Posts Tagged ‘Unemployment’

The Minimum Wage

Posted: February 26, 2014 in economics
Tags: ,

There are so many things we grow up learning in school, from our parents, from our friends that we just assume are true. We don’t even think twice about them. They are as good as gravity. One of the reasons I just can’t read enough or watch enough videos or listen to enough podcasts about this stuff is that my mind is constantly being blown. It’s like learning everything for the first time, or maybe more like unlearning so many things you thought were factual. The first time I heard the minimum wage was not good or necessary, I was a little blown away. “Of course the minimum wage is necessary,” I thought. “Otherwise employers would just pay their employees peanuts.”

I now know this is just a ridiculous notion. It comes down to basic economics: supply and demand. If you increase the cost of something people will buy less of it. Price goes up, demand goes down. This is a law, like gravity. Not debatable. The rules don’t change just because the price we’re talking about is labor. Any study claiming the contrary is nonsense. Any such study is saying gravity does not exist and that the earth is flat. (more…)

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zerohedge article

Here is a great article on zerohedge.com explaining why our unemployment rate is dropping despite a moribund economy. Another great example of the Fed’s easy money policy distorting the real state of things. This is a must read. It’s short and mad informative.