Economy and solutions

The media and the politicians have let us down and why only the media can remediate this.

Framing the narrative of what is needed to stimulate, fix, or address the economy is being missed by most of Americans. The reason they have missed the message is not due to a lack of promises and plans, but instead the media not discussing an accurate size of the rebates.

Any simple financial illustration will show that the rebates are much more in value to the consumer if they expire high interest debt or long term debt.

As an example, $500 on the following illustration will result in a three thousand dollar rebate. Using the illustration of this default loan, and making a $600.00 payment on principle after the first month http://www.hsh.com/calc-amort.html will yeild $3499.31 and 6 payments off of the life of the loan.

Here is another useful tool, http://www.octfcu.org/calculators/java/payoffcc.html that illustrates the amoritization schedule and the benefits of paying that stimulus rebate to these types of loans. If you were to apply the $600 to the default loan at the calculator you would add 88 dollars to the reabate.

The higher the interest, the longer the terms, the more the rebate is worth.

Now when I hear the solution for our economic problems being to 'shop our way' out of the crisis, I have to laugh. Any serious media outlet that has a segment on money and news and does not advocate this to their viewers, care more for their ad dollars than the viewers, and truth be told have ridiculous people who buy the spot ads, as the real effect in wealth in the economy, purchasing power, is increased with the approach I advocate.

After 911 the President of the United States asked Americans to go shopping. Don't give blood at the blood bank, don't push a recycling drive, don't buy war bonds, now that we are at war, we have to make those tax cuts on the wealthiest Americans permanent, or "as assuredly as I stand here today" the POTUS will come on TV and beg us to pay less taxes and go shopping again!

Now I know that taxes don't increase revenues necessarily, and the 'necessarily' is a predicate for the economic conditions that surround us. But I know dman well that a sick economy struggling with bad debt, can be cured the fastest by aleviating the amount of overall debt! This requires less dollars to be introduced into the economy to pay off that debt later. This allows injection of funds and can at the long end of the debt cycle be anti-inflationary and stave of deflation.

But what to make of the POTUS and the media that tells us to go shopping when our economy is in a mess?

Well to be succinct either the audience is dumb, the people making the suggestion we shop our way out of debt are, or an exclusionary proposition is not appropo and both the above are true.

The real point is that we want the most bang for the buck that 150Billion buys, for what 1% of GDNP stands for, and that is up to the media to narrate in examples where the debt average is discussed, examples of the amount of the rebate are discussed, and $600 can equal $688 or $3499.31.

The economy is in need of re-hydration of the reserves available to debt, and the demands upon debt, (the number of total debt) at the long end chasing the amount of dollars in circulation.

Shopping is not an appropriate response to these types of challenges.

I hope the media can get the information, create the narrative, and explain the rebates in a better manner than the naive belief that it is 'patriotic' to spend on a shopping spree, or that if everybody would just light-up one dollar (to fight inflation LOL!) or an equal fallacy, that if everybody just does some shopping that the economy will repair, or that cutting taxes always increases revenues, we see that wisdom and economics are often exclusive.

We can't shop our way out of this circumstances, and the best thing that Americans can do if they love America, care about fellow Americans, is to expire the long end debt that they have.

Anybody who claims otherwise is a damned liar, and I said so.