Venson:
 
I believe high end merchandise sold through big box retailers will be hardest hit by the Supreme Court ruling.  The low to middle range priced items are just fine.  Why?  Makers of everyday consumer goods could find it very diffcult to flex their new pricing muscle with powerful retailers like Wal*Mart or Target for fear of losing business.  Just as Wal*Mart bargains hard for what it pays for merchandise, it will be able to bargain with manufacturers to keep its discounts.  
 
If the minimum "floor" amounts on the expensive brands don't get buyers to buy their products (which is the case in point before the Supreme Court--expensive brand name women's leather goods) and sales stall, what do retailers do to sell?  Traditionally, retailers lower prices and increase profits through volume sales.  
 
If the retailers can't lower the prices below the minimum floor amounts, even in times when the sales of high-end goods are lackluster and inventories are building up and unsold, what options do the retailers have?  Discontinue the high-end merchandise and/or sell competitors' items which are less expensive.  What does this do for brand makers of the high-end merchandise that doesn't sell?  It forces these brand makers to lower the minimum "floor" amounts with retailers if they want to compete with the other brands.  A good thing for consumers.  [Economics and Macroeconomics 101: Supply, demand and price theory.]
 
Ironically, the ruling came the same day that the Commerce Department reported much lower durable goods spending (capital spending for big ticket items that last 7-10 years) for May 2007 and the 2nd quarter.  No doubt a result in part of the subprime mortgage lending debacle and the housing market decline.
 
Judge Breyer is a brilliant Justice and often has sided with business interests.  But he dissented along with Justices Stevens, Souter, and Ginsburg.   I think they got this one wrong even though I hate to go along with the conservatives on the court.  
 
If the retail prices do go up in the short term [as Justice Breyer predicts they will], it will be very short-lived.  Why? Market equilibrium prevails in the long run especially for prices of autos, electronics, books, toiletries and towels.  Buyers and sellers are the ultimate determination of reasonable market prices for goods [and sevices].  You have to have a willing buyer and a willing seller.  And the way it's done is through competitive pricing.
 
Carmine D.
 
  

The August 2007 Consumer Reports features an article on eBay scams, do's and don't hints, and a couple of Web Sites to report unethical eBay practices.
 
Carmine D.