Prime Rate Credit

Well, the last person you want to hear admit that the economy forecast doesn’t look so hot is a politician - namely the president. And President Bush has recently stated that he admits the economic forecast, based on the information we have now, isn’t looking too hot. He’s even proposed the now well known package which include rebates in the several hundred dollar range to workers in the US to try to stimulate the economy out of its doldrums, which has many businesses and individuals suffering unfortunately.

The economy is, has been, and always will be cyclical in nature, meaning that it will go through ups and downs, and we won’t always have the rosiest outlook on how things are running money wise in this country, that’s just a fact of life. However, I do think that the media’s role in inducing panic and near hysteria has taken a turn for the worse, and is partly to blame for the faltering economy, as much as any job rates and interest rates or subprime mortgage issues has.

What I mean is, I wish the media would be a bit more responsible on reporting things like speculation about recessions. It’s hard not to panic when every day you see headlines that seem to over exaggerate what’s really going to happen, or say things that aren’t true and may not come true on pure speculation from people who don’t know for sure what’s going to happen any better than I do.

The Fed though, has responded to this outpouring of concern about the economy and what direction it is headed by cutting key interest rates several percentage points, or at least fractions of percentage points, in efforts to try to stimulate the economy and make consumers “consume” more by giving higher chances of them getting low fixed APR rates rather than higher variable rates on loans and mortgages. Many think this is only a very temporary bandaid though, which I happen to agree with, and some even go as far as to say that they believe the government should just stay out of economic issues.

I’m not sure if I believe that, but I’m also not sure that a tax rebate should be done either, as it’s not clear where this money is actually going to come from. Hopefully Bush will have better news about the economy than saying that there are “troubling signs” ahead or at present. Could this potentially make things worse in the long run? Thoughts?