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Cutting to the Core

Free money isn't the answer to looming recession

I'm looking forward to that $900 check George Bush wants to give me this year. I'd accept any check for $900 anyone wanted to give me for that matter.

Bush believes by giving each working American a little extra money this year to spend will stimulate the economy and help our country avoid an expected recession that's waiting to swallow us.

That doesn't sound like a bad idea but I don't think that will solve the problem. We need to get where people can spend money whenever they want, not just once a year when the government gives it to them.

How do we do this? I'm not sure because I'm not an economist, but I do have some ideas.

How about forcing these credit card companies and mortgage lenders to lower interest rates.

The way I understand it, this housing crunch most of the nation is currently in is the result of fluctuating interest rates. The initial period promised a low rate and then the rate was bumped up. This left people unable to afford their house payments, resulting in foreclosure.

Credit card companies do the same thing. Missing a payment can cause your interest rate to go up. I've even had my interest rate go up because I had too much debt for their comfort. I hadn't missed any payments but just the amount of debt I had made them uncomfortable so they felt they had to raise my interest rates.

Citibank actually raised my interest rate to 32.99 percent because I was late on a payment. That's robbery.

I tried to get them to lower it but they refused, so I did the same. I refused to pay them.

I don't recommend that course of action for other people but it worked for me. They lowered my interest rate to 6 percent for one year and I will have them paid off in that time. My card is closed but that doesn't matter to me, getting it paid off does.

I've gone a few rounds with Citibank over the years. One time when I was trying to get them to lower my interest rate they flat out refused again. The man I was talking with then offered to cut approximately 90 percent of my debt if I would make a one-time payment so they could charge the account off and close it for good.

This guy was unwilling to lower my interest rate so I could pay off my entire debt but he was willing to let 90 percent of my debt go. That doesn't make any sense to me. I wanted to pay my debt, I just didn't want to get ripped off with high interest rates.

If the government forced these companies to offer fair interest rates then people could pay off their credit card debt and home loans. Isn't that what everyone wants?

So when I get my check in the mail I'll be thankful and I'll immediately spend it, doing my part to stimulate the economy. But I would much rather forego the check and see interest rates lowered to reasonable levels. This I think would be the best way to stimulate Mother America.

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