Seen a lot of pundits argue this stimulus will lea
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Posted On: 04/11/2020 8:41:50 PM
Seen a lot of pundits argue this stimulus will lead to hyperinflation. They're all looking through the prism of a normal economy, when interest rates were normalized (ie 6% 10yr bond). We aren't going to see hyperinflation AT ALL; never again. Didn't see it during the internet boom. Didn't see it post financial crisis and haven't seen it with rates at near zero for a decade even with full employment. ZERO CHANCE.
All the govt is doing is giving people money to pay their regular bills. It's supplanting lost income, not throwing fuel on the fire. People are just turning around and paying bills & buying food/gas. The money these people are expecting is already spent for the most part.
They should have waited to do it until the antibodies testing was available to the masses and they could send people back to work. So....expect them to do it again.
They should also reduce capital gains taxes to 0% (short & long term) for anyone earning less than $200k for the next 12 months. Send people a postcard to refinance any mortgage that's being paid on time to 2%. Sign it, provide lender info and loan number and mail it back. That will inject some much needed money into the post office.
But i wouldn't be bailing out a single company nor sending these checks to individuals (at all) so soon. Biz's can file chapter 11 to reorganize debt and continue operations. People should have a rainy day fund of at least a half year, minimum. Heck i had one when i bartended 30 yrs ago. The moral hazard is off the charts. Completely against socializing losses. Capitalism ignores excuses.
But a funny thing may just happen. if the Federal Reserve buys enough assets, they may wind up w/ a huge windfall (think trillions) that could make the first sizeable reduction in the deficit in...i don't even know how long it's been. I think the last balanced budget was during Clinton but can't recall the deficit ever actually dropping. Naaaaa....no way the politicians pay down debt. What was i thinking??
Some great CYDY coverage! Hope it continues.
All the govt is doing is giving people money to pay their regular bills. It's supplanting lost income, not throwing fuel on the fire. People are just turning around and paying bills & buying food/gas. The money these people are expecting is already spent for the most part.
They should have waited to do it until the antibodies testing was available to the masses and they could send people back to work. So....expect them to do it again.
They should also reduce capital gains taxes to 0% (short & long term) for anyone earning less than $200k for the next 12 months. Send people a postcard to refinance any mortgage that's being paid on time to 2%. Sign it, provide lender info and loan number and mail it back. That will inject some much needed money into the post office.
But i wouldn't be bailing out a single company nor sending these checks to individuals (at all) so soon. Biz's can file chapter 11 to reorganize debt and continue operations. People should have a rainy day fund of at least a half year, minimum. Heck i had one when i bartended 30 yrs ago. The moral hazard is off the charts. Completely against socializing losses. Capitalism ignores excuses.
But a funny thing may just happen. if the Federal Reserve buys enough assets, they may wind up w/ a huge windfall (think trillions) that could make the first sizeable reduction in the deficit in...i don't even know how long it's been. I think the last balanced budget was during Clinton but can't recall the deficit ever actually dropping. Naaaaa....no way the politicians pay down debt. What was i thinking??
Some great CYDY coverage! Hope it continues.
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