Welcome to CrushTheStreet.com’s Weekly Market Wrapup!
Our top story of the week comes from Politico Magazine, which recently reported that the Seattle City Council unanimously passed an ordinance Monday that will gradually increase the city’s minimum wage to $15, which would make it the highest in the nation. Known for its liberal base, Seattle mayor Ed Murray ran on a campaign promise to raise the minimum wage to the lofty target, with city councilmember Tom Rasmussen stating, quote, “Seattle wants to stop the race to the bottom in wages.” He further went on to say that the wage increase would address the widening gap between rich and poor.
Although the ordinance, which is set to take effect on April 1, 2015, was met with boisterous approval amongst the labor activists that packed the Council chambers ahead of the vote, it also has raised serious concerns, perhaps most notably from the International Franchise Association, which labeled the City Council’s action as unfair and discriminatory. Local restaurant owners have voiced their opposition as well, stating that such a dramatic increase in the minimum wage would scuttle expansion plans, decrease hiring, and force cutbacks in service hours.
Controversy Deflects Attention from Real Problem
Whatever side of the issue you are on, the controversy deflects attention away from the real problem : central bank mismanagement of monetary supply. As it stands, Seattle’s minimum wage has increased over 700% since June of 1961 ; however, when set against real dollar value, the threshold has only increased by a mere 5.3%. According to data provided by the Bureau of Labor Statistics, Seattle’s real minimum wage averaged $9.33 between 1961 and 1976, a penny higher than what it is today.
The uproar from business groups opposing any further increases to the minimum wage and the actual laborers that receive them ignores the crucial context that in both cases, the government has single-handedly destroyed the incentive for capital savings and the free market infrastructure by pitting social classes against one another in an effort to hide what essentially amounts to legalized counterfeiting. In order for families to survive in an eco-system of rising costs and declining employment opportunities, the minimum wage would realistically have to jump to $30 dollars across the board to compensate.
Precious Metals
For the metals complex, both gold and silver gained some stability after suffering a large drop two weeks ago. Gold bounced back above the 1,250 mark after dovish remarks from ECB president Mario Draghi, while silver had the biggest move, shooting past the $19 dollar level. Palladium had a slow but positive week, adding two dollars to the ask. On the digital front, bitcoin is quietly making a resurgence in an attempt to shadow last year’s parabolic highs, settling at $650 dollars at last count.
And that will do it for this edition. Thanks for watching and we’ll see you next week!