Plain Sense Economics

Early in our Principles of Economics courses we introduce the simple, competitive market, which has many buyers, many sellers, no barriers to entry, reasonably full information, and no government intervention. We also explain how Adam Smith, in his book Wealth of Nations, preferred the market’s ability to establish a new equilibrium as if guided by [...]

From the New York Times, May 1, 2008
After the terrorist attacks of 2001 deflated the economy, Mr. Lauder [Chm of the Estée Lauder Companies] noticed that his company was selling more lipstick than usual. He hypothesized that lipstick purchases are a way to gauge the economy. When it’s shaky, he said, sales increase as women [...]

The Federal (Reserve) Open Market Committee (FOMC) announced last week that it was lowering its main interest rate target, the Fed Funds Rate, by one quarter of a percent. You can read the statement they released here.
Part of their statement and deliberations include concern about inflationary pressures. So they have to balance the need to [...]

A “devoted reader” (nepotism alert here – he’s my son…) asked for a plain sense review of the gas tax holiday supported by Senators Clinton and McCain.
First, let’s get a couple of quotes:
As reported in The New York Times:

Mrs. Clinton said at a rally on Monday morning in Graham, N.C., that she would introduce legislation [...]