Government Leaders Turn to Economic Package to Jump-Start Economy

[Feb 19, 2008.]

You may have heard about the economic stimulus package being signed by the President. However, you still may be in the dark about what the package contains.

The legislation would place a $300 check into the pockets of nearly every American. That would include those at the bottom rungs of the economic ladder. Those who receive Social Security benefits, as well as those who receive disabled veterans benefits, would also receive $300, provided they earned at least $3,000 in 2007. Meanwhile, those who pay income taxes could achieve rebates of as much as $600 per person and $1,200 per couple. Those with children will receive $300 per child.

Still, the rebates would be limited to those earning $75,000 or less and couples earning $150,000 or less.
Businesses would receive more generous expense allowances in the hopes that they will prompt a tidal wave of investment. Homeowners will also be receiving a bonus - those with subprime mortgages will have an easier time refinancing. It should also be easier for families to buy homes, thanks to a boost in Fannie Mae and Freddie Mac loans.

The housing market is currently experiencing its worst slump in some 16 years. The problems began in the subprime loan market, where foreclosures have become epidemic. As a result, the housing crisis and the fragility of the overall economy have become key issues in this year's Presidential race. Many Americans say they will choose their candidate for the White House based upon that individual's stand on economic issues.

Meanwhile, the Federal Reserve is expected to enact additional rate cuts in an effort to breathe new life into the economy. Forecasters predict the housing crisis will continue until at least the middle of this year - maybe longer. In fact, some real estate experts do not expect a full recovery until the year 2010.

Julie Ann Amos
Febraury 19th 2008

Recent News

• Homebuyers in High-Priced Markets Could Get Relief
  Prospective homebuyers in high-priced real estate markets could receive some additional relief, courtesy of the federal government. [15th February 2008]


• Newspaper Says Current Measures Aren’t Enough to Solve Housing Mess
  The San Jose Mercury News newspaper has published an editorial saying that current government efforts to solve the nation’s housing crisis simply won’t get the job done. [15th February 2008]


• Rates on 30-Year Mortgages are Climbing
  The giant mortgage company known as Freddie Mac is reporting that rates on 30-year mortgages have increased to their highest level in 5 weeks. The rates now average 5.72%, which is up from 5.67% the previous week. [14th February 2008]


• Credit Card Companies Hold Consumers Responsible
  Some public officials have been saying that credit card companies lure consumers into a debt trap that is difficult to escape. They say that the credit card issuers are being irresponsible in the manner in which they peddle credit.


• Fannie Mae and Freddie Mac Offer Assistance During Housing Crisis
  The White House recently agreed to temporarily extend the size of mortgages Fannie Mae and Freddie Mac can buy, from $417,000 to almost twice that amount. [10th February 2008]


• Treasury Department Plan May Offer Limited Aid
  There are growing indications that the homeowner bailout plan offered by the U.S. Treasury Department may have a limited effect. [7th February 2008]


• Credit Card Debt Can Be Bad for Your Financial Health
  Many Americans carry thousands of dollars in credit card debt. Indeed, some turn to credit cards to finance their lifestyles when they are struggling with student loans, adjustable rate home mortgages, and other debts.


• Minorities Targeted for Subprime Loans
  The National Community Reinvestment Coalition recently studied mortgage information from 100 metropolitan areas in the U.S. Some observers say the results have been quite shocking. [3rd February 2008]