I know you have all heard about all the stimuluses for individuals and businesses during the COVID timeline between 2020- 2021. The total, according to The New York Times, was over $5 trillion. With that much money being injected into the economy, it’s hard to believe our Federal Reserve did not see that we would have an inflation problem.
The “stimuluses” were supposed to help Americans during the pandemic, especially when the country was shut down for COVID. There wasn’t a single cry from Americans for the government to give all these stimuluses. Quite frankly, whatever slight relief they may have provided pails in comparison to the economic fallout that we are seeing now as a result.
After the initial two-month shutdown, I personally believe that the only people who should have continued to receive the stimulus checks were people who caught COVID. The same labs that reported COVID cases to the state, could have had a simple questionnaire that would give people the option allow their statuses to be shared with the government for the stimuluses to be allocated to those individuals in the event of a positive COVID test—as opposed to giving everyone the stimuluses, which is what happened.
Politics played a part, but I believe both administrations failed us, starting with Trump hiring Jerome Powell and obviously not wanting the stock market to crash, which led to inter,est rates being kept low far longer than they should have been.
Now many argue that the stimuluses kept the market flourishing even during the pandemic when the market was in free fall between February to April of 2020 and that the announcement of these stimuluses rescued the Economy—but did they? The unfortunate reality is that we only put a band aid on the problem and Powell knew that these trillions of dollars would create a very negative impact on the economy and inevitably lead to inflation.
Biden didn’t make matters better by not hiring his own Federal Reserve Chairman, but because he knew that it was going to be a disaster and retaining Powell would allow him to say that Powell was not “his guy,” to distance himself from being blamed for the extreme inflation we’re dealing with now. Biden also continued the stimulus checks and rewarded people who were unemployed with wages on par with their typical employment—and that continued the labor shortage.
This made businesses have shorter hours and operate less efficiently, and some businesses closed for good as a direct result.
So, let’s get this straight, since the COVID crisis, our government did not want Americans suffering financially because of COVID, so more money was printed in June of 2020 than in the first two centuries of our history. They did this knowing that it would create inflation, and then at the time, Powell didn’t raise rates at all, not even a quarter of a point.
In March of 2022, the Federal Reserve somehow decided to start raising rates but not subtly. From March of 2022 to now, mortgage rates almost doubled from 3.8%- to as high as 7.3%. To put that in perspective, a $300,000 mortgage the payment with a 3.8% interest rate on just the principal and interest payment was $1,398. That same mortgage with a 7.3% interest rate now carries a monthly payment of $2,057. In other words, it is $659 higher PER MONTH. This is not even including your property taxes and insurance!
Our government created the mess by wanting to pay every person in the country that is making less than a household income of $150,000, a stimulus that a good percentage of the population qualified for.
Federal Reserve Chairman Jerome Powell said the Fed is ready to “bring some pain” to households and businesses. “These are the unfortunate costs of reducing inflation,” Powell said.
It is beyond my pay grade, since I am a registered Independent, but both parties are now responsible for pain worse than what COVID caused, and to add insult to injury, the Treasury misled millions of people by giving them their stimuluses. Now those people must chase their stimuluses through tax refunds.
It is highly unfair that we the people, must endure incompetence from the people that we elect in office. This is not a debate on left or right. This is a matter of right and wrong, and I am hoping that for once, we put our differences aside and demand accountability from our elected officials.
Do not fall for the banana in the tailpipe. The Fed hopes to misdirect from their mistakes with the trivial news cycle to distract us from the sabotage that the U.S. Government unleashed on us. We deserve better!
Mario Henry (www.housevisors.com), a former National Football League player, is a financial services professional with 18 years of experience in the industry and author of How to Hire Your House, an innovative guide on how to create a tax-free pension and sustain sufficient income through retirement. Mario also is a licensed insurance broker and a national motivational speaker. He was a wide receiver with the NFL’s New England Patriots and a scholarship football player at Rutgers University.
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