9% is the magic number this week.

If you haven’t heard why yet, let me explain. The market saw a 9% jump this week alone, which is phenomenal. This came shortly after the three major events that occurred this week. The first being General Motors saying they will not need another injection by the government. The second being four banks giving back bailout money. The third is because Bernard Maddoff is behind bars.

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The President Obama’s address is clear, he wants his new recovery bill passed quickly.

The President made some interesting key points worth considering.

“We need Government to intervene in the private sector.”

Yes, we do. The private sector has proven to be too greedy and not willing to be a team player in the crisis. Greed has still not toned down in certain industries and government is needed to break this habit that some wealthier corporations are not willing to let go of.

“We need to break this recession cycle we are in.”

No, we don’t. As we discussed in our previous articles, recession cycles are necessary to readjust the distribution of wealth between various markets and decrease fake inflation that is in existence. I am human and do realize that unemployment is up and that people/states are in dire need of funds, but we need to realize that breaking a necessary cycle will only prolong its duration and delay its impact.

“There will be full transparency to the money.”

I am 50/50 on this comment. I believe transparency exists in necessary ways, but the reality is that full transparency leads to problems. The media is outstanding at blowing news out of proportion as they are usually Republican or Democratic stations and are fully paid for by those parties. Reality is they will show you what they want, but we have no need to doubt Obama and his administration as they have not done wrong so far.

“Our Government relies strictly on consumer spending.”

It is true. Two thirds of our growth had to do with consumer spending, there lied the problem. Since the past 5 years were based on consumer spending, we are going through withdrawal as we cannot spend as much, because we don’t have credit as back up. Just like a drug addiction, we need withdrawal before we are cured.

“This is the worst economical crisis since the Great Depression.”

Yes, it is. But we will not go into another Great Depression as we are a global economy and are much more diversified than we were back in the old days. This is a deep recession, the crisis is real and is not going to go away overnight, it will require work on all our parts.

I have been receiving many request from folks regarding the new proposed stimulus package and its impact on the economy.

Many are worried about the impact of injecting another trillion dollars in the economy and the impact of inflation in the next 2 to 3 years.

Lets not waste anymore time and lets find out where the money is going…

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It seems as though many economists are saying that our country is at the verge of bankruptcy. The banking system is about to collapse and cause our nation to go under, taking other nations down with it.

I am not an economist, nor do I have all the answers or solutions to this problem, but I can say certain things because of some common sense that is factual.

By bailing out banks and the private sector, we are simply trowing money away, as we are simply delaying the inevitable.

Mistakes must be paid for by serious losses from those that put us here to begin with, and got rich while doing it.

Think of it in simple terms, the more money we spend that we don’t have the more we have to pay back, simply like when you get a car loan. You must pay back the money plus interest, the only difference is your car payments end after 5 years, this doesn’t. We have almost tripled the deficit of the country in less than a year in bailouts and stimulus packages. If we continue, we will go bankrupt and drag  other countries down with us.

In simple terms, if you borrow $100,000, and then put $100,000 in the bank, you have $100,000? Well, not really, you have no money. So the more money we borrow to survive without fixing the root cause of the problem, then we are simply delaying what is meant to happen but are going in debt while doing it. Taxpayers, you will pay for all these bailouts for as long as you live and these stimulus packages are not free money, they are simply an advance on your taxes.

The true cost of this will be more than double what you receive.