Economic Stimulus: Tax Cuts vs Government Spending

[saden1]

The question is what will people be doing with the tax cut money in the next two years? Will they be buying essential goods (food, school supplies, and cloths) or non-essential goods (cars, big screen TVs, and that nice new shaver)?

[Trample the Elderly]

Originally Posted by saden1

The question is what will people be doing with the tax cut money in the next two years? Will they be buying essential goods (food, school supplies, and cloths) or non-essential goods (cars, big screen TVs, and that nice new shaver)?

That depends on who's asking. If it is to get the money, I'm all ready to be a good consumer for the cause. If it is after I've gotten the money, it will go into my retirement account where I can make interest off of it.

I'll have to do my homework on the IMF and the World Bank. I've heard of them but I just assumed they were currency cartels set up ny the central banks to manipulate the real value of money.

Why does it have to be either or? Why have tax cuts or bailouts? Why can't we just stop spending?

[Schneed10]

Originally Posted by saden1

The question is what will people be doing with the tax cut money in the next two years? Will they be buying essential goods (food, school supplies, and cloths) or non-essential goods (cars, big screen TVs, and that nice new shaver)?

Like I said, poorer people will feel financial pressure to tap into that money for essentials. That will boost earnings, profits, and ultimately stock prices.

Stock prices are the biggest driver of consumer confidence. Once the stock prices start coming back up, a lot more people will feel easier about opening their wallets. And before you know it the nation's velocity of money is at full tilt again.