Economic stimulus package

[shade]

Not surprisingly, Bush has proposed we force everyone to take out an interest only loan in order to stimulate the economy.

However, they use different language. But it is what it is.

When you are already running a deficit, and then cut taxes further, you are just going to run a worse deficit. If everyone gets $800 or whatever they decide on, it literally means that everyone is being forced to take out an interest only loan of $800. The government rarely ever pays down principal on the national debt and only pays interest. So that means you are going to get an $800 interest only loan that you will have to pay for for the rest of your life.

Now, I think having a deficit during a recession is fine. The last thing you want to do is lay off a ton of government workers or contractors during a recession. However, when you run a deficit throughout the "good times" and then the economy takes a turn for the worse, it means you have to run an even bigger deficit to try to have a turn around.

Meanwhile this just continues to increase the amount of interest we have to pay on the debt moving forward. In 2006 we paid $406 billion of interest on the debt. That comes from your taxes. We raised about $1 trillion from income tax. That means 40% of your income tax simply goes to interest on the national debt. That is a similar cost as Medicare, to put this in perspective.

Our hands are tied at this point and we probably do need this sort of a stimulus package, but what we really need is to do what any responsible household would do. We need to make a road map to end this cycle of debt.

I think the stimulus package should include a plan to end the deficit once the recession is over. If we are ever so lucky as to get a surplus, it should not be pissed away. Instead it should go to pay down the debt or to buy government bonds from other nations and perhaps direct the proceeds of that to help fund our social security.

If you personally lost your job, would you cancel your cable, stop going to restaurants, etc, or would you decide to go buy a plasma tv on a credit card? That is what the country is doing.

[chalupa]

Well, I know that I'm going to take that $800 and invest it, and turn it into $1600 and then turn that into $3200, and keep going until I am independently wealthy and can take care of myself in my old age, just like everyone else will, not go out and get $800 worth of SHIT from FUCKING WALMART to stimulate the economy.

Good plan, GW, good plan. Hopefully the average American will understand this bullshit for what it is some day.

Probably not, though.

[shade]

I am going to put it in a savings account to go towards my local property tax at the end of the year.

You know the consumer is tapped if the government is willing to go into debt to keep people spending.

[Fungus Amungus]

Im buying a PS3. BWAHAHAHAHAHAHA








I keed.

[avix123]

Into the Roth.

[Poser Park]

I'm going to buy some survival supplies.

It's best to be prepared.

[KillaJezuz]

im no expert in economics but this sounds bad. but pleasing at the same time. are we going do the road that germany took when it printed all that money she didnt have? i dont know. and hey isnt a war supposed to stimulate our economy. or is this an occupation? my family could use $1600 but no at the expense of our future. sometimes i think our economy is flawed, anyway. we go to work just to entertain ourselves. outside of living needs: house, car, food, clothes, medical etc. we spend so much money (on credit) for pleasures. and we have done so for so long our economy has to have it. lol people are buying cyber real estate. $400 video games. but hey thats capitalism, aint it. but i do love it:dunce:

[shade]

im no expert in economics but this sounds bad. but pleasing at the same time. are we going do the road that germany took when it printed all that money she didnt have? i dont know. and hey isnt a war supposed to stimulate our economy. or is this an occupation? my family could use $1600 but no at the expense of our future. sometimes i think our economy is flawed, anyway. we go to work just to entertain ourselves. outside of living needs: house, car, food, clothes, medical etc. we spend so much money (on credit) for pleasures. and we have done so for so long our economy has to have it. lol people are buying cyber real estate. $400 video games. but hey thats capitalism, aint it. but i do love it:dunce:

There is a lot of wisdom in your first post. You are right in your observation that so much of what we do is basically just to do it. It is like humanity just has to be busy for them to feel like they have a purpose in life.

I often think we would be happier if we just lived on our own farms. Get your food, and hang out.

I wonder what the world would be like if the only trees that grew were fruit bearing and if all we had to do was build shelter for ourselves and then go outside to pick our food.

[clutch-monkey]

I wonder what the world would be like if the only trees that grew were fruit bearing and if all we had to do was build shelter for ourselves and then go outside to pick our food.

it'd be fine until we decided that those trees over there, being picked by those other people, were more desirable than the ones we presently had...

[chalupa]

There is a lot of wisdom in your first post. You are right in your observation that so much of what we do is basically just to do it. It is like humanity just has to be busy for them to feel like they have a purpose in life.

I often think we would be happier if we just lived on our own farms. Get your food, and hang out.

I wonder what the world would be like if the only trees that grew were fruit bearing and if all we had to do was build shelter for ourselves and then go outside to pick our food.

we could all live on the shire.

capitalism has a fatal flaw, but that flaw is tempered by political participation. unfortunately, 50 percent vote? maybe?

people need to understand that the power to change things is n numbers, not $.

the $ will rule, but the people will have to be placated.

[shade]

The people are placated.

[Pajman]

Just as a side note: the stimulus is going to have an effect regardless of what you do with the money; the only way your money can stay idle is if you keep it as cash. The government's aim isn't for the people to go out and make conspicuous or unnecessary consumption (although that's going to happen anyway).

[American Infidel]

Gold just reached a record $900 per ounce. I'm wondering where Ron Paul would find the money to rebuild Fort Knox, in order to reinstate the gold standard.

[dead]

Just as a side note: the stimulus is going to have an effect regardless of what you do with the money; the only way your money can stay idle is if you keep it as cash. The government's aim isn't for the people to go out and make conspicuous or unnecessary consumption (although that's going to happen anyway).
LOL American consumers will do what American consumers are best in spent it on junk and the stimulus is mend that way. ;)
The houses of those spending recklessly during the housing boom are already secured.
http://business.theage.com.au/bush-to-freeze-interest-rates-for-subprime-victims/20071206-1fg5.html
And yes the stimulus will have a effect a temporary relief followed by a big depression.
The reason why this stimulus is provided is not because this is a minor recession but something much bigger.

[Pajman]

I don't see a big depression coming...

[Henkie]

Gold just reached a record $900 per ounce. I'm wondering where Ron Paul would find the money to rebuild Fort Knox, in order to reinstate the gold standard.

He could print more dollars to buy all the gold? :rolleyes:

[IrishNed]

Just as a side note: the stimulus is going to have an effect regardless of what you do with the money; the only way your money can stay idle is if you keep it as cash.This Boondogle, like most of the Bush Administration's programs, was not 'thought out' thoroughly before being proposed. The government's aim isn't for the people to go out and make conspicuous or unnecessary consumption (although that's going to happen anyway) That's Precisely what it intends for us to do with the Cash they 'throw' at us. We're supposed to buy Goods, preferably 'big ticket' items and 'Made in the USA.' But they can't tie a requirement like that to the distribution: or can they? I wish they would!

Spending the money on Services will not provide much Economic Stimulus although some of it will trickle down, not to big ticket Made in USA products but to Wal-Marts' and other Discount retailers that feature products made in China, Korea, India & Pakistan, etc.

I'm waiting for the other shoe to drop (i.e., they inform us later that those payments must be declared as Taxable Income).

With all the Economists on the Federal Payrolls, one might think there would be a Pro-Active Plan in the works (on the shelf, or whatever) that could be launched with a Git-Go order frrom the President. But what we get is 'Crisis Management' in a Re-Active rather than a Pro-Active mode. This is just another Failure to add to the GW Bush Administration's Record.

[shade]

Gold just reached a record $900 per ounce. I'm wondering where Ron Paul would find the money to rebuild Fort Knox, in order to reinstate the gold standard.

2 things:
1. You're wrong, I'll explain later.
2. Don't you wish you already had some gold money before the government debased your federal reserve notes? 2 months ago: http://www.youtube.com/watch?v=yAwvlDJgJbM
RON PAUL WAS RIGHT. AS ALWAYS. WAKE UP OH MY GOD. That is why gold is $900 an ounce.

Back on #1: Ron Paul is advocating that people be allowed to own gold without paying capital gains tax or sales tax on it. That would effectively make gold legal as a currency. He also is in favor of allowing a new gold currency to be floated, perhaps by the Treasury or banks. You get to keep using your federal reserve notes, but if you want, you can also used dollars that are linked to a fixed amount of gold.

You are right, it would be basically impossible to buy enough gold (although not really, with fractional reserve system) to replace all federal reserve notes. Even if there was, the market force of having all those FRNs chase gold would cause the price of gold to shoot through the roof. However, if individuals can buy gold if they want and keep it in a savings account along with the FRNs, and perhaps even spend it at places that accept it, the effect is much more subtle.

I would personally keep my savings account 50/50 FRN/Gold.

Bullet point gold plan of Ron Paul:
1. Let people buy gold (or gold money) without sales tax.
2. Let people sell gold (or gold money) without capital gains tax.
3. Let people keep gold (or gold money) in their savings account.
4. Maybe even let people spend gold money. Before you think that would be impossible to manage, I suggest you visit Canada where virtually every cash register can accept USD or Canadian - they just push a button that indicates what is being used for payment and it knows the exchange rate.



Side note: The idea of paying capital gains tax on gold is criminal. If one ounce of gold costs $400 and the fed doubles the money supply, gold goes to $800. If you sell that gold, you owe tax on a $400 "profit" all because the fed devalued your currency. Explain how this is moral. Unfortunately, this applies to the stock market and housing market, too. If the government needs more money, the fed can create new money, devaluing existing money, and then your assets are inflated. You then pay a tax on that.

[dead]

Side note: The idea of paying capital gains tax on gold is criminal. If one ounce of gold costs $400 and the fed doubles the money supply, gold goes to $800. If you sell that gold, you owe tax on a $400 "profit" all because the fed devalued your currency. Explain how this is moral. Unfortunately, this applies to the stock market and housing market, too. If the government needs more money, the fed can create new money, devaluing existing money, and then your assets are inflated. You then pay a tax on that.
capital tax is easily dodged just buy physical gold.;)
And 50% frn is a bit risky in this kind of market if you want to divert your much better of with the euro or renminbi or a basket of currency's other than the dollar.

[Henkie]

The alternative to going back to 19th century economics, ofcourse, is electing a governement that will deal with it's finances properly. The basic problem is a budget-deficit for the US governement, it's being dealt with, by manipulating money, printing more of the stuff, etc. But whatever you do with it, somebody seems to be losing money and somebody (usually the governement) is gaining the stuff. It ends up in a strange form of taxation, where people lose money because of inflation, and the governement gains money, because they're printing it. This all stops, and becomes transparent, when you accept that there is no magical fix to a budget-deficit and that monetary economy, on the large scale is always a zero-sum game. You need to elect someone who'll raise a penny in taxes for every penny he spends, not someone who will start two costly wars while cutting taxes. It just doesn't work that way.

And ofcourse, Ron Paul has the idea that gold will make that happen, because gold can't be manipulated (on which he's technically wrong, Medieval Europe had a problem with severe inflation because new coins were being diluted, and in the 19th century gold only worked because nobody was actually allowed to touch it), but you don't need to go rework the entire economic system, you just need a proper president that's not afraid to tax.

[JustinJJ]

im no expert in economics but this sounds bad. but pleasing at the same time. are we going do the road that germany took when it printed all that money she didnt have? i dont know. and hey isnt a war supposed to stimulate our economy. or is this an occupation? my family could use $1600 but no at the expense of our future. sometimes i think our economy is flawed, anyway. we go to work just to entertain ourselves. outside of living needs: house, car, food, clothes, medical etc. we spend so much money (on credit) for pleasures. and we have done so for so long our economy has to have it. lol people are buying cyber real estate. $400 video games. but hey thats capitalism, aint it. but i do love it:dunce:

That's a very scary thought:

http://img145.imageshack.us/img145/2146/weimarhyperinflationph5.gif

[MelL]

Someone let me know if I'm on the right track with this thought: the package has the potential to do a lot more harm further down the road since the idea is to stimulate spending. Since $800 and $1600 won't do much to save those in mortgage trouble, it's meant for those not in the middle of losing their homes or close to losing them.

So would that mean that if people do spend more then what is given to them through this package, you run the risk of more credit issues?

*Already planning that Roth IRA for his check if it comes through*

[Pajman]

This Boondogle, like most of the Bush Administration's programs, was not 'thought out' thoroughly before being proposed. That's Precisely what it intends for us to do with the Cash they 'throw' at us. We're supposed to buy Goods, preferably 'big ticket' items and 'Made in the USA.' But they can't tie a requirement like that to the distribution: or can they? I wish they would!

Spending the money on Services will not provide much Economic Stimulus although some of it will trickle down, not to big ticket Made in USA products but to Wal-Marts' and other Discount retailers that feature products made in China, Korea, India & Pakistan, etc.

I'm waiting for the other shoe to drop (i.e., they inform us later that those payments must be declared as Taxable Income).

With all the Economists on the Federal Payrolls, one might think there would be a Pro-Active Plan in the works (on the shelf, or whatever) that could be launched with a Git-Go order frrom the President. But what we get is 'Crisis Management' in a Re-Active rather than a Pro-Active mode. This is just another Failure to add to the GW Bush Administration's Record.
So the stimulus will have an effect if Made in USA products are consumed, but not products manufactured offshore? That's a poor economic analysis.
If Americans make poor financial decisions, who's fault is it? The president?

[Fungus Amungus]

There should be a law making sure credit companies can't loan money to people knowing they can't pay it back. Also the idea behind the stimulus is to provide investing options OR allow people to buy things which will benefit business which can higher new employees and such, or people can use it to pay off bills.

[shade]

The alternative to going back to 19th century economics, ofcourse, is electing a governement that will deal with it's finances properly. The basic problem is a budget-deficit for the US governement, it's being dealt with, by manipulating money, printing more of the stuff, etc. But whatever you do with it, somebody seems to be losing money and somebody (usually the governement) is gaining the stuff. It ends up in a strange form of taxation, where people lose money because of inflation, and the governement gains money, because they're printing it. This all stops, and becomes transparent, when you accept that there is no magical fix to a budget-deficit and that monetary economy, on the large scale is always a zero-sum game. You need to elect someone who'll raise a penny in taxes for every penny he spends, not someone who will start two costly wars while cutting taxes. It just doesn't work that way.

And ofcourse, Ron Paul has the idea that gold will make that happen, because gold can't be manipulated (on which he's technically wrong, Medieval Europe had a problem with severe inflation because new coins were being diluted, and in the 19th century gold only worked because nobody was actually allowed to touch it), but you don't need to go rework the entire economic system, you just need a proper president that's not afraid to tax.

I would appreciate it if you would stop misrepresenting Ron Paul's monetary policy ideas.

You are right about zero sum though - mostly. It is not quite zero sum for the US. Remember, other nations and people hold federal reserve notes. When we make new money, we are effectively taxing their notes as well. So its more like we get a 25% discount on our free lunch.

[Pajman]

I get confused when people say that the government prints money (to fund its activities). Is it a colloquial expression?

[shade]

I get confused when people say that the government prints money (to fund its activities). Is it a colloquial expression?

It is colloquial.

[Pajman]

It is colloquial.
So does it refer to the Federal Reserve executing outright purchases in the open market, or the Treasury issuing government securities?

[shade]

And lowering of interest rates. Anything that involves growing the domestic money supply other than foreigners buying US goods, basically.

[Pajman]

I see, so the idea is that the government somehow has the power to influence monetary policy directly. Interesting.

[shade]

I see, so the idea is that the government somehow has the power to influence monetary policy directly. Interesting.

Chicken and the egg. Lets face, the government does directly influence monetary policy. They know that the fed will bail them out, so they do whatever they want. By knowing how the fed will react (in general at least), they can trigger that fed reaction.

[Nocturnal]

1. Start digging
2. Realize you are stuck in the hole
3. Try to dig your way out.
4. Profit

"No! Dig up stupid"

I am going to put it in a savings account to go towards my local property tax at the end of the year.

You know the consumer is tapped if the government is willing to go into debt to keep people spending.

It's funny, but the govt. hopes that we spend this money ASAP. The irony is that as a people that is the last thing we should be doing with some windfall cash.

[Mr. Heskey]

I'm no economist, but I think the best thing to do is just 'let it be'.

Face it, we have a capitalist form of economy (sort of), and in it there's always going to be ups and downs. The beauty is, it'll fix itself most of the time.

[Nocturnal]

I'm no economist, but I think the best thing to do is just 'let it be'.

Face it, we have a capitalist form of economy (sort of), and in it there's always going to be ups and downs. The beauty is, it'll fix itself most of the time.

That is true, but the govt. can be very helpful in speeding things up. Especially if it's screwups or lack of oversight caused the problems to begin with.

[shade]

I'm no economist, but I think the best thing to do is just 'let it be'.

Face it, we have a capitalist form of economy (sort of), and in it there's always going to be ups and downs. The beauty is, it'll fix itself most of the time.

You are a more knowledgeable economist than most people on capitol hill.

[ItalianPunk]

IMO, I don't think that it will work. It didn't work in 2001 when he was talking about the economic stimulus package. What makes him think it will work now. It's just throwing money away. Like a drop in the ocean.

[Cerebral]

http://mauibear.maui.net/

[shade]

http://mauibear.maui.net/

LOL wtf??

message too short

[Cerebral]

LOL wtf??

message too short

I don't know either, but it don't look good.

[bonenator]

good enough plan to keep the economy lookin good....for now. basically for the rest of bushes time then blah

It's funny, but the govt. hopes that we spend this money ASAP. The irony is that as a people that is the last thing we should be doing with some windfall cash.

yeah but more than likely the lower income people will "need"(in their minds) to spend it. alot to fix debt, others to waste on a new tv. meanwhile the US plunges deeper into debt. the smart will save, semi fucking the plan over.

[Master. kirby]

wait, so I'm getting $800?

when?

(yes I'm over 18 and paying taxes)

but in the end if everyone else does, how does that really help anyone?

isn't that the same as say, giving a trillion dollars to everyone, wouldn't it just make that specific amount meaningless?

[MelL]

wait, so I'm getting $800?

when?

(yes I'm over 18 and paying taxes)

but in the end if everyone else does, how does that really help anyone?

isn't that the same as say, giving a trillion dollars to everyone, wouldn't it just make that specific amount meaningless?

As I asked earlier, though nobody answered my question, doesn't it seem like the package would run the risk of making things worse? If everyone does spend the money they receive, the deficit as expanded by the handout is still there and the further economic activity won't make up for it. And to make the stimulation (heh heh, I said 'stimulation'...) really work, people would have to spend in excess of the amount they would receive. Well, if they had it to spend and wanted something, they would already be doing so, right? So wouldn't this also possibly aggravate the issues about credit if it furthers people debt because they were encouraged to spend more?

[shade]

As I asked earlier, though nobody answered my question, doesn't it seem like the package would run the risk of making things worse? If everyone does spend the money they receive, the deficit as expanded by the handout is still there and the further economic activity won't make up for it. And to make the stimulation (heh heh, I said 'stimulation'...) really work, people would have to spend in excess of the amount they would receive. Well, if they had it to spend and wanted something, they would already be doing so, right? So wouldn't this also possibly aggravate the issues about credit if it furthers people debt because they were encouraged to spend more?

The package is literally requiring that everyone take out an $800 interest only loan at about 3.5-4.5%.

So, ask yourself this. Right now would you like to have $800 if it meant you had to pay $28-36 a year for the rest of your life? Your children will have to pay for it the rest of their lives as well, and possibly even your grand children. If the answer is yes, then you should like this stimulus package.

[Master. kirby]

The package is literally requiring that everyone take out an $800 interest only loan at about 3.5-4.5%.

So, ask yourself this. Right now would you like to have $800 if it meant you had to pay $28-36 a year for the rest of your life? Your children will have to pay for it the rest of their lives as well, and possibly even your grand children. If the answer is yes, then you should like this stimulus package.

but but but but but but but, I can go out and buy a 360 elite, a bunch of games, and a subscription to xbox live!!!!!!

maybe even an airsoft gun!

Btw I'm a certified dipshit.

(I can't get banned for personally attacking myself right)?

[Pajman]

The package is literally requiring that everyone take out an $800 interest only loan at about 3.5-4.5%.

So, ask yourself this. Right now would you like to have $800 if it meant you had to pay $28-36 a year for the rest of your life? Your children will have to pay for it the rest of their lives as well, and possibly even your grand children. If the answer is yes, then you should like this stimulus package.
The $800 is not entirely a lost revenue; there are the effects of money multiplier, consumption tax, tax on investments, corporate tax, etc. that stems from the stimulus.

[IrishNed]

wait, so I'm getting $800?
when?
(yes I'm over 18 and paying taxes)
but in the end if everyone else does, how does that really help anyone?I never did figure out where the $800 figure came from.

This Morning, I heard a News report from House Ways & Means Committee Chairman Charles Rangel (D NY) after a late night Session on Capitol Hill. Now they've trimmed down that $800 Individual Tax Rebate to $300; and are in the process of tightening rules & Regulations about who qualifies and who doesn't. Even if a supplemental appropriation Bill passes tomorrow, you're not going to see any money until May or June (or later). By then it will probably be too late to have much of an impact on the Economy.

So, I hope you haven't made any big plans for $500 of that so-called Rebate

[avix123]

Also non-tax payers will be receiving a check. So I guess instead of giving tax payers a nice amount, they'll spread it out among a greater population in lesser amounts?

[chalupa]

PEOPLE WHO DO NOT EVEN QUALIFY TO PAY TAXES WILL GET A $300 TAX REBATE, PLUS $300 FOR EACH CHILD, UP TO $1200.

I seriously want to walk into Congress, head up to the podium, and tell them all to go fuck themselves.

Fucking socialist retards.

I'm sick of this shit. Either you're on board with the Socialists because you think the govt shouldn't be able to tell fags if they can get married or not, or you're on board with neo-conservative Bible-thumpers. Fuck this.

If enough people start making noise about this, Libertarianism is gonna take off.

[avix123]

IOW, it's a welfare check.

[Pajman]

Side note: The idea of paying capital gains tax on gold is criminal. If one ounce of gold costs $400 and the fed doubles the money supply, gold goes to $800. If you sell that gold, you owe tax on a $400 "profit" all because the fed devalued your currency. Explain how this is moral. Unfortunately, this applies to the stock market and housing market, too. If the government needs more money, the fed can create new money, devaluing existing money, and then your assets are inflated. You then pay a tax on that.
That would only make sense if the return on your investments doesn't exceed (or is equal to) the rate of inflation. If your assets yield a real return, you are making money. Therefore, you get taxed. The dollar didn't lose purchasing power by the amount that gold appreciated.
How much money did you make in 2007 from investments? Unless you're a lousy investor, you should have outperformed inflation by far.

[Spike Lee]

PEOPLE WHO DO NOT EVEN QUALIFY TO PAY TAXES WILL GET A $300 TAX REBATE, PLUS $300 FOR EACH CHILD, UP TO $1200.

I seriously want to walk into Congress, head up to the podium, and tell them all to go fuck themselves.

Fucking socialist retards.

I'm sick of this shit. Either you're on board with the Socialists because you think the govt shouldn't be able to tell fags if they can get married or not, or you're on board with neo-conservative Bible-thumpers. Fuck this.

If enough people start making noise about this, Libertarianism is gonna take off.
Or maybe its smart because in this time we need spenders not savers. People who are welfare abusers will spend that money like crazy.