Stimulating Our Economy

I took a minute from working on my finals to drop a couple EC's and came across a post about our economy. Being an entrepreneur myself, it really resonated with me and I felt the need to blog about it.

The issue of what needs done to best stimulate our economy is brought up as putting the stimulus money to use by allowing small businesses and entrepreneurs the chance to prosper rather than throwing it into a welfare pool. There were parts I agreed with and parts I didn't, but it definitely got me thinking.

Finances are an important part of our daily existence and are a huge part of what makes our culture work, and I get very passionate about it. I'm definitely of the opinion that we need to keep the markets moving in a forward manner. Letting them stall is only going to hurt us more in the long run.

Banks have received their bailout...so why aren't they doing more to help it along? I understand that their role in our downward slide may make them iffy, but when will they realize that it's not giving the loans that did them in...it was giving them out stupidly. Nudging people (or out and out conning them, in some cases) toward loans they couldn't afford without a crazy adjustable interest rate was asking for trouble. Of course they got caught up when the rates spiked! That's what happens when people get used to paying one amount and suddenly have to pay another, way more expensive.

I'll never call myself a finance expert (I'm no more than an adult interested in doing as well as I can with what I have), but even I knew those adjustable rates were a terrible idea when I heard about them. It wouldn't be that bad as long as the people taking them out stayed aware of how much it could spike and prepared themselves. Most didn't. Still, having one steady payment throughout the life of the loan with all cards on the table is just a more logical way to go.

I've heard it said that we should go back to the system that was up in the 50's...approving loans for those who could actually afford to pay them off and had conservatively saved for a good down payment (in the case of cars and houses). Some things I am glad we've moved forward from, but that's one I agree with going backward on. We, as a nation, really need to learn to manage our money better. It's a tough way to have to learn that lesson, but we'll be the better for having to.

Ranting about money is one thing that motivated me to join the Suze Orman Fan Community Blog as a contributor. She's very passionate about being frugal and I like that in a celebrity :)