March 13, 2009 Source: (ECrews)

Important Thoughts:  Financial rescue plans, Obama and you.

We have all heard the news about President Obama’s plan to rescue our economy and the way he plans to accomplish his goal.  To most readers, his plan is extremely overwhelming and inconclusive.  However, the fact of the matter only arises several questions about the rescue plan.

• Does he know what is doing?
• Is he selling out?
• Does he have enough experience in order to prevent an economic broken future?

Let’s simulate President Obama’s rescue plan into a real life Homeconomics approach to solve your personal deficit. Currently, most Americans are suffering from credit card debt and mortgage delinquencies due to the domino affect of the mortgage melt-down crisis. The solution to this problem can be corrected by several ways such as filing for chapter 7, or 13 Bankruptcy, using a debt consolidation company to consolidate and lower the interest rate or simply to borrow money from a financial institution or family member

to pay the debt off over time.  This allows the person to get back on track to save more money or increase their wealth in other assets. I know what you are thinking, “why is it that in order to get out of debt, you must borrow more money?”  The answer is LIQUIDITY!

Now, the scenario we just discussed paints the economic state of Americans in general, but we can expand the principles of this scenario and apply it to the Nation as a whole.  We would move from what I like to call as “Homeconomics” to “Nationonmics”. 

In plain and simple words, the solution to change our current economic disaster is to create liquidity. In order to create this healthy liquidity we would have to borrow trillions of dollars and eventually pay it off over time.  Now, the only way to pay this debt off would be to increase taxes.

Taxes! Who’s going to pay for this? And this is where the concern lies! Many of us do not understand our Nation’s economic infrastructure, but pay close attention to what I am about to say and it will all make sense.

The conservative approach is for the working class to pay the debt back, while the liberal approach is for the middle class and wealthy to pay the debt.  This is something you perhaps did not know.  Now, this is where it gets interesting.

The current liberal party is allowing the middle and upper class to pay for the proposed tax increase.  This class is whom we know of as the small business and fortune 500 corporation owners.  They need the working population to purchase their products, whether they are by necessity or desire.  When money is injected into our economy, through tax credits, it begins to flow into the hands of the working class.  This in turn increases their buying power, whom eventually spend the money into the small businesses and fortune 500 corporations.  Supply and demand kick in at this point.  With more money flowing in our society, prices increase due to the limited amount of supply and the ever increasing demand.  The proposed tax increase charged to the middle and upper class will be paid off through the increased demand of products.  It is a win win situation, because the working class can now have the money transfusion they so much need, spending it on the middle and upper class to pay off the increase in taxes originally designed to eliminate the deficit created by the once borrowed government money.

This doesn’t sound so bad!  Well, just like in The Great Depression, liquidity was created by injecting more cash into the market, creating jobs, increasing buying powers, which in turn created credit opportunities.  This is not a single social-class, communist country, this is a capitalist country with several financial categories.  The only way to multiply the dollar is to create credit opportunities, which will sequentially create liquidity in the market, decrease supply, increase demand, creating equity in products and cashing in that equity into liquidity causing all commodities to grow favorably.

Now, back to the original questions: 

• Does he know what is doing?
• Is he selling out?
• Does he have enough experience in order to prevent an economic broken future?

Obama is a very keen and smart individual and we chose him as our elected President for those reasons.  He is not selling out. I believe that his plan for a regulated economic revival will be successful. It has worked in the past during The Great Depression and whether you agree or not, we are in a depression; it’s just that we are in different times and is now appearing under a new face and new name.

Now that you understand the strategy to correct the Nationonmics problem, you can now prepare yourself and change your Homeconomics through the endless opportunities available to increase your wealth over time. Prepare yourself for the upswing of the economic boom. As I always tell my students, “Preparation creates opportunity” and now is the time for you to prepare yourself to be a champion of wealth!” Visit our website to learn more about The Wealth Building Academy at www.ecrewslive.com