Crazy Markets

In my post titled “Money Tree,” I explained in a general way how the addition of “non-market money[1]” distorts market prices, which in turn leads to a misallocation of resources. In this post, I will build a hypothetical model to show how that process works in more specific conditions. I will follow two different market … Continue reading Crazy Markets

Developing the Money Tree

As an experiment I have posted (below) a video version of the diagram I used to develop the Money Tree Post. If this experiment works, I might use videos such as this (only a little slicker) to enhance the explanation of additional points related to free markets. https://videopress.com/v/9l7qqCXZ?preloadContent=metadata Let me know what you think of … Continue reading Developing the Money Tree

The Money Tree

We have seen a lot of craziness in the financial markets recently. A small group of investors, known as the Reddit investors, bid up several low-priced stock prices, squeezing short-sellers. Many people have applauded this activity depicting it as the small guy outsmarting the big guy — in this case, hedge funds. But, there is … Continue reading The Money Tree

Response to Coronavirus

The coronavirus has not caused lost jobs, closed businesses, restricted air travel, and many other adverse economic effects. Responses to the coronavirus have caused these effects. Were those responses appropriate? We may never know. Responses due to market intervention have been substantially different than they would have occurred in a free market. Introduction To properly … Continue reading Response to Coronavirus

The Real Tax Burden

Socialists have one big weapon they want to use to correct many of the economic ills that they see. They want to use taxes as a way to redistribute money from billionaires to those they see as needier. If you see significant inequities in the distribution of income, that seems like a reasonable approach to … Continue reading The Real Tax Burden

Socialist Billionaires

Yesterday I argued that, in a free-market, entrepreneurs become billionaires by giving three groups of people what they prefer over what they have to give up. 1) Investors get an ownership share in a successful enterprise, 2) Suppliers get money for the plant, equipment, and labor they provide, and 3) Consumers get goods and services … Continue reading Socialist Billionaires

Free-Market Billionaires

Bashing billionaires seems to have become quite popular these days. Most of the current Democrat candidates attack billionaires in one way of the other. Led by Bernie Sanders and followed by the rest of the candidates, including the two billionaires, they all want to tax billionaires in order to support their favorite causes. According to … Continue reading Free-Market Billionaires

Wage Slavery Part 2: Worker Control

I continue my comments about “wage slavery” by addressing a common complaint from socialists about working conditions. The advocates of socialism claim that workers should have more control over their work environment and also have some ownership in the businesses for which they work. They include the desire to receive some of the “excess value” … Continue reading Wage Slavery Part 2: Worker Control

Wage Slavery

Advocates of socialism frequently claim that employers hold workers in wage slavery. They believe that “corporate” bosses force them to work in unbearable conditions at jobs they cannot quit. Adding insult to injury, the “bosses” profit from the excess value created by the workers. This form of wage slavery only occurs under “capitalism” as practiced … Continue reading Wage Slavery

Liberty or Literacy

During a recent town hall sponsored by CNN, Presidential candidate Bernie Sanders made the following statements and asked the following questions: “We’re very opposed to the authoritarian nature of Cuba,” Sanders said, “but you know, it’s unfair to simply say everything is bad. When Fidel Castro came into office, you know what he did? He … Continue reading Liberty or Literacy