How to wreck the economy

January 28th, 2009
By Bill Colias © 2009

Everyone wants a healthy dynamic economy. I think even the congressmen do, too. But this is not evident by what they're planning to do by planning to pass a stimulus. Stimulus packages that are designed around government spending has never worked in the past, and will not work today. Its not that the projects planned to be funded does not have any merit, many of those projects do. Its just that such massive spending as is being planned will most probably drive us into a full fledged economic depression. Increasing the money supply will inflate our money, followed by deflation as jobs continue to be lost. Already, from what is spent we are doomed experience this cycle to some extent, but passing the alleged "Stimulus package" only excaberates the problems with the economy. The "Stimulus" infuses credit and debt into the economy because the government creates the money out of thin air and thus immediately creates more credit and debt.

Here is my prediction if the Stimulus package is passed--

In spite of some short term recovery within six months, inflation will begin to rise. This will probably hit us with double digit inflation in a years time. Any short term employment created will be overwhelmed by massive unemployment. In about two years time demand for goods will precipitously drop, followed by a drop in the price of goods. However, most people will still not be able to afford these goods because most will still be unemployed.

Sorry to be the bearer of bad news.