1. Chart of the Day (above). Based on preliminary data for performance in December for hedge funds in the Barclay database, the S&P 500 Index out-performed the return on the average hedge fund last year by 1.36% to 0.42% (subject to further minor revisions). That marked the 7th straight year, and the 10th year out of the last 13 years, that the return on the S&P 500 was greater than the return on the average hedge fund.
2. Markets in Everything: The Nation’s First-Ever Vegan ‘Butcher Shop’ Is Opening In Minneapolis.
3. Good Question from Don Boudreaux: How About Minimum-Handout Legislation? Under such legislation, a person can give a beggar nothing, but everyone who chooses to give more than $0 to a beggar must give that beggar a minimum of $10.10 or risk being fined or caged by government. Read more here.
4. Economic Death Wish. In the LA Daily News, I argue that “Before raising its minimum wage for hotel workers above $15 an hour, Santa Monica should learn from LA’s mistakes.”
5. Creative Destruction. More Than 100 Restaurants Closed in D.C. in 2015. Maybe some of the DC restaurant closings were related to the 27% increase in the city’s minimum wage from $8.25 an hour in early 2014 to $10.50 an hour on July 1 last year. Maybe not. But the fact that more than 100 DC restaurants closed last year is evidence that the food industry hyper-competitive (“cutthroat”), operates on very thin margins (e.g. 2-5%), is subject to ever-changing and whimsical consumer demand, and extremely vulnerable to rising operating costs for food, rent and labor. Under the best and most favorable conditions it’s hard to survive and be profitable in the restaurant business. So how could an increase in labor costs by nearly 40% in DC (once the minimum wage increases to $11.50 this July) not have a devastating effect on restaurants, resulting in restaurant closings and job losses?
6. Freakonomics Radio Podcast. The True Story of the Gender Pay Gap, with Stephen Dubner and Harvard economist Claudia Goldin, here’s a quote from Dubner:
Women aren’t getting paid twenty-some percent less than men for doing the same work. They are, however, often doing different work, or work that affords more flexibility — which tends to pay less. Now, it may be that if you put a dollar value on the flexibility, it could offset a lot of the actual, salary dollars. In any case, there would seem to be kinda-sorta good news here, which is that discrimination doesn’t seem to be the main culprit in the gender pay gap.
7. Venn Diagram of the Day (above). If capitalists are so greedy would they really pass up an opportunity to save 23% on their labor costs?
8. Quotation of the Day, is from Thomas Sowell’s recent column:
As for facts and statistics, the only ones likely to be mentioned by gun control zealots, including the media, are those on how many people were killed by guns. How many lives were saved by guns will never make it through the ideological filters of the media, the political establishment or our educational institutions.
9. Who’d a-Thunk It? Another costly light rail system that is failing? The $665 million Edmonton light rail trains snarl traffic, slow down transit times and increase emissions, according to Tristin Hopper writing in the Edmonton Journal:
It’s slower than a bus. It has slowed down the buses that existed. And it is almost certainly increasing Edmonton’s net amount of carbon emissions. In short, it fails on every single possible justification for why cities should build light rail.
HT: Bill Riley
10. Demon Ethanol: a) “The Corn-Fed Albatross Called Ethanol” (WSJ) — “The renewable fuel has cost drivers an extra $83 billion to fill their tanks since 2007, and it does little or no good for the climate.” and b) “Ethanol Mandate Should Be Killed Now, Not In 2022” (IBD).
We’re not against motorists putting corn in their gas tanks if they want to. But what other product has a federal requirement forcing consumers to buy their product? If biofuels are the consumer bargain that Big Corn says, why not let them choose it on their own? If it’s good for the environment and reduces carbon emissions, then certainly “green” voters will demand it. The problem for ethanol producers now is that oil prices are so low at $35 a barrel — a third of where they were a year and a half ago — that ethanol isn’t economical.
from AEI » Latest Content http://ift.tt/1n9bhOw
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