How to Spend the $800 Billion: Let Us Count the Ways

January 23rd, 2009 § 0

president obamaSpending $800 billion as part of the fund to get the economy going is a daunting task. President-Elect Barack Obama wants to focus on infrastructures, cutting of taxes on the middle class, Medicaid, and invest on the expansion of renewable energy.

A lot are asking why not help those who are about to lose their homes on foreclosures?

The lawmakers are hoping to get the attention of the president-elect to get a big chunk of the rescue package to help people keep their homes.

Some government officials are drafting proposals on how to revamp the TARP and make it friendlier to people who are pushed against the wall with pending foreclosures. Congressed expressed their opinion that they will not be release more funds unless a big chunk of it will be earmarked for helping Americans keep their homes.

Obama, from his perspective, does not disclose the details of his program. According to him, he will unveil the specifics a month or two from now and this will surely help address to help American families.

Experts are pointing out that it will be a big mistake to spend billions of dollars to stimulate an economy without doing anything about the mortgage. The mortgage industry in the US is 16% of its economy.

There are proposals to use around $50-$50 billion of the TARP to help owners with foreclosure mitigation.

There are also calls for the change the bankruptcy law so judges can write down the primary mortgage of the individual. Some worry that this may increase the rates since investors need to compensate for the risks that they are taking.

A lot of experts are also calling for lowering down further the interest rates and offer generous tax breaks for home buyers.

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