supply demand

The Case for Raising the Minimum Wage? Complicated. Setting a “Maximum Wage?” Simple

Risk of Unintended Consequences At least to economists, the question of whether the minimum wage should be increased — and by a lot, as many on the political left advocate — is tricky. In a perfect world, the higher the minimum wage — hell, all wages — the better:  higher pay = more disposable income...
Read More

Making Sense of Jumbo Mortgage Rates

From Steep Premium to Discount In the wake of the 2008 Financial Crash, rates on jumbo mortgages (over $417k in most parts of the country) skyrocketed to 7% or even higher. Assuming you could find one. Fast forward to Fall 2015, when jumbo’s can now be had for as little as 3.75% — a slight discount to...
Read More

The OTHER Use For Feb. 2015 Global Warming Map: The Case for (Finally) Capturing Economic “Externalities”

Second Home Selector, or “Hello, Palm Springs!” That’s not just a map (above) of how much February, 2015 global temperatures departed from global averages the last 30 years. If you live in Minnesota, it’s a 2nd home (or winter vacation) selector. So, if your principal residence is in a purple area experiencing temps -5º below...
Read More

What Comes After Record Airline Profits?

Sell High, Buy Low — & Look Out For Competitors Being an ardent free marketer at heart, I don’t think government should do anything — at least directly — about airfares that remain at nosebleed levels even as airlines’ fuel costs collapse and their profits soar. Instead, I think government should focus on steps to increase competition....
Read More

How the Housing Market Shifts Gears

From a Seller’s to a Buyer’s Market? The catalyst(s) and pace may vary, but the dynamics of a housing market shift — most recently from a Seller’s market to a (nascent) Buyer’s market — are unvarying. And that’s regardless of locale or calendar (i.e., it describes Las Vegas 2007 as well as Orange County in...
Read More

Xcel: ‘Slack Demand Signals Need for Rate Hike’

Supply, Demand, and the Price of Electricity “Xcel Energy reported a 17 percent jump in earnings per share for the third quarter, but warned that electricity sales remain slack, and that it will seek a Minnesota rate increase.” —Star Tribune (10/26/2012). OK, so it’s been 30(!) years since I studied economics in college. And I...
Read More