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Income inequality and diminishing marginal utility

Income inequality and diminishing marginal utility

Calvin is referring to economic law of diminishing marginal utility.  In general, it states that consumption of preceding goods or services won’t deliver the same level of satisfaction relative to the first (or in Calvin’s case, the second).  As Calvin illustrates, his third or fourth bowl of chocolate frosted sugar bombs will make him sick.  … Continue reading

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  • From CNN: Moody's warns that "U.S. credit rating hinges on Congress." Money quote - "Currently the outlook assumes that Congress will increase it 'in a relatively orderly process.' But Moody's said it would put the U.S. rating under review during negotiations over the debt limit." I'll write more on this later.
  • A neuroscience team at Caltech, using fMRI imaging, found that our brains are wired to prefer equality. "The team found that the reward centers in the human brain respond more strongly when a poor person receives a financial reward than when a rich person does."
  • New Pew poll claims "many Americans believe the rich are different than other people." Some interesting findings: 1) "Nearly six-in-ten survey respondents (58%) say the rich pay too little in taxes, while 26% say they pay their fair share", and 2) "A much higher share of Republicans (55%) than Democrats (33%) say, compared with the average person, rich people are more likely to be hardworking."
  • From Reuters: "At 1,400, the S&P 500 on Friday was closing in on a four-year high and was up 74 percent since January 20, 2009, the day Obama took office. Not since Dwight Eisenhower's first term has a president had such a strong run for their first term."
  • Corporate profits are at all time highs while wages plummet to all time lows. Yet some still think that corporate profitability increases employment. It's time to realize that what's good for corporate America is not always good for Americans
"Practical men, who believe themselves to be quite exempt from any intellectual influences, are usually the slaves of some defunct economist. Madmen in authority, who hear voices in the air, are distilling their frenzy from some academic scribbler of a few years back. I am sure that the power of vested interests is vastly exaggerated compared with the gradual encroachment of ideas. [...] it is ideas, not vested interests, which are dangerous for good or evil." - John Maynard Keynes

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