2007 Redux Part 2

[guncrasher]

Setting minimum wages higher than market rates results in some higher prices.  But that's not the main problem.  The main problem is that it puts a bunch of people out of work.  The employer doesn't hire a person whose wage is higher than what the work is worth.  In economic terms, you set the price of the labor too high, and now you have a surplus of it (i.e., people who want work who now can't get it).

Setting salary caps are bad in the opposite way.  The worker doesn't take a job that pays less than what the work is worth.  In economic terms, you set the price of labor too low, and now you have a scarcity of it (i.e., employers who want to hire but can't get people to do it).

The more you deviate from how a free market sets prices, the worse the consequences.  Deviate a lot, and you get how markets work in Venezuela, Cuba, and the Soviet Union.

All of this stuff is well laid out in an excellent and short book:  Economics in One Lesson, by Hazlitt.  Or a longer one that is a more thorough:  Basic Economics, by Sowell.  These are marvelous books.  On my list of 10 best and most-useful books to read in one's life.

that reminds me of back in 98 when I was working as a temp at this company.  I was there to replace a lady that was out for 6 weeks due to surgery.  the job was stupidly simple and easy.  I would do a day's work in 2 to 3 hours. so I would ask to help somebody else. then I would finish their work too.  so they stopped having me help.  so I asked to speak with the manager, told him I couldnt stick around making 15 or 20 bucks a day.  wont even pay for the gas. so they let me go, temp agency got mad and wouldnt give me any more work.  company went under like 4 years later.  too many lawsuits because they were a subcontracor to a couple of other companies that skimp on work to save a couple of hundred bucks per house.

I could have done the work of 3 or 4 people there in a day. not because I was smarter, I could just type faster.  I am not a workaholic, just I always followed my one rule, dont mess with my pay and I'll stick around.  other than a few weeks here and there only had 4 jobs in my life.

semp

[Brooke]

And because semp is awesome! 

[CptTrips]

Fed meeting minutes 15-Mar-2022:

[Eagler]

So will the next war start before the crash or after it?

I say after as it will be much easier to spin up the needed patriotism needed for such an engagement if the public is desperate as they see their bloated way of life going down the drain...

But after that stirring rambling speech yesterday from our fearless leader who is worried?

Anyone with more than half a brain should be!

Eagler

[TheBug]

As CptTrips was providing good info on the market,  I apologize for getting it closed

I will refrain from including that subject matter in this thread

Eagler

You're such a lying ahole.

[Eagler]

Shove it bug

I have not mentioned what locked the other thread

Eagler

[Eagler]

Today is a great example of what's wrong with the market...

Weekly jobless claims jump to 3 moth high and stocks are up across the board as they take this bad news as good to keep the feds fingers in the cookie jar..

When bad news actually moves the market lower consistently I will believe the fed is actually getting out

Eagler

[guncrasher]

lol what you call the market is actually stockbrokers who only make money if they get clients to buy or sell. you should watch the wolf of Wallstreet, that tells you pretty much everything you need to know.


semp

[TyFoo]

Today is a great example of what's wrong with the market...

Weekly jobless claims jump to 3 moth high and stocks are up across the board as they take this bad news as good to keep the feds fingers in the cookie jar..

When bad news actually moves the market lower consistently I will believe the fed is actually getting out

Eagler

"The sun will come out tomorrow. . . .  , So ya gotta hang on 'Tilllllll tomorrowwwwww, Come what mayyyyyy, Tomorrow! Tomorrow! I love ya Tomorrow!

You're always A day awayyyyyyyyyyyy!"

"Annie 1977"

[CptTrips]

Today is a great example of what's wrong with the market...

Weekly jobless claims jump to 3 moth high and stocks are up across the board as they take this bad news as good to keep the feds fingers in the cookie jar..

When bad news actually moves the market lower consistently I will believe the fed is actually getting out

Eagler

Not necessarily a cause and effect. 

There will always be variation and Bulls and Bears try and feel out the equilibrium point like a blind man with a cane.  Also, things never happen in a straight lines.  After the last couple of down days there always be a temporary retracement to tidy up any over-extensions. 

It may mean nothing more than that.  That's why I don't care about day-to-day granularity fluctuations.  I'm not a day-trader.  I think in terms of quarters and years. Except for extraordinary events like war or days of rate hikes.

[Eagler]

Just early market manipulation as it closed over 300 points down

As they were up 300 earlier that's a 600 point swing over no real new news...manipulated

Eagler

[CptTrips]

And the Fed hasn't even done anything yet. 

Tapering is not tightening in my book.  You are easing on the accelerator pressure, but you are still accelerating.
Mar 15 is the first time they will start actual tightening.  Everything happening now is just foreplay. 

Reading various investor comment sections, it's amazing how many people still don't believe the Fed will tighten. 

Denial ain't just a river in Egypt. 

[Brooke]

lol what you call the market is actually stockbrokers

Stock brokers are just about always only a minor influence on the market because they are only one small piece of it.  Since 2008, government and Fed action have been the main influences.

[guncrasher]

Stock brokers are just about always only a minor influence on the market because they are only one small piece of it.  Since 2008, government and Fed action have been the main influences.

how do you think wall street makes money?

all the firms depend on selling or buying. that's how they get bonuses.


semp

[Brooke]

how do you think wall street makes money?

all the firms depend on selling or buying. that's how they get bonuses.


semp

It's like car salesmen.  Car salesmen might skew the price cars here and there, but the general prices of cars and trucks are determined by factors much larger than the effect of car salesmen.

The financial market overall is stocks, bonds, debt, and derivatives altogether.

It is about a quadrillion dollars worth of stuff.

Issued by, bought buy, traded by, and facilitated by an enormous complex system.  Stock brokers are one tiny part.  Even for the tiny fraction of transactions stock brokers are involved in, their clients are influenced by more than just the broker (who is like a salesman):  client's internal thoughts, world conditions, market trends, news, etc.

Its a big collective, complex system like the weather.

The Federal government can exert major influence.  Entities with enough influence to get the Federal government to do things can exert major influence.  Enough entities all doing the same thing like a school of fish (like all stupidly buying crappy mortgage-backed securities pre 2008) can exert major influence.  That's not stock brokers.

Yet even all of that might not be able to skew the market forever.  Eventually, things get priced by the gigantic, complex collective system overall.