How do you stimulate the economy?

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How do you stimulate the economy?

2020 Mar 11, 10:40am 4,054 views 22 comments

Cutting rates or taxes won't make people go to the restaurant, go see a movie, go for a massage, or take a plane... if they are afraid to catch a virus.

You could do a bit of infrastructure works, but are cooks gonna do it?

The part of the economy that is hit is precisely the part that would normally be hit last in a recession.

And you can't really fight a virus without hurting that service economy.

But keep in mind: if you fail to stimulate the economy, the bubble everything economy could pop, and the world plunge into a deflationary spiral that would be devastating.

So what do you do? Send people money?

https://www.bloomberg.com/opinion/articles/2020-03-10/a-coronavirus-recession-will-be-tricky-to-fight
https://www.bloomberg.com/opinion/articles/2020-03-10/u-s-treasuries-are-not-supposed-to-trade-like-this
https://www.bloomberg.com/news/videos/2020-03-11/trump-is-a-no-show-after-promise-of-economic-plan-details-video

Comments 1 - 11 of 22 Next » Last » Search these comments

RWSGFY @ 2020 Mar 11, 10:50am

Heraclitusstudent says

So what do you do? Send people money?

But what would they spend it on while sitting in quarantine? Netflix?

Tenpoundbass @ 2020 Mar 11, 12:43pm

You got to rub its Nipples.

3 EBGuy @ 2020 Mar 11, 4:08pm

The trout will love this:
Imagine a bank that pays negative interest. In this upside-down world, savers are penalized and borrowers get paid to borrow money...
By mid-2019, the pile of negative-yielding bonds topped $17 trillion, or a quarter of all investment-grade debt, increasing the focus on how citizens are hurt when their retirement savings fail to grow.

Booger @ 2020 Mar 11, 4:10pm

The_Weeping_Ayatollah says

But what would they spend it on while sitting in quarantine? Netflix?

Rent/mortgage, utilities, online orders. Plus the stores will still be open, except that lines might be less.

Heraclitusstudent @ 2020 Mar 17, 11:54am

"White House Wants to Send Individual $1,000 Stimulus Checks Now"
https://www.bloomberg.com/news/articles/2020-03-17/mnuchin-says-trump-wants-money-sent-to-americans-in-two-weeks

$1000. To people stuck at home. Lol!

RWSGFY @ 2020 Mar 17, 11:59am

Heraclitusstudent says

"White House Wants to Send Individual $1,000 Stimulus Checks Now"
https://www.bloomberg.com/news/articles/2020-03-17/mnuchin-says-trump-wants-money-sent-to-americans-in-two-weeks

$1000. To people stuck at home. Lol!

It's not like the bills stop coming if you're stuck at home....