Obama, Where's My Stimulus Money?
I Want My Share!
A couple of months ago a report stated that the Obama Administration and congress are working to increase the economic stimulus to 9.7 trillion according to Bloomberg.com. So far I haven't seen any benefits. If this goes through the government would have committed about $31,682 for every man, woman and child in the United States. I just have to ask the question, where's my money, and more importantly where is it coming from.
If the government continues to spend trillions of dollars to stimulate the economy eventually you and I will have to pay for it. If the economy does not strengthen, the dollar will weaken against other countries' currencies and everything we import becomes more and more expensive. Maybe then we will start to make things in the U.S. again.
Guess what happened during the first quarter 2009 earning season? Big banks are claiming record profits, thanks to the free ride they get. The underside of that is showing up in the market as they report their great earnings and also state that there will still be enormous write offs coming.
Is There a Better Plan?
Here is a better idea. Why not just give the money to the people. They will ultimately have to pay the bill for it anyway. It seems like a better idea than giving it to big corporations that have proven their inability to manage money already. If I received $31,682 for each member of my 6 member family, I would receive about $190,000. If every family in America received a similar check it might do more to help the economy than the current plan
For example, if I receive a check for $190,000, the first thing I would do is pay off any high interest consumer debt. This would be things like credit cards, and other small unsecured loans. Who am I kidding, I would probably take a nice vacation and then pay off the debt! The next thing I could do is pay down my mortgage and refinance to a new lower rate. Doing just these 2 things could stimulate the economy as much as the government has done. Think about it. If everyone was able to payoff their credit cards and pay down their mortgage what would happen? First, there would be a huge influx of cash to the banking system, probably as much as the government is already giving them. The added benefit here is that now people would have cash to spend. Under the current plan, banks are getting the money and tightening their lending practices at the same time. The average consumer does not benefit.
If Obama gave you the stimulus money directly, would the economy recover faster?
Obama, just give me the money!
What Would I Do?
If I had my money, the money I will have to pay as a taxpayer anyway, I could at least improve my situation to the point that if I had to take a lower paying job because of cutbacks and economic depression, I could. But that would not happen. By sending everyone their own stimulus checks money would start to immediately start to flow through our capitalistic system. With all of the money being pushed through the system, house prices would start to increase. People could afford their current home. Families that were renting would be able to purchase home. Banks would have money to lend and be able to relieve their books of the "bad" assets they had.
Instead our government has chosen to fund the banks directly and now the average taxpayer has to wait until they decide to start stimulating the economy. Unfortunately, what we have seen is a number of them trying to stimulate their own executives and promote their own self interest. It seems crazy to think that the banks will get free funds from the government and before they will work with you to fix a problem you might have. These are the same banks that created the problem with their poor mortgage products and lending practices. You have to ruin you credit in many cases before they will even work with you. The end result is that the banks get a free ride from the government while consumers like you and me have to forfeit our credit and take the consequences thereof for the next 7 to 10 years, not to mention the effects of this will most likely cause inflation which will end up costing us more and more in the years to come.
Get Your Finances In Order
If you received a giant stimulus check from Obama, how would you handle it?
Learn to Take Care of Yourself.
Whether or not Obama cuts you a big check you have to learn to survive. Learning to manage your personal finances has become one of the most important and critical things to do on a daily basis for many people, and if you are not in that situation now you could easily be shortly. There is no guarantee in life other than that you can always bank on changes occurring. Those who have prepared will adapt quickly to the changing environment and those who haven't will learn to. Why not start today? Like Obama says, Change!
Set some goals and make some plans. Now is the time to take change and make your own changes.