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Isn’t this the exact opposite of what we want? If a stimulus results in decreased spending we are literally just flooding the market with dollars that are being

Isn’t this the exact opposite of what we want? If a stimulus results in decreased spending we are literally just flooding the market with dollars that are being saved. If that money isn’t being spent it isn’t triggering the desired effect of a stimulus package... creation of goods and services. It’s basically just a big middle finger to people who don’t take on debt and who are still working, especially service workers. If they announce an extension of the bonus unemployment I will definitely ask to be laid off, 3 months of making $4500 a month with infinite free time to pursue side projects?

triyambakam 6y ago
So could a couple make $9000 a month, or more with children?
- ericmcer 6y ago
  If a couple both got laid off in late March and filed for unemployment they would have made 4200 + 4200 + 1200 + 1200 = 10800
  - thephyber 6y ago
    > filed for unemployment I would like to point out that filing for unemployment is risky: - it's not a guaranteed approval, - you don't automatically get health insurance (and COBRA moves all of the cost to you, rather than split between employer+employee), - there's little hope of a bonus extension, and - there's a chance that your state exhausts their unemployment fund in the near future.
burlesona 6y ago
It’s very likely that the majority of that cash is being used to pay rent and pay off credit cards, while a percentage is being held as cushion for the very uncertain near future. You can get angry about it, but I don’t know how productive that is when the majority of this money was sent in equal payments to everyone below a fairly generous cutoff level. Lastly, it’s hard to see a stimulus effect in consumer spending when stores are closed and there are supply side constraints. The truth is most households spend almost exactly as much as they make every month, and the fear of the virus combined with the lockdowns basically blew a gaping hole in many people’s income with no easy way to fix it. The cash transfers are basically the government applying pressure to that wound to prevent it bleeding out. It buys some time. Whether or not we’ve used that time well and are prepared to handle what comes next is a very different question.
dx87 6y ago
It could also be that the extended benefits were a way to keep low income people content. At least where I live, most of the layoffs have been minimum wage positions, like wait staff, sales associates, etc. Even if they aren't spending the stimulus money, it could at least help them feel safe, reducing the chance for civil unrest.
novaRom 6y ago
You may enjoy those 3 months, but then? Chances to find a stable job in a shrinking economy?
thephyber 6y ago
> isn’t triggering the desired effect of a stimulus package That's why Congress people were careful not to call it a stimulus. The payment was to pay people to stay home safely without (hopefully) losing their livelihood. It wasn't about stimulating demand for the economy. Yes, there are worries about deflation if consumers don't spend like they did before (although consumer spending in the USA has been out of control for too long).
thephyber 6y ago
> If they announce an extension of the bonus unemployment I will definitely ask to be laid off I was talking with an expat friend of mine that lives in APAC. He was considering moving back stateside if he got laid off, but he calculated the cost of healthcare and realized it was like taking a 30% pay cut. Remember to calculate the cost of health care (or health insurance) before you take that action. Also, there's no guarantee your state will still have a non-empty Unemployment or MedicAid fund in the future. Remember that state revenues drop as employment and consumption drop.
rectang 6y ago
Employment is in freefall! The countermeasures deployed are pretty much what we want. Considering the uncertainty that the population has to grapple with along with the loss of benefits, it's probably better to err on the side of providing slightly higher assistance by some stats — which is where we're at. But in any case precise calibration of the assistance package is an unrealistic goal.
throw0101a 6y ago
> Isn’t this the exact opposite of what we want? If a stimulus results in […] As both Bernanke and Krugman have observed, what has been implemented to date is not stimulus but disaster relief. The economy has been put into a coma on purpose, and the money is not to get it going, but to allow people to survive in the short term (rent, food). Once the lockdown(s) are eased off, then a stimulus may be needed to get things rev'ing again.

triyambakam 6y ago

So could a couple make $9000 a month, or more with children?

ericmcer 6y ago
If a couple both got laid off in late March and filed for unemployment they would have made 4200 + 4200 + 1200 + 1200 = 10800
- thephyber 6y ago
  > filed for unemployment I would like to point out that filing for unemployment is risky: - it's not a guaranteed approval, - you don't automatically get health insurance (and COBRA moves all of the cost to you, rather than split between employer+employee), - there's little hope of a bonus extension, and - there's a chance that your state exhausts their unemployment fund in the near future.

burlesona 6y ago

It’s very likely that the majority of that cash is being used to pay rent and pay off credit cards, while a percentage is being held as cushion for the very uncertain near future. You can get angry about it, but I don’t know how productive that is when the majority of this money was sent in equal payments to everyone below a fairly generous cutoff level. Lastly, it’s hard to see a stimulus effect in consumer spending when stores are closed and there are supply side constraints. The truth is most households spend almost exactly as much as they make every month, and the fear of the virus combined with the lockdowns basically blew a gaping hole in many people’s income with no easy way to fix it. The cash transfers are basically the government applying pressure to that wound to prevent it bleeding out. It buys some time. Whether or not we’ve used that time well and are prepared to handle what comes next is a very different question.

dx87 6y ago

It could also be that the extended benefits were a way to keep low income people content. At least where I live, most of the layoffs have been minimum wage positions, like wait staff, sales associates, etc. Even if they aren't spending the stimulus money, it could at least help them feel safe, reducing the chance for civil unrest.

novaRom 6y ago

You may enjoy those 3 months, but then? Chances to find a stable job in a shrinking economy?

thephyber 6y ago

> isn’t triggering the desired effect of a stimulus package That's why Congress people were careful not to call it a stimulus. The payment was to pay people to stay home safely without (hopefully) losing their livelihood. It wasn't about stimulating demand for the economy. Yes, there are worries about deflation if consumers don't spend like they did before (although consumer spending in the USA has been out of control for too long).

thephyber 6y ago

> If they announce an extension of the bonus unemployment I will definitely ask to be laid off I was talking with an expat friend of mine that lives in APAC. He was considering moving back stateside if he got laid off, but he calculated the cost of healthcare and realized it was like taking a 30% pay cut. Remember to calculate the cost of health care (or health insurance) before you take that action. Also, there's no guarantee your state will still have a non-empty Unemployment or MedicAid fund in the future. Remember that state revenues drop as employment and consumption drop.

rectang 6y ago

Employment is in freefall! The countermeasures deployed are pretty much what we want. Considering the uncertainty that the population has to grapple with along with the loss of benefits, it's probably better to err on the side of providing slightly higher assistance by some stats — which is where we're at. But in any case precise calibration of the assistance package is an unrealistic goal.

throw0101a 6y ago

> Isn’t this the exact opposite of what we want? If a stimulus results in […] As both Bernanke and Krugman have observed, what has been implemented to date is not stimulus but disaster relief. The economy has been put into a coma on purpose, and the money is not to get it going, but to allow people to survive in the short term (rent, food). Once the lockdown(s) are eased off, then a stimulus may be needed to get things rev'ing again.