Ooh, ooh that smell

This is a piece I wrote in response to a post on the urbandigs blog I have been following recently. I think my view differs just a wee bit. I would like to say that the author's recent participation in a telecast covering the housing and stock market issues was very good, but another participant, a professor, was absolutely brill. I look forward to hearing more out of them both. My rant was aimed mainly at those readers posting comments on the blog.

Ok....lets talk $ and sense.

Nat. Debt 9.2 tril
2007 Deficit 600 bn
Tax Rebate 150 bn
Iraq War 168 bn
Other stimulus ??? bn
Proj 2008 Deficit 1.0 tril
The dollar is down...again

The tax rebate will give up to $600 to single americans with incomes up to 75k and $1200 to couples up to 150k. It only applies to those with earned income so many on social security wont see a dime. It also won't be hitting people's mailboxes until May. From reading the comments on various posts about incomes, I doubt many if any of the readership here qualify. And just how much stimulus is this really? 1 mortgage payment on a 150-200k loan? Is this enough to save a default? Maybe if you have a 50k mortgage--and you are married you might make 2 or 3 payments.

At this moment every citizen of this country owes over 30k due to nat. debt alone. Only about 20% of the population has the ability to pay this if it were demanded today. The majority of the readership of this blog is probably in the group that could, so maybe this doesnt affect Manhattan and similar markets at all.

So how far in debt does this country go to bail this thing out? Where does the money come from? We are in debt so we dont have it. Does the Fed print some more, and devalue the dollar further? Borrow some more from the Chinese and others? If these loans get called in how do they get paid back? Print some more money or borrow some more? Oooh wait, lets raise taxes! Those people really didnt need that tax rebate last year.

Throwing huge sums of money into stimuli that have so little impact on the root problems of this issue is sheer madness. Smell it piling up? Shovel some now or shovel more later...hmmmm....what if I'm too old to shovel later? Anyone care to shovel for me?