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A big problem is many, who consider themselves educated, owe more money each month in interest and rents than the have in savings. Government guaranteed, below market loans, with little down are the cause of a lot of hardship. They also fuel the higher rents now common.
Housing is a multi-faceted problem not just loan guarantees which is one problem.
But a bigger issue is, we have 50% of this country who cannot get through a $500 emergency.
How do we fix that? Not sure if people aren't willing to save and/or can't. Not as simple as "get a better job".
For the people who can save and aren't willing to save we can tighten lending standards and regulate more. Outlaw payday lenders is a good start. Prevent credit cards from charging fees/crazy % of interest. Not allowing easy access to credit will help keep people from digging a hole for themselves. But the issue is still their spending behavior.
I don't get why this is even an issue or a discussion point. It's a false choice to pit the interest of the economy against health. Life cannot be saved no matter what amount of money you throw at it. The economy, we can always rebuild. We've done that before in our history. We can do it again. Life, liberty, and the pursuit of happiness won't mean much if you're dead.
In the meantime while we wait it out, we can float people's bills to keep food on the table and a roof over their head. That's all that's needed. I don't think anyone is arguing we have to wait until we have 0 cases to return to normalcy, but definitely not anytime soon.
We discuss it because we still can.
Economies don't always come back and there is no guarantee ours will bounce back after this. There is some serious economic sh$7 hitting the fan right now and we are in no way assured that our business and political leaders can and will get us out of it.
These shut downs were implemented to stagger the visits to hospitals. Now, we're on to waiting for a vaccine or sheltering in place because there might be a second wave in the fall. I heard the Gov of NY a week or so ago say something along the lines of "if it saves just one life." That's no way to make public policy.
As far as floating people's bills (I assume you mean the Feds sending everyone money, indefinitely) eventually those chicks will have to come home to roost some day and it will be ugly.
I'm in no way advocating that we all head down to the local tat parlor after getting a hair cut and our nails done. But some creativity is called for here. There are some signs of intelligent life with businesses (and institutions like the library) implementing some new ideas, but there's not enough to run cities and states that depend on commerce to function.
Economies don't always come back and there is no guarantee ours will bounce back after this. There is some serious economic sh$7 hitting the fan right now and we are in no way assured that our business and political leaders can and will get us out of it.
These shut downs were implemented to stagger the visits to hospitals. Now, we're on to waiting for a vaccine or sheltering in place because there might be a second wave in the fall. I heard the Gov of NY a week or so ago say something along the lines of "if it saves just one life." That's no way to make public policy.
As far as floating people's bills (I assume you mean the Feds sending everyone money, indefinitely) eventually those chicks will have to come home to roost some day and it will be ugly.
I'm in no way advocating that we all head down to the local tat parlor after getting a hair cut and our nails done. But some creativity is called for here. There are some signs of intelligent life with businesses (and institutions like the library) implementing some new ideas, but there's not enough to run cities and states that depend on commerce to function.
On your point about the economy "bouncing back". I'm not sure why you and other people think the economy will return to pre-lockdown state. It will never be the same. The fundamental issue with why people think there's "some serious economic sh$7" hitting the fan is because the US economy - both businesses and individuals have been running high on that credit train for a while now - we're talking about decades. Everyone has refused to save up a proper rainy day fund and trashed fiscal responsibility to trade for economic "growth". We've been so drunk off this "growth" we think it's normal. Businesses continue to spend money on shareholders and bonuses - while ignoring employee compensation and/or none essential spending without a rainy day fund built up. Individuals continue to spend lavishly and go deep into debt to sustain a unsustainable lifestyle where 50% of the country doesn't have $500 to their name and 70% don't have $1000 saved. Now we're told to stay home and stop spending temporarily - of course it's going to hit the fan - if you can't pay your bills you start cost cutting or going under. Now if you're going to build a rainy day fund, you will have to cut spending for a while - which does the opposite effect of economic growth. If this crisis doesn't teach people a lesson to save for a rainy day, I don't know how much more irresponsible we can be. I bet you most people on this forum do not have a proper rainy day fund (6 months of expenses+) saved up. "Proper" meaning - liquid cash savings not retirement - proportional to your cost of living and # of people under your roof for essentials only.
With regards to the actual bouncing back part. Well this all depends on spending habits in the economy. If we go straight back to how we were spending, then yes you'll see a similar "bounce back" of sorts, albeit it might be more tamed over time since we're opening stuff up in phases to attempt to restore consumer confidence. With regards to if it's possible to bounce back at all: the economy is built from human capital. We still have it even though as businesses go under. It's only a matter of flowing the money and capital to trigger a restart. If we get serious about saving for a rainy day, yes hard decisions will have to be made and you will see a very slow recovery. But that's the cost of doing so because of our reckless spending habits we've built up over decades. Now we're going to pay for it. This applies for everyone, individual, businesses, and governments.
Other factor that don't help the situation in the economy:
Our fractured healthcare system which access to largely depends on access to a job with benefits.
As for your point to floating checks and it crashing down. Well there isn't really any other option here because we have a pandemic. Because of the above situation I just described, that's the situation we put ourselves in during a real emergency. We dig into the national credit card as a result of it. Now I'm not saying we should do that indefinitely. I said, in the meantime while this crisis is going on we can temporarily do that to help people stay put. After we get through it this we'll have to do some real soul searching for a new fiscal mindset and pay down the national debt. We will have to raise taxes and we as citizens should expect taxes to go up and cannot whine about that.
As individuals, STOP spending money on credit - aside from homes and vehicles. Buying a washer and dryer on a Best Buy credit card is not acceptable, you should've planned for this way in advance.
STOP buying over the amount on big ticket items that you can really afford. Looking at you $50k income households with a $30k car and a $300k home. Just because you can qualify doesn't mean you should spend up to the limit. Buy a cheaper used car. Buy a cheaper and smaller house - if you can't move to a cheaper area or get a better job. Save for a rainy day by quarantining yourself until you do so. Everyone needs to have AT LEAST $15,000 in savings if you're single. Double that if you're a family of 4. More if you live in a higher COL area (Scottsdale, Paradise Valley, Tempe, Chandler, Gilbert, DT Phx). No whining and b@tchin, suck it up and save like your life depended on it.
All this doom and gloom in such a short period of time is really just a reflect of the childish financial behavior we as a society as sowed into ourselves in perpetuity and have made it a reality over time. Time to own up to that reality. This thread is just a demonstration of how far we've gone so far off the deep end to even suggest such a topic like this - a moral hazard baked into the economy on purpose because of our own recklessness.
It's a false choice to pit the interest of the economy against health.
You're right, and that's why this isn't a debate about economy vs. health. Instead, it's health vs. health. Economic crises kill people. They do it more slowly and more subtly than pandemics, but they do it nonetheless through mechanisms like suicide, stress, addiction, and abuse. The more intelligent debate then is which outcome costs more lives over the long run: Letting the pandemic run its course, doing everything to stop the pandemic regardless of the economic impact, or something in between that attempts to balance the two competing priorities.
You're right, and that's why this isn't a debate about economy vs. health. Instead, it's health vs. health. Economic crises kill people. They do it more slowly and more subtly than pandemics, but they do it nonetheless through mechanisms like suicide, stress, addiction, and abuse. The more intelligent debate then is which outcome costs more lives over the long run: Letting the pandemic run its course, doing everything to stop the pandemic regardless of the economic impact, or something in between that attempts to balance the two competing priorities.
Oh, don't fool yourself. The current debate is absolutely about the economy versus health. People who don't think they have a lot to lose (healthier and younger) are infinitely more interested in putting their self-interest above death. Not everyone: but most. They talk about suicide, stress, addiction to convince you (AND themselves) they are compassionate... It's people being vocal about controlling the narrative and opening up the country.
I will also say, there are a lot of people that should be worried about the health impact. Heck, they made the decision in their mind to "open up" without having a lick of data. Or their skewed "data" (before it was available) was busy quoting talking heads: 98% of which couldn't pass an 8th grade math test let alone understand the complexities of pandemic models (which I nor most everyone reading these words possess). I digress....
My point is, when people are against the ropes financially OR you are about to lose a massive amount of your perceived quality of life as defined by excess capitalism, you are going to error towards letting the chips fall where they may. And when you "pay off" the masses (some of which view it as "free" vacation), you get buy-in.
Oh, don't fool yourself. The current debate is absolutely about the economy versus health. People who don't think they have a lot to lose (healthier and younger) are infinitely more interested in putting their self-interest above death. Not everyone: but most. They talk about suicide, stress, addiction to convince you (AND themselves) they are compassionate... It's people being vocal about controlling the narrative and opening up the country.
I will also say, there are a lot of people that should be worried about the health impact. Heck, they made the decision in their mind to "open up" without having a lick of data. Or their skewed "data" (before it was available) was busy quoting talking heads: 98% of which couldn't pass an 8th grade math test let alone understand the complexities of pandemic models (which I nor most everyone reading these words possess). I digress....
My point is, when people are against the ropes financially OR you are about to lose a massive amount of your perceived quality of life as defined by excess capitalism, you are going to error towards letting the chips fall where they may. And when you "pay off" the masses (some of which view it as "free" vacation), you get buy-in.
Ding ding ding we have a winner! People have to make sure the news they receive they can keep the narrative straight. All media has some form of bias and all talk has some interest behind it for the most part.
Ding ding ding we have a winner! People have to make sure the news they receive they can keep the narrative straight. All media has some form of bias and all talk has some interest behind it for the most part.
Saying that.... Looking at the (way to) preliminary data, it's looking like opening up sooner than later makes a lot of sense! For ONE key reason: the financial risks are higher than the death toll. It's done EVERY day. My criticism is towards people whose POV was made weeks ago. They had no idea what was coming or who it was going to roll-out. Yet, they were sooooo smart. Meanwhile, the 98% of the entire world made a different decision to the social distance to extremes.
Setting aside the issue of human lives for the moment...
Looking at this purely from an economic point of view, is it more important to open up businesses immediately, or is it more important for the public to believe it's safe to be out and about before reopening? The answer is far from clear, IMO.
Setting aside the issue of human lives for the moment...
Looking at this purely from an economic point of view, is it more important to open up businesses immediately, or is it more important for the public to believe it's safe to be out and about before reopening? The answer is far from clear, IMO.
I don’t think it’s necessarily a choice between the two. Even if Governor Ducey allowed everything to reopen on May 1 (which I consider extraordinarily unlikely), fear of the disease has become so great that places will be slow to reopen and customers will be slow to return. I look forward to eating in my favorite restaurants, visiting museums to escape the summer heat, and taking the train to my office (even if I need to wear a mask while doing so). On the other hand, I know many people who are going to proceed at a more cautious pace and delay their return to previous routines. Some are motivated by concerns about their own risk factors, some by altruistic considerations of public health, and a few by an almost competitive impulse to see who can out-quarantine everyone else.
I think the economic question is more about which will be more harmful in the long run. Rushing to reopen, possibly causing cases to spike and returning to a longer, strict lockdown, or staying locked down now until deaths and new cases are clearly diminishing.
I think all the people screaming about reopening the state are failing to consider the greater economic harm that that may bring if not done so in a calculated fashion.
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