Question
Let's say the Bush cash giveaway takes place in one form or another, how much of that money is likely to be spent and how much is likely to go straight to the debtholding companies?
posted by mikevotes at
1:34 PM
6 Comments:
Do we have any statistics regarding the last cash give-back from a few years ago? Actually, if I remember correctly, that was actually an early refund and thus was revenue neutral.
Unless folks have creditors knocking at their door, I think the majority will engage in the narcotic of excessive consumption. My wild assed guess would be 70% blow it, 30% either pay down debt or save it.
By
-epm, at 1:52 PM
Economic policy is outside my comfort zone, so, I'm just guessing, but from personal, anecdotal memories of the previous giveaway is that most people just put in in their bank/checking/investment accounts and didn't do anything with it.
Of course, $800 would be alot more money. Maybe I need a new TV?
I guess the Chinese might like a little of our economic stimulus.....
By
mikevotes, at 1:56 PM
Also, I read somewhere, the Bush giveaway is something like $185 billion, which would mean by your estimate, the debt companies would get $60 billion.
Not chickenfeed.
By
mikevotes, at 2:03 PM
Of course the Government could just give the money directly to the creditors....or would that be too obvious?
By
Anonymous, at 2:13 PM
Exactly. Can't have the impression of a corporate bailout.
These are "individual tax cuts" after all.
By
mikevotes, at 3:20 PM
I think this is an attempt to forestall the visible erosion of the credit problems that aren't in the newspapers yet: credit cards.
The giveaway money is fiat capital anyway, which is to say that it's created by the Fed out of ones and zeros. In other words, it costs the government nothing.
It will make the balance sheets of credit card companies look better, and give the current administration some breathing room.
By
r8r, at 3:45 PM
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