What's up with the Stimulus Bill?
What is the main idea behind the math?
Isn't there a need to cut a break and think things over when you are broke
Does it actually appear helpful, mathematically?
Can the value of the dollar be at stake?
Is it really gloom or doom regarding it?
Why pass it so fast?
- 1 decade agoFavorite Answer
The stimulus bill is designed to help certain areas of the economy, which we are hoping may help bring back up the rest of the economy. Actually, it is most probably just going to help keep the economy from getting worse than it already is. It does appear to be helpful mathematically, simply looking at the size of it, but it generally depends on consumer confidence, which to me doesn't look so hot, especially since Obama's speeches are geared towards preparing America for a devastating financial blow. The value of the dollar hit an all-time low earlier back when Bush was president and the global economy hadn't yet caught up, so all the Europeans were coming to shop here cuz the $'s value was so low. It is better now and I don't think it will go past that low as it was before. I don't know exactly what you mean by doom and gloom, but without there would be and it has to be passed quickly else with the credit crunch, and stocks and mortgages plummeting so much, the economy may completely hit rock bottom and unemployement will sky-rocket and the government doesn't have enough money to have so much welfare, and it would bring on another great depression and bring down the rest of the world with it in theory, but I don't think that would really happen, so I'm not too worried. Just make sure any investments you make are for long term and try not to look at your 401K for a while. My mom lost $10,000 because the economy and my father significantly more. It pushed back their retirement plans even-that's how bad it's gotten.Source(s): I watch the news and have a general understanding of the market.
- Anonymous1 decade ago
There is one thing that we/they know for sure and that is that if we wait and hope that the economy will self adjust, it won't. We have seen the failure of that plan in the "Great Depression" and when Japan tried it and wound up with the Lost Decade as a result.
What we/they do not know is what will definitely work. So much of this is trying to regain confidence in the system and that can't be done on a one on one basis. It is also hard to do on a national basis because everybody is different and responds differently. All that we/they have learned is that what ever is done needs to be done quickly. If that doesn't work then try something else.
What Paulson did by bailing out the Banks did not work. The money did not trickle down. Now they are going to try dealing with the owners of the at risk of foreclosure homes and see if the money trickles up to the banks. A more likely outcome.
The math says that if you want to stimulate the economy by $1 million you infuse $600,000 and it grows to $1 million. The less specific math has to do with tax cuts. If you increase taxes business will just pass the tax on to the customer duble taxing the consumer. If you cut taxes though the cost cut never seems to reach the customer. So it seems that business wins either way. And the consumer? Not so much.
The value of the dollar is always at risk, but measures are taken to back up the value of the buck. Long term bonds are sold to other countries, like say, China who owns a trillion dollars in our debt. They have a vested interest in not selling that debt. If the dollar goes bust so does their best customer and so goes their own economy.
Do something and if it doesn't work try something else. No one has a better idea I'm afraid.
- gosam777Lv 71 decade ago
Just like the last stimulus plan. The main idea is not much different than someone in serious financial trouble, who goes to Vegas, and hopes like hell the numbers he picked come up a winner.
In theory it could work. Our biggest problem is the players. Paulson took his shot, and what we got for the 1st 800 billion was OOPS! The next stooge, Geithner, comes into a press conference all but admitting (or maybe he did admit it) he is dazed and confused.
In reality, it is a race against time. With the housing market collapsed, and crude oil dropping like a rock, the risk is deflation. Without massive tax cuts in place, deflation can spiral out of control, and we get into real problems.
It was passed very fast by Congress, but once passed, not signed into law by Obama, until 5 days later. Meaning no time for the public absorb it, and comment to their representatives, as promised by the administration. No time to debate it, or really understand what is in it. Even most "experts" are just now beginning to comprehend it. But too late now even if there are objections.
- AnarchistLv 71 decade ago
Quantitative Easing – This is a luminous term that 98% of Americans don't understand.
It sounds so soothing. When Ben Bernanke uses the term in his speeches you can imagine blue birds singing on his shoulder.
What it means is that the Federal Reserve will print as many dollars as it takes to generate inflation so that the country's enormous debt burden can be inflated away.
Instead of one helicopter, picture thousands of B-52s dropping dollars over NYC.
Japan tried the same thing in the 1990s with absolutely no success.
Obama's motto is, when you earnestly believe you can compensate for a lack of skill by doubling your efforts, there's no end to what you can't do.
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- j615Lv 41 decade ago
The price is up. Outside of that, no one can tell you much of anything.
It is a mess. How could you expect anything else from Nancy Pelosi?
Just hold on. We might be looking for change in the sofa cushions.
- 1 decade ago
big waist of money. "Haste makes waist"