Latest Posts





The economy will recover after production has recovered

In order for the economy to recover, it will require demand and Supply boosts. The current unemployment incentives may encourage high unemployment thereby lead to a sluggish change in production. Prolonged unemployment will also inadvertently affects long-run demand. Recovery will require putting incentives for people to go back to work, letting businesses reopen and expand, so that economy gets back to producing in full capacity. Agreeably this will take a while, but it is the only way to ensure a sustainable path to growth; one that will not need constant propping up or never-ending stimulus. ...

Continue reading

High unemployment is what the economy ends up with when unemployment pays more than going to work

While there is a need to cushion workers from financial loss that comes with unemployment, there is a risk that come with giving people money while they stay at home; they will not have much need to earn money by working. This risk is there whether there is a pandemic or not. But that risk was magnified when the employment payouts were especially increased by a large margin. And this might become a problem for small businesses who cannot afford to pay their workers more. ...

Continue reading

Uncertainty regarding the shutdown is what is more threatening to businesses and the economy

When the Coronavirus started the first thing that happened was the closure of service businesses. In Minnesota Governor Walz ordered the closure of dining places and bars to close on March 16th.  This extended to a stay at home order for non essential businesses that was set to expire early April, but was extended till May 4th. Governor Tim Walz has amended the current stay at home order to allow for some businesses to return to work. Specifically those businesses requiring least contact with consumers, as long as workplaces can maintain distancing as well as disinfecting procedures. For the rest of...

Continue reading

Why small businesses tend to get the short end of the stick of any economic downturn

Whether in a recession or any activity increasing the cost of business, small businesses tend to suffer the worst of it.In the current pandemic the trend is the same; small businesses, especially service establishments, have experienced more job and business losses. A big proportion of small business have gone completely out of business and will not be opening back once the shutdown is over. A current research paper by NBER after conducting a survey on more than 5,800 small businesses found the following: First, mass layoffs and closures have already occurred. In our sample, 43 percent of businesses are temporarily closed, and...

Continue reading

Thomas Sowell on the Welfare state

Thomas Sowell is an American economist and social theorist currently a senior Fellow at the Hoover Institution. He has been one of modern day`s big advocates against the social welfare state or its expansion thereof . He has spoken and written extensively on the unfounded presence of the welfare state, that keeps on expanding. I share some of his quotes that do sum up the illogical nature of the welfare state: The assumption that spending more of taxpayer’s money will make things better has survived all kinds of evidence that it has made things worse. I have never understood why it is...

Continue reading

Costly Surcharges on the Menu as Diners Pay for Restaurant Regulations

Diners may find more offerings on the menu at an increasing number of Twin Cities restaurants these days but not necessarily the usual gourmet fare. In addition to entrees, drinks and desserts, the tab now often includes a health care or other surcharge as restaurants seek to recover higher costs due to minimum wage hikes, paid time off and other costly new local government regulations. The trend remained largely under the radar until a diner surprised by a three percent surcharge tacked onto the cost of his meal filed a law suit, according to the Star Tribune. Christopher Ashbach, 40, of Arden...

Continue reading