, and they’ll be worth 20 bucks, and you’ll pay 20 bucks for them, and you’ll never talk about them, desire them, hunt to find them, etc. why should ebay flippers, who are not real fans, dictate the price, make all the profit (taken from the artist and the label) and take the records out of the hands of real fans. there’s a guy who waits in a black suv down the block from third man who hires homeless people to go buy him tri colors when they are on sale. doesn’t even get out of his car. should he be charged ten bucks or two hundred? don’t be spoiled, don’t insult people who are trying to give you what you want.

Writing at the Guardian, , a staff member at Third Man, even brought some economic theory into the discussion:

Third Man customers take these limited-edition releases very seriously. Hardcore fans are incredibly dedicated and vote with their money. The more hard to find an item is, the more they want it. It's something of a Veblen good, and that's not a bad thing. But I understand fans' frustration when there is something they cannot get, and by us selling items on eBay it appears we are dangling something in front of their noses and demanding they pay more. We are not. These items will end up on eBay regardless. On an auction site, the customers set the price.

So, economics 101 with Jack White: price is a function of supply and demand. If supply is low and demand is high, the equilibrium price will be high indeed. If the merchant keeps the price artifically low, then there is an opportunity for arbitrage – or "flipping". Either way, the price will end up at its natural level; so you may as well capture that yourself.

Hat-tip to Modeled Behaviour

Jack White sings with his band the Dead Weather. Photograph: Getty Images

Alex Hern is a technology reporter for the Guardian. He was formerly staff writer at the New Statesman. You should follow Alex on Twitter.

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Jeremy Corbyn's speech on terrorism will do him more good than harm

The Labour leader's criticism of police cuts and western foreign policy will resonate with voters.

The election campaign, if there was any doubt, has resumed. In his speech responding to the Manchester attack, Jeremy Corbyn did not limit himself to expressions of sympathy and solidarity. He squarely targeted Theresa May on her home turf: policing and security.

The Conservatives' repeated warning is that Corbyn is a "threat" to his country. But the Labour leader countered that only he could keep it "safe". Austerity, he declared, "has to stop at the A&E ward and at the police station door. We cannot be protected and cared for on the cheap." May, having been warned by the Police Federation while home secretary of the danger of cuts, is undoubtedly vulnerable on this front. Under Labour, Corbyn vowed, "there will be more police on the streets" (despite Diane Abbott's erroneous arithmetic), while the security services would receive whatever resources they need.

Corbyn swiftly progressed to foreign policy, the great passion of his political life. Though it is facile to reduce terrorism to a "blowback" against western interventionism (as if jihadists were Pavlovian dogs, rather than moral agents), it is blinkered to dismiss any connection. As Corbyn noted: "Many experts, including professionals in our intelligence and security services have pointed to the connections between wars our government has supported or fought in other countries, such as Libya, and terrorism here at home" (the Tory-led Foreign Affairs Select Committee is among those who agree).That the former Stop the War chair has long taken this view absolves him of the charge of crude political opportunism.

Corbyn was also more careful than his pre-briefed remarks suggested to caveat his criticisms. He emphasised: "Those causes certainly cannot be reduced to foreign policy decisions alone. Over the past fifteen years or so, a sub-culture of often suicidal violence has developed amongst a tiny minority of, mainly young, men, falsely drawing authority from Islamic beliefs and often nurtured in a prison system in urgent need of resources and reform.

"And no rationale based on the actions of any government can remotely excuse, or even adequately explain, outrages like this week’s massacre."

But he maintained his central charge: western intervention has made the world more dangerous, not less. "We must be brave enough to admit the war on terror is simply not working," he said. "We need a smarter way to reduce the threat from countries that nurture terrorists and generate terrorism."

Though Corbyn's arguments have appalled Conservatives (and some in Labour), they are ones that will likely find favour among the public. Polls have consistently shown that most voters oppose western adventurism and believe it has endangered the UK. Corbyn's words will resonate among both the anti-interventionist left and the isolationist right (this is, after all, a country which has just voted to retreat from even its closest neighbours).

The speech, given at 1 Great George Street (in the room where Ed Miliband gave his resignation address), was marred by Corbyn's refusal to take questions. But it was unarguably well-delivered. "Let’s have our arguments without impugning anyone’s patriotism and without diluting the unity with which we stand against terror," he warned in a pre-emptive strike against the Conservatives.

Corbyn's decision to give an overtly political speech four days after the Manchester attack is being widely described as a "gamble" or even a profound error. But the election will now rightly focus more closely on the issue of security - nothing should be beyond democratic debate.

Many of Corbyn's life-long stances, such as unilateral disarmament, do not find favour with the electorate. But there was little in his speech today that the average voter would contest. The Conservatives will hope to turn the heightened security debate to their advantage, ruthlessly quoting Corbyn against himself. But on this front, as on others, the Labour leader is proving a tougher opponent than they anticipated.

George Eaton is political editor of the New Statesman.

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