There is some hope that this good thing could live on after June 30. If the housing market and the economy is not in full recovery mode by late spring, there is already discussion about Congress extending the tax credit again, according to Jaret Seiberg of Concept Capital, a Washington-based research group.In the article, CNN tells happy stories about people who receive the money, but completely ignores the fact that other people have to pay for it eventually, plus interest.
All our problems would go away if everybody just received free money from the government, wouldn't they?
I support stimulus spending. All I ask is that the spending add to our country's physical or human capital stock (i.e. useful infrastructure or knowledge), because those contribute to economic growth. Spending taxpayer money to transfer pre-existing houses from one person to another doesn't do that.
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ReplyDeleteyeah it is a good point!
ReplyDeletespammy spam spam
Okay, the BEST way to prevent precipitous declines in asset prices is to prevent the formation of asset price bubbles in the first place. Failing that, (and boy did we fail) intervention to preserve enough liquidity in the mortgage market to enable prudent purchasers to buy is a GOOD thing. The alternative is that prices fall far below the "cashflow" level and the wealthy become landlords and the rest of us tenants.
ReplyDeleteBut what we have seen is intervention WAY to early, and at price levels that are still unsupportable in the long term. This is a failure because firstly, we have expended our maximum effort long before it can do any good. And secondly, this means that this money has gone to bailing out the imprudent, stuipid, or culpable and will do little to support prices in the long term. Piling sandbags on the low tide line does little good.
-Jim A
As a general rule, CNN is news for imbiciles. FOX is news for malevolent imbiciles.
ReplyDeleteMSNBC (between 4 hours of Morning Joe and Keith Olberman) can't decide exactly who to be.