Stimulus Checks are Coming!

Chances are you may have your stimulus check already. While I don't want to get into the finer points of this type of political pandering - especially considering most economists think it will do nothing toward "stimulating" the economy - it is nice to note, coincidentally, that this week were released some sober figures by our very generous government.

Not all governmental reports are created equal, and this one was certainly swept under the rug. According to Uncle Sam, Americans have just posted their worst first quarter personal savings figures since the GREAT DEPRESSION. The average family's savings rate is now at .2% of disposable income (after taxes).

Here's a lovely graph I am borrowing from the Wall Street Journal. (I'll give it back at an as yet undetermined time.)

That means that of every $1,000 of disposable income, Americans are saving $2. And while this may seem dire, many other figures actually point to a negative savings rate - or spending more than we make.

The amazing thing is the implied message from Bush, Congress, et al, is that we should run out and spend our "free" money. The last thing they want, politically, is for us to save it. So here is my very rare request for civil disobedience: save it. Or better yet, pay off debt - credit cards are always first.

Remember my inflammatory post on food prices? I read an article the other day on food as an investment. That is to say, you could get a better "return" on your money by stockpiling food now than you would with that money in a normal checking or savings account accruing up to 3% interest annually. With food prices expected to jump upwards of 10%, which is the better deal? Yes, this is apples and oranges, but the point remains said - especially when viewed as food storage.

So, with food and gas prices soaring and personal incomes stagnant, what are you doing to trim costs? (Note that I'm not even referring to saving money as these higher prices mean that other expenses must be reduced without cutting into savings or incurring debt.)

For us, entertainment is the first to go, followed by eating out. We haven't done an in-depth analysis of April's budget yet, so we'll see what needs to go next.