If Deflation it is.........

Discussion in 'Economics' started by toc, Dec 16, 2008.

  1. toc


    Seems like Deflation is getting into action what are the 'jump start' alternatives available to the US.

    1) Start war with Iran.........can go zippo if they do not fight back and become good guys.

    2) Slow the removal of troops from Iraq and increase in Afganistan. While it costs billions to maintain, these billions also are channeled to various industries supplying the military....machines, dresses, food etc.

    3) Stop all the hybrid energy programs. Higher crude prices justify higher prices which in turn keep companies in the profit and just not laying off people. But a very fine line here.

    4) Encourage 'New Gaints' China, India, Brazil to keep consumption high and invest in their infrastructure by taking low interest loans from the US.

    5) Give temporary bailouts to companies, people which keeps them going to work and not to the welfare offices. The money will have to be returned later on.

    6) Drastically cut government budgets in order to make the bailouts more practical without messing up the basic accounting principles.

    Obama has a tough task at hand and he should not look at second term but how to run a good shop and clean out atleast half of the toxic issues.
  2. clacy


    I agree that Obama has his work cut out for him. HE MUST FOCUS on the problem at hand, or there will be no 2nd term.

    He must also focus on this ecomic crisis and let most of his agenda fly by the wayside, as did President Bush in lieu of the war on terror.
  3. Free health care for all would be an awesome stimulus actually. Instead of exporting those dollars to China, they'd stay here.
  4. clacy


    I don't really see where you're going here. Are you saying that due to higher taxes, there would be a net decrease in the amount of discretionary spending, and therefore less money to China, and more money to IRS (and eventually to health care system)?

    Free health care means:

    Higher taxes in order to pay for it = less discretionary spending

    I would see that as a net wash as less money for retailers, restuarants, etc and more money for docs, nurses, pharma
  5. anouka


    This one really sounds like a good option, if the Fed is planning on cutting the interest rate to as low as 0% maybe a higher rate would still be tempting to foreign countries. That would be wiser than continuing to put good money after bad.
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