The Rich Have Stopped Spending And That Has Tanked The Economy

[scorpioncapital]

There is great inequality in EU too. Depending where you are. Some countries have decided to tax labour 90% and capital 10%, actually 10% is generous, some have no capital gains tax and sub 15% flat passive income taxes.

[Spekulatius]

 

 

Well, let's hope they don't, or at least go ahead with the massive infrastructure projects.

 

In addition, some of this trickle-up surely had some positive impact on small businesses which would then support households, and so on.

 

I think the burn rate on stimulus is currently $1T every 5 weeks or so. A $1T infrastructure bill that takes years to work off is in monthly terms so much less that it hardly makes up for CARES. It’s still a good idea, but it will hardly make a dent except in certain industries.

[meiroy]

 

 

Well, let's hope they don't, or at least go ahead with the massive infrastructure projects.

 

In addition, some of this trickle-up surely had some positive impact on small businesses which would then support households, and so on.

 

I think the burn rate on stimulus is currently $1T every 5 weeks or so. A $1T infrastructure bill that takes years to work off is in monthly terms so much less that it hardly makes up for CARES. It’s still a good idea, but it will hardly make a dent except in certain industries.

 

When there is a real economic need for certain infrastructure, then the new inf. or improved inf. will have a positive economic impact beyond those (companies/individuals) that received the money to construct it.  As far as numbers go, that's the big question, how far will they go... something is better than nothing.  If it bothers people so much that "people get money for nothing", you can always have people dig ditches then fill 'em back up ;) (edit: apparently it's holes, not ditches. sounds better. too)

 

 

edit 2:

https://econ.economicshelp.org/2008/07/john-maynard-keynes-great-economists.html#:~:text=Keynes%20described%20this%20as%20economic,and%20actively%20stimulate%20the%20economy.&text=%22The%20government%20should%20pay%20people,and%20then%20fill%20them%20up.%22

 

"Keynes and Great Depression

It was during the 1930s, that Keynes' really made his mark as an economist, helping to develop a whole new branch of Economics.

 

When the Great Depression hit, with unprecedented ferocity, economists were at a loss to explain its causes and how to overcome it. Prevailing economic orthodoxy stuck to the old classical view that Markets will clear in the long run. At the height of the crisis, the fledgling Labour government was told by Treasury officials that the government must balance the budget to survive the depression. This effectively meant increasing taxes and cutting unemployment benefits. Keynes described this as economic madness and argued for the exact opposite. He argued in a recession of this magnitude, it was necessary for the government to intervene and actively stimulate the economy. Apart from a few half hearted attempts such as the new deal, Keynes' policies were largely ignored in the UK and US; and high levels of unemployment persisted until the start of the second world war."