Who is giving our president advice?
WASHINGTON (MarketWatch) -- The recently enacted fiscal stimulus package will add 1.5% to the economy, President Bush said Monday. The stimulus package should be given a chance "to kick in," Bush said at a meeting with business leaders. He also acknowledged consumers are still hurting, citing worry about the cost of fuel in particular.
Let's say the economy is about $12 Trillion and the $160 Billion dollar package is about 1.5% of the economy.....if every dime of it is spent.
The problem is that surveys have shown that much of the rebates will go to paydown debt. Paying down debt adds little if any stimulous to the economy. Until we figure out a way to materially cut costs or increase income, paying off $600 of debt will likely have very little stimulous effect.
Reality and projections are seemingly getting further and further apart lately.