Now that the $787 billion stimulus bill has been signed, the President is now pushing for a $275 billion housing bailout bill. In addition there is talk of a secondary (which would be the third counting Bush’s) stimulus bill. I didn’t agree with the first one by Bush and I don’t think that these will be good in the long term. With the huge amounts of cash that will be printed by the Treasury, you can expect a very high level of inflation in the coming years (9-18 months out). On top of that, don’t expect the stock market (which is tanking in the lower 7000 range) to improve dramatically anytime soon. This isn’t a reason to cower in fear, but it is a wake up call to get our individual financial matters in order. Getting cash flow in hand is job one.

So why is the stimulus not going to work? It will not work effectively because it throws money at the problem. It spends money for the sake of spending without targeting growth areas. On top of that, it should have been based around tax breaks instead of spending. Tax breaks put money into the hands of those that increase the GDP instead of money in the hands of those that drag down the GDP. It may not be the feel good thing, but it is the economically sound thing. All those corporations that the national Democrats demonized during the Bush years are the ones that employ people. It would seem that we are finding out what happens when they don’t make those profits. It will not be pretty.

On the political front, we’ve had our vote. President Obama and the Democrats have the reigns in guiding the economy. This is their ship now and I’m getting my lifeboat ready. I sincerely hope that I’m wrong, but I’ll hope for the best while planning for the worst.