January 24, 2008

One Gold Coin for Every American Family

If American families are smart (and if they are able), they'll take that $1,200 check coming from the gubment and buy a single one-ounce American Eagle gold coin. Now that monetary policy and fiscal policy appear to be firing on all cylinders, it will probably be one of the easiest and best decisions they'll ever make - the only real question is whether or not $1,200 will be enough by the time the checks arrive in May.

Following on the heels of the Federal Reserve's three-quarter point cut in short-term interest rates on Tuesday, with another half-point cut scheduled for next week, Congress acted earlier today by completing work on a $150 billion economic bailout plan that will see checks of $1,200 or more arriving in the mailboxes of almost 120 million families.

Oh yeah, they're going to raise the loan limits for Fannie Mae and Freddie Mac too, so the gubment can shoulder more of the liability for the nation's floundering housing market - it's an election year, it all makes perfect sense.

According to this AP report, now that the Dems are large and in charge, almost 30 percent of the tax rebates will actually go to people who do not pay taxes. Non-taxpayers will get $300 and those individuals who actually do pay income taxes will get up to $600, working couples will get $1,200, and families with children will receive an additional $300 per child under the plan.

It's not clear why they continue to call them "rebate checks" since, in many cases, it is nothing more than a give-away - almost like money falling from the sky.

Business tax incentives worth $50 million round out the plan that disappointed more than a few elected officials because it did not include an extension of unemployment benefits or an increase in food stamps.

Nancy Pelosi, D-Calif., agreed to drop both of these elements from the plan in exchange for getting checks of $300 into the hands of people who don't pay taxes.

"I can't say that I'm totally pleased with the package, but I do know that it will help stimulate the economy. But if it does not, then there will be more to come," Pelosi said.

That's good to know.

Once again, if you are able and if the gubment bailout money still covers the cost when your check arrives, just buy one ounce of gold, stick it away in a sock drawer and forget about it.

Someday, years from now, pull it out and tell your friends, "This is the gold coin I bought with that first government bailout check in 2008. It's worth [fill in the blank] now."