The Doctor-Laborer Inversion

Originally posted on Keith Weiner Economics:

The battle over minimum wage is raging. Emotions are running hot. Some cities are setting the bar very high. For example, Seattle is mandating a $15/hour wage.

Economically, the issue is very simple. Minimum wage laws do not raise anyone’s wage. This is because it’s not sustainable to overpay.

Suppose you run a small tailor shop. Customers are willing to pay $20 to repair a pair of slacks. Why are they willing to pay that, and no more? It’s not just their budget, but also the relative value of fixing their old trousers compared to buying new. A higher wage for your employees will have no effect on customer willingness to pay.

You have rent, utilities, insurance, wear and tear on your sewing machines, etc. that add up to $10. Therefore your maximum gross profit is $10. You cannot pay someone $11, much less $15, to do this work. If the law…

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Jamie Dimon Has Issues (or Meet The Idiot Selling Gold)

Originally posted on Across the Street:

Jamie Dimon

Update: On Friday April 26, JPM customers (US government??) added a whopping 558 contracts (55,800 troy oz.) to the totals reflected in this article.  The CME group daily report can be found here, but note, these daily reports go into Never-neverland when the new one comes out (so save it if you want it for future reference).

Somebody should explain to the blathering numbskulls at CNBS that when just one firm accounts for 99.3% of the physical gold sales at the COMEX in the last three months it’s not what most of us on this side of the rainbow would consider “broad-based” selling.  Of course discovering this kind of relevant information requires an internet connection, 2nd grade math and reading skills, and the desire to do a teeny-weeny bit of reporting.  Sadly they’ve wandered so far down the rabbit hole that the concept of “physical demand” (i.e. people actually…

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PBS Defies Basic Journalistic Standards to Push Sandy Hook Official Narrative

PBS Defies Basic Journalistic Standards to Push Sandy Hook Official Narrative.

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Originally posted on azizonomics:

Opponents of the minimum wage tend to focus their attacks on the idea that it causes unemployment by forcing employers to discriminate against employees whose working abilities justify a wage less than the legal minimum:

Whether or not increases in the minimum wage (or minimum wage laws more generally) actually increase unemployment is a hotly-debated subject. Krueger and Card (1992) found that to not be the case; more recent meta-analyses of the academic literature such as Neumark and Wascher (2006) have found it to be true, but only to a small extent.

I want to come at this from a different angle. My intuition is that the minimum wage — even if it does not lead to decreased employment — is not an effective means to a fair wage level. This is because it is a price control set by the government, and as Hayek and Kirzner noted, the…

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NYPD Asks Nicely for Judge to Dismiss; Judge Tells City to File a Real Motion

NYPD Asks Nicely for Judge to Dismiss; Judge Tells City to File a Real Motion.

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An Open Letter In Support of Dr. Tracy and Academic Freedom

An Open Letter In Support of Dr. Tracy and Academic Freedom.

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