It seems like these financial posts will still continue for the near future. So much is hinging on the financial bailout, that most American's do not even consider or are un-aware of the consciences. Cause if they did, widespread panic would probably ensue. I think that is why Paulson and Bernanke are having a hard time persuading Congress into this plan. They have to walk a fine line to not cause widespread panic among Americans, but also not to lessen the seriousness of the problem!
I am for the bailout, because if we don't do this we will definelty be in a depression that will rival the Great Depression, and maybe even trump it...if that is possible!
The banks won't be able to loan money for college, small businesses, local farmers, or just about any loan you can think of. Businesses will have to cut jobs due to nobody spending money (cause they aren't getting money or loans). With people not having jobs...people will default on their home loans...become homeless or have to work 2-3 jobs just to stay afloat. The trickle down effect...
But I also see that doing this bailout, we are also just delaying the inevitable. I hate to be so pessimistic, but no ecomony cannot continue to increase indefinetly. It is just not possible. There has to be a correction at somepoint...a downturn. It is just depends on how big a correction you want!
Unfortunetly, taxpayers will be hurt no matter what they decide, cause if they do go ahead with the bailout...the money will have to come from somewhere....the Fed will just print more money...which will increase inflation...hurting the average Joe's purchasing power of the dollar bills they have in their pocket!
Plus if we continue to increase the national debt and continue to print money non-stop, we will enter a financial crisis called hyperinflation...which means the American dollar will be absolutely worthless. YES....WORTHLESS! Can you imagine a scenario where you have 1000% inflation everyday? I have been reading some literature on this...and from what I can see, is that it is inevitable...it will come to pass. We just don't know when, but most people think it will be in our lifetime.
So what can we do to prepare for a depression? Well here are some suggestions..... (I dont know how many people are really reading this though...)
1. Pray (cause God is bigger and more powerful than our economy mess!)
2. Create an emergency savings fund of atleast 6 months (the more the merrier) in case you loose your job in a place that you can access very quickly likes savings or checking account.
3. Pay off any outstanding debt with high interest (especially credit cards!) as soon as possible.
4. Don't take out any big loans (especially if you dont have a savings fund or have a iffy job)
5. Create a budget and live within your means (dont spend more than you earn!)
6. Be as diversified as possible!
7. Continue to pray and don't forget to continue to tithe.
Now, I think they will pass this bailout, and will probably prevent a depression at this point. But, you never know if it will work or be enough or when the next crisis will come....so even if they pass this bill...people need to be working on being good stewards of the money God has entrusted to you (which I am sure most people are doing).
Wednesday, September 24, 2008