Interests rates on consumers loans are already at or near historic lows and cannot be pushed down much lower. It is believed that even if rates do get lower it is not going to generate any new activity It is not interest rates that have stopped economic activity from occurring, it is the widespread layoffs and home foreclosures that have left thousands of consumers unable to qualify for loans and lenders reluctant to take a risk on anyone except the safe borrowers.
Springfield, Ohio has been on of the hardest hit towns in Ohio by job losses and foreclosures. The Feds demands for goods and services could possibly stimulate job growth, but it's indirect method could take up to a year to fully work into the economy.
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I didn't know that Springfield, Ohio has been the hardest hit in job loss and foresclosures. Do you know why this is? It seems strange to me that it would be Springfield and not Dayton. I have just lived in this area for the last three years, and currently live in Cincinati, so maybe there is something about Springfield that I am unaware of??
ReplyDeleteI agree, it is not interest rates that is the problem. It is the lack of jobs. If you aren't working, then it hardly matters whether the interest rates on loans is attractive. You won't qualify for a loan with no job. People need money in their pockets in order to spend--and need to jobs to get that money. There are no quick solutions to the unemployment problem. It took us years to get into this situation and it may take years to get out.
ReplyDeleteI know that the economic experts all seem to have different theories about what is needed to jumpstart the economy, but I think the root of the problem is the lack of good-paying jobs.
ReplyDeleteI think it's easy for economists to say that we need less or more government involvement, but someone has to look at the great number of jobs lost to outsourcing. And people need to realize these jobs are not coming back--so we need to work hard to find new industries (such as green technology industries) that will provide people access to good-paying jobs which cannot be outsourced.
That is very true. Lack of jobs is the problem. It's good that the Federal Reserves is helping with making it easier to get loans, but it's sad that it is effortless due to our lack of jobs.
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