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 Simulus PlansThe Chinese government announced and put into effect a $586 billion stimulus plan in November 2008. That stimulus program appears to be working. Will the stimulus plan signed by President Obama this week have a similar effect or should the US have focused on a Beijing-like plan? |
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by Scott Rothbort
on Thu Feb 19, 2009 7:45 am |
 RE: Simulus PlansThe Stimulus Plan implemented by the Obama Administration can either significantly improve our nation's turmoils or invite the recession to stay around longer than expected. Although the plan is geared toward assisting housing foreclosures through the America's premier GSE's, Fannie Mae and Freddie Mac, the public needs to have some reassurance that this stimulus plan will help aid the ailing jobs and unemployment figures throughout the country. According to www.cia.gov, China's uneployment rate was around 4% in 2008. If this stimulus proves to be successful, the US should start to see some stimulated job growth in the short-term instead of more layoffs and higher unemployment rates. |
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by Andrew Mancini
on Thu Feb 19, 2009 2:08 pm |
RE: Simulus PlansChina and the United States come to the table from two different positions. China needs to increase spending by establishing a credit market for individuals which is totally against communist thinking. China also has the one child policy which will hurt their future if they have anything like Social Security.One child paying for two parents or work until you drop. China stimulus plans will only help China because the government controls all the institutions. In the United States, the government does not know whats going on with the economy. Mr. Markopolis is a perfect example. Government workers and politicians stealing from the public along with the bankers. I would like to know who Mr. Markpolis turned in to the SEC. Maybe Stanford Financial. At least in China the person who did something wrong would commit suicide. In the U.S.A.,it is Mr. Markpolis who fears for his life because he told the truth. This is sad situation. Any economic plan that rewards the people who got us into this situation will fail. President Bush 1 was right about supply side economics by calling it "Voodoo Economics" which is still the same dead horse the Republicans are pushing. America is 56 trillion dollars in debt with unfund mandates and promises and an unregulated CDS,CDO and structured finance market(house of cards) that has another estimated 50 trillion dollar but we do not know because it is an unregulated market. BAC(Bad Asset Corp.) and C(Crap) need to have Mr. Markpolis look at the books. Both countries have structural flaws in thinking that have to be corrected. I believe China has a better chance because the size of the stimulus plan to GDP and the corrupt leaders have committed suicide which will allow them time to rethink the one child policy. President Obama has a tougher task because he needs a Treasury Secretary who knows how to use Turbo Tax. We do not need Paulson 2.President Obama needs to have a talk with Mr. Buffett and follow his rules(work hard,work smart and do not lie).
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by
on Thu Feb 19, 2009 2:40 pm |
RE: Simulus PlansOn the quick glance of these two stimulus bills passed in two very different nations, the Chinese bill seems to be the better of the two compared with the one recently signed by Barrack Obama. The communist nation of China has more control over where money goes and directs that spending to areas that the government sees fit, such as building schools and buying debt from national banks; however, the bill passed by President Obama has loads of extensions by lobbyist and other bureaucratic factors that spend vastly on many projects instead of focusing on the specific area that needs to be fixed. If America has a problem of bad debt and bad mortgage securities and the government wants to fix it, should it then buy those bad securities and debt? The Chinese have control over those issues and act in the best of a nation where as the American government seems to be attempting to solve to many issues at once. I hope the bill passed will bring more good than harm, but with many clauses as "Buy American" may in the future hurt our economy instead of prospering it. Let the economy and the minds of "Wall Street" guide this economic turmoil, not the politicians that have very little experince on capital hill guide it. The Chinese know this and act percisely to resolve issues, which as of now seem to be working in their favor.
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by Thomas Klimek
on Thu Feb 19, 2009 3:22 pm |
RE: Stimulus PlansWhile I agree with member TK on the fact that China, being a more centralized economy, has greater control over where its funds are going, there is no doubt that it has issues of its own in that government corruption is much more prevalent there. Because of that, I see China's plan as somewhat on par with America's pork-filled plan in terms of the packages' overall effectiveness. As for each plan's focus, it is probably not an "apples-to-apples" comparison between the two plans due to major differences between the two nations. The United States, for instance, already possesses a mature infrastructure system (although more can always be done to modernize/expand areas such as the electrical grid, but the system in place is adequate for the time being); China, on the other hand, is woefully lacking in that regard throughout a large part of the country. Because of that, I believe that each country's plan will have a positive impact on their respective economies. The key determinant to the ultimate success of America's plan to emerge from this crisis, however, lies not in the stimulus plan but in rescuing its banking system - an endeavour that China does not itself have to embark on. On a side - but in my opinion extremely relevant - note, news of China's $15 billion loan to Rosneft and $19.5 billion investment in Rio Tinto are reflective of the fact that China is stimulating not only its own economy, but those of other nations as well (albeit with the goal of furthering its own agenda). In that vein, China would probably be looking to invest in American assets if not for the undoubtedly sour taste left in their mouth from the Unocal debacle. I look for China to not only be one of the first nations to emerge from this crisis, but to also emerge with dramatically more clout in the world arena; unfortunately, the same probably cannot be said for the United States.
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by Ming Chou
on Thu Feb 19, 2009 8:19 pm |
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