I'm not economics expert, so can someone help me out here?

Dumpy Dooby · 01-12-2007, 03:58 PM

If that graph is correct, then that means that 6% increase on a CD (or something else) is essentially ineffective because the value of the money is dropping faster (~10%) than future value is rising (usually ~5-8%). Everyone's retirement plan is basically being offset by inflation ... and we just expedited the inflation process by raising minimum wage. If my assumptions are correct, then that's some scary shit right there.

Is there something I'm missing here?

Thorgrim · 01-12-2007, 04:04 PM

yeah, a cheeseburger still costs a buck, not $1.10

Diesel66 · 01-12-2007, 04:06 PM

Originally Posted by Dumpy Dooby

Is there something I'm missing here?

inflation rate is 3% not 10%

Dumpy Dooby · 01-12-2007, 04:09 PM

Originally Posted by Diesel66

inflation rate is 3% not 10%

Annual inflation rate is ~5% according to Alan Greenspan (so yes, you're right if we're talking about ANNUAL rate; the graph above shows every two months). The graph indicates that the inflation rate has just recently gone over 10%. Is it a temporary thing?

ballz2wallz · 01-12-2007, 04:52 PM

Originally Posted by Thorgrim

yeah, a cheeseburger still costs a buck, not $1.10

Quote for brilliance.

Pro Street · 01-12-2007, 05:00 PM

raising minimum wage will bring about the apocylapse.

Diesel66 · 01-12-2007, 05:02 PM

Originally Posted by Dumpy Dooby

Annual inflation rate is ~5% according to Alan Greenspan (so yes, you're right if we're talking about ANNUAL rate; the graph above shows every two months). The graph indicates that the inflation rate has just recently gone over 10%. Is it a temporary thing?

no it doesnt. That graph has nothing to do with inflation.

And no the current rate is not at 5%. It is 3.4% for 2005

Dumpy Dooby · 01-13-2007, 07:30 AM

Originally Posted by Diesel66

no it doesnt. That graph has nothing to do with inflation.

And no the current rate is not at 5%. It is 3.4% for 2005

Then what is it that the graph is indicating?

kinggovernor · 01-13-2007, 12:35 PM

Originally Posted by Dumpy Dooby

Then what is it that the graph is indicating?

it is talking about the change in M3, which is the change in the money supply. Money supply - Wikipedia, the free encyclopedia

motivez · 01-13-2007, 01:16 PM

I made a thread with that very same graph not too long ago

Bernanke flooding economy with money v.M3 returns

kinggovernor · 01-13-2007, 02:37 PM

Originally Posted by Pro Street

raising minimum wage will bring about the apocylapse.

it will increase inflation

Pro Street · 01-13-2007, 02:44 PM

Originally Posted by kinggovernor

it will increase inflation

yes, because inflation skyrocketed in 1995.

nobody has yet to address the fact that inflation, median income, and cost of living has all gone up while the minimum wage has stayed the same.

kinggovernor · 01-13-2007, 03:04 PM

Originally Posted by Pro Street

yes, because inflation skyrocketed in 1995.

nobody has yet to address the fact that inflation, median income, and cost of living has all gone up while the minimum wage has stayed the same.

The last time the minimum wage was increased, restaurant menu prices increased 2.6 percent in 1997 compared with a 1.7 percent increase in the consumer price index. Inflation in the service sector, in which most minimum wage workers are employed, rose 2.8 percent in 1997—1.1 percent higher than the overall inflation rate

Who is Paid the Minimum Wage and Who Would be Affected by a $1.50 per Hour Increase

Somehow the cost of an increase in the min wage has to be paid for somewhere. That causes inflation.

JaJae · 01-13-2007, 03:36 PM

Originally Posted by Pro Street

yes, because inflation skyrocketed in 1995.

nobody has yet to address the fact that inflation, median income, and cost of living has all gone up while the minimum wage has stayed the same.

It didn't skyrocket, but it did affect it. NJ just raised the minimum wage. My business and a lot just like it raised our prices to compensate. You think the private sector is going to take a 25% hit in payroll (their largest controllable expense)... not gonna happen in a capitalistic world my friend.

6SpeedTA95 · 01-13-2007, 03:40 PM

Originally Posted by JaJae

It didn't skyrocket, but it did affect it. NJ just raised the minimum wage. My business and a lot just like it raised our prices to compensate. You think the private sector is going to take a 25% hit in payroll (their largest controllable expense)... not gonna happen in a capitalistic world my friend.

Ummm sorry man but your logic is flawed, there wont be a 25% hit to payroll. Only about 3% of wage earners make min wage or less. It will not be a 25% hit to payroll not even close. Most folks dont make minimum wage, there will undoubtedly be payroll costs associated with a rising min wage, because all those folks making 7.25 hr will expect some sort of raise if they're a stocker and joeblow floor sweeper now makes what they do.

I'm against min wage, I'm against raising it, you make a valid point but its not going to cost companies 25% on their payroll.

JaJae · 01-13-2007, 04:04 PM

Originally Posted by 6SpeedTA95

Ummm sorry man but your logic is flawed, there wont be a 25% hit to payroll. Only about 3% of wage earners make min wage or less. It will not be a 25% hit to payroll not even close. Most folks dont make minimum wage, there will undoubtedly be payroll costs associated with a rising min wage, because all those folks making 7.25 hr will expect some sort of raise if they're a stocker and joeblow floor sweeper now makes what they do.

I'm against min wage, I'm against raising it, you make a valid point but its not going to cost companies 25% on their payroll.

I didn't mean 25% overall. But NJ raised minimum wage from 5.15 an hour to 7.15 an hour. That hit my business and a lot of other places like grocery stores for a rather large increase (25% or so) in payroll. A lot of minimum wage jobs hire rather large amounts of employees at min wage and have very few higher level positions which receive more. Our payroll increased rather abruptly with the new laws.

WickedLou9 · 01-13-2007, 04:24 PM

A change in the minimum wage will not effect inflation in the slightest. Some of the most populous states already have min wages higher than the federal minimum. So the increase won't effect them at all. The remaining people probably make up less than 1% of the remaining workforce and it would be mostly teenagers working summer and afterschool jobs. IMO, it's a non issue. People making min wage ,by and large, aren't trying to support a family, they are kids trying to earn extra spending money. It won't change anything one way or another.

WickedLou9 · 01-13-2007, 04:26 PM

Originally Posted by JaJae

I didn't mean 25% overall. But NJ raised minimum wage from 5.15 an hour to 7.15 an hour. That hit my business and a lot of other places like grocery stores for a rather large increase (25% or so) in payroll. A lot of minimum wage jobs hire rather large amounts of employees at min wage and have very few higher level positions which receive more. Our payroll increased rather abruptly with the new laws.

I don't really buy that. It would be a 25% increase of those workers earning min wage. That doesn't include management or anyone else working there that earns a salary or significantly over min wage. You are probably looking at an overall increase in operating costs of less than 1% for the entire store.

ballz2wallz · 01-13-2007, 04:28 PM

Originally Posted by WickedLou9

Some of the most populous states already have min wages higher than the federal minimum. So the increase won't effect them at all.

And what, pray tell, is the cost of living in those states? Please, I'd love to hear your analysis. Also, what are taxes in those states?

WickedLou9 · 01-13-2007, 04:52 PM

Originally Posted by ballz2wallz

And what, pray tell, is the cost of living in those states? Please, I'd love to hear your analysis. Also, what are taxes in those states?

what does that have to do with anything? aren't we talking about the effect of the min wage increase?