The government is spending trillions of dollars and you are wondering, how this is going to help you? More than likely if you are paying your bills on time and didn’t over-extend your credit then you will not see any benefits.

The majority of this money is being used to fill the holes that have been punched in the economy from the recession. For example, The Banks loss trillions of dollars, so some of it goes to the banks to make student, business, auto, and home loans. Unemployment is going up and the pool of money the government have is not enough so money is going there. There are millions of foreclosures, so money is going to homeowners to help them pay their bills. Energy and gas prices are assumed to go higher, so money is going to alternative energy sources.

Okay, so where is the risk? Why do I care? Are my taxes going to go higher? If everything goes to plan, there is no risk, recession passes, hiring picks back up and we back to normal. The probability of that happening is very small. The other two sides are as follows: Economy keeps slowing down and no matter how much the government spends we go into a deep prolonged depression. Not good, you will probably see a lot of job losses, crime rate up, businesses closing on every corner and so forth. Then the other side is the government spends too much money and the economy starts growing way too fast. Hyper-inflation kicks in, which means the dollar collapses and it’s not worth anything. A loaf of bread is $7 dollars, a gallon of gas is $25 dollars, and your taxes are 50% of your pay check. I hope everything turns out okay, but right now it’s not looking too good.

1. A friend of mine just emailed me one of your articles from a while back. I read that one a few more. Really enjoy your blog. Thanks

   Posted by Josh Maxwell | February 18, 2009, 3:00 pm

2. I’ve been reading along for a while now. I just wanted to drop you a comment to say keep up the good work.

   Posted by Mike Harmon | February 18, 2009, 3:16 pm