Bail Out the Tax Payer - Would it Work?
We read a market letter from one of these PH.D chart the market types. He has an idea to stop the slide in our economy dead in its tracks. Instead of injecting capital into big business(banks, auto, and home builders, and anyone else?) hoping that it will trickle down to the consumer. We should inject capital directly into the american taxpayer balance sheet by giving a 7-10 year income tax refund. Yes, a refund of all income taxes paid for the past 7-10 years putting possibly 100s of thousands in the hands of american taxpayer. Cost you say? roughly 8-10 trillion(we’ve already commited 7 trillion via leverage) with no real impact. This would immediately halt foreclosures in there tracks and it would put down payments in the hands of thousands of people who have good income but couldn’t save for a downpayment. Consumers would pay credit card bills off immediately and banks wouldn’t need capital infusions because any of these refunds not used to pay down debt(which would be mandated)would be flowing back to banks as deposits. The consumer would be free from the large debt avalanche hanging over their head. You would be firming up the american tax payers balance sheet and hope that the dollars trickle up to big business instead of down. The idea is getting some grass roots support…I know it’ll never happen…but would it work?