The Great Money Giveaway

The Governments of the world are pulling out all stops to make sure that economic growth comes back.

To accomplish this goal, the world is experiencing one of the most aggressive money giveaways of all time.

1. What is the point behind this giveaway?

2. Is it going to work?

3. Who is going to benefit from this giveaway? Who is going to get wealthy from this giveaway?

4. What is the best way to give all of this money away?

5. Sean Hannity asked the question recently, "What caused this mess anyway?"

One of my neighbors, who has been very successful financially, told me how to make a lot of money. He said in part, "If you want to make a lot of money, you have to stand in front of it."

Well, there is a lot of money being given away by the government. How will you and I benefit from the giveaway?

Here is my perspective on the answers to these questions:

1. What is the point behind this giveaway?

Answer: It means that you and I are safe, secure and happy. For that to occur in this world, it means that labor and capital need to work harmoniously for the benefit of all. It means that governments, corporations and individuals need to synergistically work in concert with each other. It means that everyone will be better off if we work well together.

2. Is it going to work?

Answer: Probably, but it is a function of labor having the confidence to work productively.

3. Who is going to benefit and get wealthy from this giveaway?

Answer: Whoever is in front of the money flow. I hope that the money gets down to the workers and consumers. That is the whole point of this exercise. Unfortunately, the reverse is happening to begin with. That is why the money giveaway is essential and important. The question now is whether or not those that are managing the giveaway will act responsibly, such that this money gets into the hands of laborers first, which will spend and consume that which they have worked to produce.

4. What is the best way to give all of this money away?

Answer: It should go to capital first and labor second. It should not go directly to consumers. Laborers should have a vested interest in the capital. They should be owners. There should be accountability by labor of management as this capital is put to work. Since public works projects are important to modernize the infrastructure of the country, all taxpayers should have a vested interest in the upkeep and welfare of the country's capital.

5. What caused this mess anyway?

Answer: There are a lot of reasons behind this question. Everyone has a share in the blame, since it is a macro problem and we are all a part of the macro equation. Here are my thoughts as to what caused this mess and what we can now do to mitigate it.
First, the current tax policy caused too much money to flow towards capital and not enough to flow towards labor and consumers.
Second, the tax policy, lax lending practices, a weak dollar and an easy monetary and fiscal policy following the terrorist attacks contributed to the inflation of hard assets; oil and real estate in particular. This caused asset inflation to escalate much quicker than wages, causing a huge imbalance with respect to earnings being able to support the asset inflation.

The current efforts by governments to stimulate the economies of the world should work. It may work very quickly. Hopefully everyone will go back to work and stand in front of the huge money flow, so that everyone will be better off.

And then we better follow Ronald Reagan's favorite scripture from the Bible:

2 Chronicles 7:14 If my people, which are called by my name, shall humble themselves, and pray, and seek my face, and turn from their wicked ways; then will I hear from heaven, and will forgive their sin, and will heal their land.