Summer's Coming America

Wall Street didn't get the message that we are in recovery. Despite President Obama's signing of the Stimulus bill yesterday, stocks continued to tumble and word is that the global recession is still in effect and may just have to run its course.

Apparently, investors around the world still do not have any faith just yet that America is back in business again. Probably, because it's not. Ailing banks, nearly bankrupt auto makers, tumbling home prices/values, and broke desperate individuals (like myself) who are watching every dollar and not so apt to spend anything right now are the reasons why they don't have faith and the reasons why, stimulus bill or not, nothing is going to change just yet.

General Motors and Chrysler had the nerve to ask for another bailout. General Motors says it needs $16.6 billion more in taxpayer money to survive. Chrysler is requesting an additional $5 billion and says it will cut 3,000 more jobs. (What did they do with the money they were already given?) As I said, we are still in a recession and there might not be any signs of a light at the end of this tunnel until the middle of the summer.

One thing economists fear is rapid deflation or falling prices. On the surface, falling prices look good for you and I but, if they continue to fall, that leads to lower wages due to lower profits and companies will wind up slashing their capital investments, which ultimately leads to more layoffs and brings us right back to where we started.

The positives about yesterday's Stimulus bill are tax breaks for families that send a child to college, possibly $13.00 more in your paycheck starting in June, couples will receive $800.00 back in their income tax returns, a $1,000 a child tax credit for low income families, and an $8,000 tax credit for first time homeowners.

If you have lost your job and subsequently lost your healthcare too, it will now be cheaper to hold on to that coverage while you're looking for your next gig.

For the first time in years, that pothole on a stretch of bad highway or road that broke your axle or realigned your car for you will be repaved. The steel on that bridge will be reinforced, and a new school might be built right over that bridge for your children to go to. If your kid is going to college, you or your child will be eligible for up to $2,500 to help pay tuition and related expenses in the fall of 2009 and spring of 2010.

Finally, all green things like energy efficient windows, furnaces, etc. will make you eligible for a 30% tax credit towards the cost of the materials.

Good stuff, huh? Well, here is the bad. The National Debt will still be high... over a trillion dollars. Like it or not, your children and grandchildren will be footing the cost of the Stimulus bill regardless of whether it jumpstarts the American economy or not. The saddest thing of all is that America, who used to lend everybody money, will now be forced to borrow money from China and other countries.

This recession is like war... easy to get into and hard as hell to get out of... and our futures will continue to tumble like tumbling dice within it. It's still winter in America but, buck up... summer's coming. Ronald Reagan told me so.