Economic Fix, sometimes simple ideas are best

[soutthpaw]

You have a point, Didn't something similar happen with the first stimulus check. all the financial adviser folks said save or pay down debt. yet many people went and bought new LCD TV or Tuner Chips heh!

I know we used it to pay medical expenses

[bbbxcursion]

I spent it at the booby bar. Gotta support single moms.

[Jackpine]

Originally Posted by soutthpaw

You have a point, Didn't something similar happen with the first stimulus check. all the financial adviser folks said save or pay down debt. yet many people went and bought new LCD TV or Tuner Chips heh!

I know we used it to pay medical expenses

No, as I understood it, things didn't happen that way at all. People actually used it to help pay the bills or they put it into savings (excluding bbxcursion, of course) :ford boob girl smal :o

The HOPE, from our Administration, was that people WOULD go out and spend, on big ticket things like TVs and cars. But that didn't happen.

I DO kind of like southpaw's suggestion though, an across the board reduction in mortgage interest by 1% (down to 4% minimum) for mortgages in good standing makes a lot of sense. Of course, the banks would scream bloody murder, but they might just come out better, if fewer people defaulted on their loans and banks didn't have to foreclose on depressed properties. (They REALLY lose money when they have to "short-sell" a property and they lose even more when they take possession of it and can't sell it but have to pay taxes and other upkeep expenses).

- Jack

[kokopellimotorsports]

To go back further, I don't even know why housing appreciates. It would make more sense to have it depreciate with time like most other things.

Ty

[soutthpaw]

My beef with this whole situation is we are punishing responsibility and rewarding irresponsibility... my idea was to create a situation where the opposite happens...
Jack, I knew people did the opposite of what the government wanted them to do with it. Just couldn't remember of the top of my head what it was.
I think that my idea would put more money in the hands of responsible homeowners; who would use it more wisely that giving a handout to every American....
As for Bill's point Government is already jumped into the whole thing with both feet.. We are not going to get them out any time soon... Government has got bigger under every president for the last 40 years too. ( read that is a news article somewhere)
its about having a smart and streamlined government...( not how big or small it is) One trip to any DMV it a good representation of how government and its various agencies are totally screwed up...

[soutthpaw]

here is a simple analogy the school bully beats up some kid and takes his money.. lets give the kid who got beat up detention and let the bully keep the lunch money...
Basically what these different financial rescue and stimulus bills are doing

[Jackpine]

Originally Posted by soutthpaw

here is a simple analogy the school bully beats up some kid and takes his money.. lets give the kid who got beat up detention and let the bully keep the lunch money...
Basically what these different financial rescue and stimulus bills are doing

Somehow the little guy always takes it in the ear (and other, more painful places) doesn't he? I wish there were a way to let AIG, CitiGroup, GM and similar companies fail without hurting all the employees who put their faith in those companies. And, without hurting all the smaller companies that do business with the big ones, like the parts suppliers to GM.

I'm not bright enough to figure out how to do this though. I doubt anyone really is. (If only there were a way to prove "criminal intent" on the part of the executive officers that set up conditions that allow these situations to happen).

- Jack

[88Racing]

Just thinking

Fair-flat tax everyone and everything 12%.
No socialized medicine.
Tax breaks/incentives for corperations who bring jobs and or products back to USA.
The mortgage idea.
Any businesses in USA can't bank over seas. NAFTA countries only.

Just some thoughts.

Lars

[Sburn]

Originally Posted by kokopellimotorsports

To go back further, I don't even know why housing appreciates. It would make more sense to have it depreciate with time like most other things.

Ty

Housing appreciates because the underlying utility value doesn't change. With a few percantage points of the total yearly mortgage spent on basic maintenance, a house is just as good of a dwelling 50 years after it was built.

So the value should go up roughly at the same rate as inflation. That value is the cost of building or replacing a structure plus the infaltion rate over the years.

Also, house values are also determined by the prevailing rents in the area. That's what a bank would look at if you were aksing for a loan to buy a rental property. Prevailing rents are pretty much determined by what the average hosehold monthly income is.

Any more appreciation beyond the above tends to be speculation, i.e., the buyer thinks the value will increase more than the rate of inflation and there will be a buyer when it comes time to cash in. Or, that somebody will pay a premium over renting because they want to own a place of their own.