| Kasz216 said: The side that points out that avoiding a recession doesn't actually mean anything...? You avoid the technial term of a recession but that doesn't actually improve anyhing. You can increase your GDP 1 million fold if you decide to borrow 1 million times your GDP and spend it on a shiny coin. That's not actually helping the fundamentals of your economy however. You need to look at things with deeper attention to fundamentals. It's the same reason why the unemployment number we always see used is flawed because it doesn't take into account participation rate.
There is plenty of merit in having stimulus to help people out who are hit hard by the recession, but it'd be a mistake to think it's actually going to help anything economically.
Which is why all stimulus funds should be dedicated soley at relief towards the poor. Any money not directly spent that way and used for "stimulting buisnsesses sales" are pretty worthless because it just further distorts the market. |
The state of an economy could have external factors driving it down. As we see with many recessions, it becomes a massive chain reaction. Economies are always inflated with speculation and bubbles. All it takes is a few outside influences to destabilise it. The point of stimulating to avoid a recession is probably for a more broader sense, attempting to stop the after effects, like if somebody took a supporting pillar from a building.
Stimulus should help the poor, but that in turn does provide some degree of stability, since that stimulus goes into the economy where an otherwise growing hole would be. It wouldn't be long-term beneficial, but it would stop negative speculation and a declining economy from working in tandem to make the problems worse.
If I remember correctly, didn't the US spend it's stimulus all on the banks? Was this just to bail them out, or was this to try and kickstart the economy again? If it was the latter, it probably might have done better in the hands of consumers.
On a side note, wouldn't some public service jobs be considered stimulus? Think about it....at least the government is getting some degree of work in return...
