Tuesday, July 31, 2007

All Time High for Oil?

According to the media,

Oil near all-time high over $77

However, to make meaningful comparisons across time you must use real dollars, not nominal dollars.

So, while oil is high; it is no where near an all-time high.

Capital Gains: Cut Rates and Increase Revenue

A Workable Tax Reform Compromise?

from the Skeptical Optimist

Sunday, July 29, 2007

Remember, Investing is About the Long Term

Despite a bad week, the past 52 weeks is looking good.

Dow has Worst Week in Over 4 Years

After breaking 14,000, the Dow experienced 3 of its worst days this year in the same week.

Wednesday, July 25, 2007

Minimum Wage Too High in Northern Ireland?

Prime Minister Gordon Brown is considering plans which could see the minimum wage reduced in Northern Ireland...

read the story

Could the minimum wage actually cause an increase in unemployment?

How Many Earn Minimum Wage?

another great chart from the Skeptical Optimist

People tend to forget minimum wage jobs are a starting point, not a career goal.

Tuesday, July 24, 2007

Dead Farmers Got Subsidies

The Agriculture Department sent $1.1 billion in farm payments to more than 170,000 dead people over a seven-year period, congressional investigators say.

source: Seattle Times

Raise your hand if you are surprised.

Monday, July 23, 2007

Markets in Everything: Snow Skiing in Dubai

It is summer, it is over 100 degrees outside. Let's go snow skiing.

New Minimum Wage: $5.85

So will unemployment among the low to no skill jobs increase or decrease?

But at the same time, employers who pay many of these low-wage workers say increasing the minimum wage only means they have to raise the prices of the products, cut back on employees’ hours or let some workers go.

“When you go into the grocery story now, you may be checking your own groceries, you may be bagging your own groceries,” said Jill Jenkins, chief economist for the Employment Policies Institute. “All of these things are because of mandated wage hikes. When you have to pay more, employers begin to find other options to keep costs down.”

According to the National Restaurant Association, the last minimum wage increase cost the restaurant industry more than 146,000 jobs and restaurant owners put off plans to hire an additional 106,000 employees.

At $7.25 an hour, the most likely response from restaurants will be “increases in menu prices, elimination of some positions and reduction of staff hours to try and offset some of the increased labor costs,” said Brendan Flanagan, the association’s vice president of federal relations.

read the entire article

The Problem of Forecasting

"the causes of the change from a ten-year surplus of $5.6 trillion to a ten-year deficit of $2.9 trillion--a swing of $8.5 trillion. The biggest factor was increased spending, of which increased defense spending was the largest piece. The second biggest factor was changed economic and technical assumptions (that is, the forecasters were wrong)." Greg Mankiw

Oooops. Only off by $8,500,000,000,000.

Wednesday, July 18, 2007

Recommended Reading: Walter Williams' column

the latest column from Walter Williams

Economists on the Loose

"Free markets are simply millions upon millions of individual decision-makers, engaged in peaceable, voluntary exchange pursuing what they see in their best interests. People who denounce the free market and voluntary exchange, and are for control and coercion, believe they have more intelligence and superior wisdom to the masses. What's more, they believe they've been ordained to forcibly impose that wisdom on the rest of us. Of course, they have what they consider good reasons for doing so, but every tyrant that has ever existed has had what he believed were good reasons for restricting the liberty of others."

read the entire column

Thursday, July 12, 2007

The Budget Deficit is Shrinking

Dow Jones: All-Time High 13,861.73

What, exactly, is the Dow Jones Industrial Average?

The DJIA is an index of 30 "blue-chip" U.S. stocks. At 100-plus years, it is the oldest continuing U.S. market index. It is called an "average" because it originally was computed by adding up stock prices and dividing by the number of stocks. (The very first average price of industrial stocks, on May 26, 1896, was 40.94.) The methodology remains the same today, but the divisor has been changed to preserve historical continuity. The DJIA is the best-known market indicator in the world, partly because it is old enough that many generations of investors have become accustomed to quoting it, and partly because the U.S. stock market is the globe's biggest.

other FAQs about the Dow Jones Industrial Average

Worldwide Economic Boom

The Greatest Economic Boom Ever?

full article

Supply and Demand: New York City Parking

"Spaces are in such demand that there are waiting lists of buyers. Eight people are hoping for the chance to buy one of five private parking spaces for $225,000 in the basement of 246 West 17th Street, a 34-unit condo development scheduled for completion next January....

Although spaces in prime sections of Manhattan are the most expensive, even those in open lots and in garages in Brooklyn, Queens, Riverdale and Harlem are close to $50,000, although at least one new Brooklyn development is asking $125,000...

According to Miller Samuel, the average parking space costs $165,019, or $1,100 per square foot, close to the average apartment price of $1,107 per square foot."

entire article

US v. Japanese Carmakers Compensation

Does this mean professors are "underpaid"?

Wednesday, July 11, 2007

The Result of Socialism and Central Planning

Robert Mugabe "who famously despises “bookish economics”, has decided to outlaw inflation. Price freezes have only been enforced through the arrest of scores of businessmen who are accused of profiteering. The result: shops are bare of basic goods, as businesses refuse to sell more than a minimum of flour, sugar, maize and other items at a crippling loss. There has been panic buying all over the country. In Harare, the capital, crowds wait outside supermarkets ready to rush in and grab whatever they can. Where basics such as cooking oil are available they are rationed by shopkeepers. Fuel is in short supply, with long queues of cars reappearing outside Harare’s petrol stations. As factories prepare to close operations their owners, in turn, are being arrested and forced to keep operating."

Desperate Times in Zimbabwe

Friday, July 6, 2007

Recommended Reading: Walter Williams' Column

the latest column from Walter Williams

Do People Care?

"If Professor Alchian's vision of how the world works is correct, what are its implications? A major implication is that one's destiny, for the most part, is in his hands. In other words, how you make it in this world, for the most part, depends more on what you do as opposed to whether people like or dislike you. In order to produce a successful life, one must find ways to please his fellow man. That is, find out what goods and services his fellow man values, and is willing to pay for, and then acquire the necessary skills and education to provide it. Whether your fellow man cares about you or not is largely irrelevant."

click here for entire column

Thursday, July 5, 2007

Cost of Gas Around the World

Cost to fill a Honda Civic
Gas per Gallon
Gas Consumption
Pain at the Pump

Cost of Government Day

Cost of Government Day - n. the date of the calendar year, counting from January 1, on which the average American has earned enough in cumulative gross income to pay for his or her share of government spending (total federal, state, and local) plus the cost of regulation.

Americans for Tax Reform

I don't know if I can live on my income or not - the government won't let me try it. ~Bob Thaves, "Frank & Ernest"

Wednesday, July 4, 2007

Happy Independence Day

When in the Course of human events it becomes necessary for one people to dissolve the political bands which have connected them with another and to assume among the powers of the earth, the separate and equal station to which the Laws of Nature and of Nature's God entitle them, a decent respect to the opinions of mankind requires that they should declare the causes which impel them to the separation.

We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness. — That to secure these rights, Governments are instituted among Men, deriving their just powers from the consent of the governed, — That whenever any Form of Government becomes destructive of these ends, it is the Right of the People to alter or to abolish it, and to institute new Government, laying its foundation on such principles and organizing its powers in such form, as to them shall seem most likely to effect their Safety and Happiness.

Prudence, indeed, will dictate that Governments long established should not be changed for light and transient causes; and accordingly all experience hath shewn that mankind are more disposed to suffer, while evils are sufferable than to right themselves by abolishing the forms to which they are accustomed. But when a long train of abuses and usurpations, pursuing invariably the same Object evinces a design to reduce them under absolute Despotism, it is their right, it is their duty, to throw off such Government, and to provide new Guards for their future security. — Such has been the patient sufferance of these Colonies; and such is now the necessity which constrains them to alter their former Systems of Government. The history of the present King of Great Britain is a history of repeated injuries and usurpations, all having in direct object the establishment of an absolute Tyranny over these States.

Thomas Jefferson, Declaration of Independence

Tuesday, July 3, 2007

Supply and Demand: Machetes

“The price of machetes has halved in parts of Nigeria since the end of general elections in April because demand from thugs sponsored by politicians has subsided, the state-owned News Agency of Nigeria reported.”…

”Machetes are primarily used as a tool for farming in Nigeria
but they are also popular among political gangsters.”…

”European election monitors estimated that at least 200 people were killed in politically motivated violence during months of campaigning ahead of the April polls."

Price of machetes drops in Nigeria after elections