Tuesday, December 31, 2013

The One, Two, Three Punch: How Youth Will Get Screwed in 2014

1. Increasing minimum wage laws in many cities and states will make more youth unemployable, as  the mandated minimum wage will be greater than the marginal revenue product of many youth.

2. Increasing regulations will continue to suffocate many 20-somethings from becoming entrepreneurs, as the costs to meet new regulations will be prohibitive.

3. Obamacare will increase the cost of healthcare insurance for the healthy youth well over what free market insurance would cost.

Avik Roy writes:
And make no mistake: on average, sicker and older people will fare far better under Obamacare than healthy people will. According to an analysis I conducted with colleagues at the Manhattan Institute, older, sicker individuals will benefit most from Obamacare’s exchange subsidies. On the other hand, in many parts of the country, healthier Americans—especially younger ones—will see their premiums double or triple under the law.



    My 2013 predictions were framed by these core elements. After re-reading my article for the first time in eleven months I’ve concluded it is lucky I don’t charge for investment predictions. Many of my prognostications were in the ballpark, but I have continually underestimated the ability of central bankers and their Wall Street co-conspirators to use the $2.8 billion per day of QE to artificially elevate the stock market to bubble level proportions once again. If I wasn’t such a trusting soul, I might conclude the .1% financial elite, who run this country, created QEternity to benefit themselves, their .1% corporate CEO accomplices and the corrupt government apparatchiks who shield their flagrant criminality from the righteous hand of justice.

    Even a highly educated Ivy League economist might grasp the fact that Ben Bernanke’s QEternity and ZIRP, sold to the unsuspecting masses as desperate measures during a crisis that could have brought the system down, have been kept in place for five years as a means to drive stock prices and home prices higher. The emergency was over by 2010, according to government reported data. The current monetary policy of the Federal Reserve would have been viewed as outrageous, reckless, and incomprehensible in 2007.

    It is truly a credit to the ruling elite and their media propaganda arm that they have been able to convince a majority of Americans their brazen felonious disregard for the wellbeing of the 99% is necessary to sustain the .1% way of life.

    Those palaces in the Hamptons aren’t going to pay for themselves without those $100 billion of annual bonuses.


  2. 1) many youth? How many? One or two? When the minimum wage is not adjusted for inflation the real minimum wage falls. If you believe Peter Shiff's inflation numbers (6%/year for the last decade) then the real minimum wage has been cut in half since 2004.
    2) What new regulations? Start a business sometime and you'll find out it is very easy and there are few regulations inhibiting entrepreneurs (unless you are serving food).
    3) Free market health insurance? So long as investors can limit their personal liability by incorporation, you are not in a free market. No sane person would sell health insurance (or any insurance) without limiting their personal liability via incorporation. This means it is impossible to have "free market health insurance."

    Furthermore, young people face no penalty of consequence for not having insurance. They simply do not earn enough taxable income. If they are healthy, it's unlikely they will purchase health insurance. Many will be able to stay on their parent's policies until they are 26. This means Obamacare is a net positive for young people. That's why they voted for Obama in large numbers in 2012.

    4) Gold closing the year under 1200 as predicted.

    1. Gold: Declining Prices Versus Skyrocketing Demand


    2. Inflation is about the only thing that allows the businesses to deal with minimum wage laws and return them to more acceptable levels for unskilled labor. Problem is the end result will go one of two ways. Less people get employed or cost of everything will go up to push the value of the unskilled laborer back to parity with it's value.

      In the case of the inflation scenario the problem will come because government wont keep pace on adjusting it's taxes and all these people who got a raise will be hit by Obamacare, Changing tax bracket and higher cost of goods. It only took roughly 20% of the New World people to revolt against the British to spark a revolution, and they revolted because of the tax burdon. We are well passed that now and once people start waking up change will come ballet or bullet. I pray it is by ballet.

    3. But gold is supposed to be the super-investment. It's supposed to go through the roof and show everyone that goldbugs and Libertarians were right all along.

    4. Oh look everybody, Gil the super-troll is here. Fuck off, Gil.

    5. Don't fault Gil for being shortsighted. He's a fish.

  3. Is it too much to think that eventually we would see Greece like protests coming from youth when youth unemployment skyrockets due to these hikes. For the record I'm 29

  4. America's youth will also be getting screwed by another million plus immigrants pouring across the border in 2014.
    Many of those million plus immigrants think a minimum wage job plus GOV benefits is just a peachy life.

    Unfortunately for America's youth many Libertarian/Austrian types march in lockstep with Democrats, Replublicans & Oligarchs on the immigration issue.

  5. It is not "eat the rich", It is 'eat our young'.