This has been a big week for “economic stimulus.” The Fed announced an emergency rate cut on Tuesday and yesterday Congress unveiled a tax rebate package. But will it really help? The numbers are different from the $500 tax rebate that was being floated earlier.
Instead, some working Americans will get $300 and others will get $600. Some joint filers will get $1,200. It sounds nice, but as I’ve been saying for a while, it’s not really practical. Our government is already running a deficit and most people don’t spend tax rebates and refunds on things that would help them financially.
The government just wants us to spend the money, rather than use it to shore up our personal finances. This bothers me. The way to “stimulate the economy” is to spend the money. This is not good for personal finances. Instead, you should pay down debt or save/invest it.
Besides, didn’t we do this five years ago? Funny how we’re right back in the same place. I guess that economic stimulus didn’t change things in the long run. How will this be any different. It probably won’t.
How will you spend your tax rebate?
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