Hacker News Reader

Comment by shartshooter | Hacker News Reader

As long as the money is given to folks who need and/or will spend it, it feels like this is the exact situation where the federal government steps in for stimulus.

There’s no pull yourself up by your bootstraps talk right now and there shouldn’t be.

I know the single parent working a couple of jobs will spend every dime they’re given in a time like this, just to survive. A yuppie like me would just park it in my savings account until I feel we hit bottom, then invest it.

I’m not the type of person you want to give money like this to. Save it for folks who are really living hand-to-mouth and don’t shortchange them.

View on HN

I mostly agree; the only caveat I'd give is that it's tough to say how much longer any of us are going to be yuppies right now; I work for one of the many big megacorporations whose stock is tanking right now. If the stock doesn't pick up soonish, there's a non-zero probability of me being laid off.

While I'm not that worried (I've been able to find work in bad economies in the past), I also do feel a bit of paranoia about this.

Can you explain how your job is directly related to the company's stock trading price? Not being sarcastic are something, just genuinely curious?

Stock prices are an expectation of future cash flows, the rest explains itself.

There is a bit more to be said about how wall st places more value on layoffs than other adjustments to a company's balance sheet. Employees are seen as a generally ugly long term money sink.

I agree wholeheartedly, investors really dislike raises and bonuses for line employees, and will punish companies for it. Shareholder primacy theory is insanity.

Speaking of insanity, Art Laffer is advising the current administration re: stimulus. How that guy isn’t immediately laughed out of any room he walks into is beyond me.

The stock price is determined by dicounted cash flow valuation of profit, or at least what stock traders estimate it to be. If the stock price is crashing, that means traders are predicting reduced profits. Reduced profits mean layoffs.

The stock could also be crashing because the perceived value of the asset was distorted by market conditions, and the stock index corrections have now produced a far more realistic and scary environment in which value is better understood.

> Can you explain how your job is directly related to the company's stock trading price? Not being sarcastic are something, just genuinely curious?

It’s indirectly related through the executives who make decisions that are primarily motivated by the stock price.

situation is something like:

Stock price going down means market expects less profit

Directors who can react to this change and minimise loss or find opportunities, should.

This can be increasing revenue (assuming that's tough, otherwise the stock price wouldnt be tanking), or reducing cost (some development work created, a lot of other work lost, including dev / management)

I mean, I don't know that it should, but my understanding is that when the stock price dips, and investors start wanting a return for their investment, executives look for quick ways to decrease spending, thus increasing profit (at least in the short term).

One of the easiest thing to do to lower spending is to cut some workers and push their work onto the remaining workers. It's not an ideal situation for anyone, except maybe the executives.

All jobs at a publicly traded company are related to stock price. When a company goes public its primary duty is to the stockholders. So in times of hardship it has to reduce cost to increase income / stock price. The primary way of doing this is layoffs.

Two important points worth making here.

First, huge stock market panics are fear-driven. Partly they're responses to fear, partly they create more of it.

When fear sets in, people get nervous. First-order, that means more concern about protection, downside risk, and survival. In business, that means, how much cash is in the bank? Can we pay our bills to employees/landlords/utilities? Since it's harder to wiggle out from long-term contractual commitments (debt service, leases), employees are often but not always the first to go, simply because they CAN be let go. Not ideal, but it happens. Additionally, hiring slows and since some level of frictional unemployment (google it) is bound to exist, those people won't be as easily re-absorbed into new jobs.

Second point: executives, salespeople, and others "at the edges" are driven by market forces. Interior decision-making, especially at large businesses and far from top management, isn't driven by external market forces to any real extent. A better model I just read in the economist explained it as companies being little miniature command economies (dictatorships), mediated by market forces in their interactions with the outside world. A few examples that come to mind: (a) wages aren't typically adjusted internally when salaries rise externally, (b) most funding decisions are made by management, not external banks/stock market. So probably wise to assume, unless sufficient evidence to the contrary, that mid-level decision making in companies won't be market-driven, it will be done by (potentially more efficient) command mechanisms. A manager tells you to do something and you do it, there isn't some auction mechanism held where people bid on tasks. We do it that way because it's more efficient.

EDIT: The article in question (very good IMO, talks about how uber is creating a semi-centrally planned, non-market driven ride economy: https://www.economist.com/christmas-specials/2019/12/18/can-...)

I guess it is a matter of perception. That is what many Americans companies would do, stock price is everything.

In the UK and EU people doesn't get fired/ layoffs/ or even switching jobs as often.

Why? The price of the stocks does not affect company in any way. If the company sales are going down or clients stop coming this is an issue, stock value is important only for those who hold/speculate using them. You company has already got the money from selling stocks, nobody is going to take them away.

Stock prices are leading indicators of future revenue. Not perfect indicators obviously, but the stock prices reflect lower sales/profits/etc due to reduced mobility, supply-chains etc.

Because if the stock price is tanking, there's an incentive to figure out how to either a) increase profits or b) decrease spending.

Since the market is tanking, there's a likelihood that people will be spending less, thus leading to less profits for my company; as a result, the only easy way to keep investors happy is to reduce costs, and the easiest way to do that is to start doing layoffs.

That only applies for long-term recession projections where the company is seen as doing a poor job, not now where stock is down because there's a pandemic shutting everything down and market volatility is going batshit. As long as the company has enough cash on hand to ride the pandemic out they'd want to retain everyone so they can ramp up again as fast as possible

Well, isn't there fear that this will lead to another full-on recession? I could be wrong but I thought I read that somewhere.

I would very much like to be wrong on this; if I am I don't have to constantly worry about being laid off.

What about all the companies that have been borrowing vast amounts of money at low interest rates to buy back shares?

“ The price of the stocks does not affect company in any way”

RSU value is lower for employees, harder to retain talent, more incentive to fire and cut costs to keep shareholders happy.

> harder to retain talent, more incentive to fire

I struggle to understand how those two things can happen at the same time, to the same company, due to the same cause. I mean, if it's harder to retain talent, presumably this means some people leave the company, leaving the company more dependent on those who stay. Why would they fire them?

Top talent leaves on their own, bottom talent gets fired.

It seems they only share a name? In some stores people are buying more than ever. But stocks are down?

Products for sell on a shelf now have been in the pipeline for months. The stock market is looking past the immediate now, and is looking at the tomorrow, next week/month. If factories are closed and not manufacturing things, the supply stops. That doesn't affect the retail end today, but will in a few weeks/months.

This sounds nice and sound in a textbook, but the real world with humans doesn't follow.

> The price of the stocks does not affect company in any way.

That would be the case in the ideal world. However, stockholders care a lot about stock prices being low, and they elect the board, which in turn chooses/advises the CEO (and other executives). When it's the CEO's butt on the line, the company will be reactive to share prices; just to make sure the stockholders are happy.

A secondary concern is that low share prices makes a company vulnerable to non-/hostile takeover bids - which again is bad for CEO job security.

TL;DR: The tenure of the top echelon (board & executives) of public companies is directly tied to (relative) stock performance due to share voting rights.

Unless you work at a tech unicorn. Remember that uber loses money on every ride, but has grand plans to make it up on volume :)

This is a situation where much of the global economy is going down if this doesn't stop in 60 to 90 days.

The sick leave programs, either public or corporate, will all fail in a short amount of time when strained by 90 or more days of hyper low economic activity. The US and EU can't afford $2 trillion in sick leave programs every 90 days; especially when the future is unknown as to whether that will continue indefinitely (meaning there is weak production to support the huge costs), the entire financial system collapses if that keeps going.

Sometime in the next few months a decision will have to be made, about going forward, going back to normal life, and accepting the deaths that will occur. This will have to be made by essentially all nations in unison, and or the smaller nations will get pulled along into the decision by the larger nations regardless.

First we need to know how common the virus is among the population, in terms of how many people are walking around with few or no symptoms. Some large nations need to be doing massive randomized testing for Covid, to compare positive results versus how many are walking around with it and don't know it. This is data we absolutely must have immediately.

If there are really 10x or 20x the cases and the mortality rate is that much lower accordingly, then we do two things: we go back to work, and we do quarantine and care for the most vulnerable and most ill simultaneously. We ramp up medical supply production further to focus on those people, who will saturate our ICU systems. Everyone else goes back to routine, to keep the global economy functioning. If that all shuts down, far more people will die, and far worse chaos may ensue, including potentially war as tensions rise globally.

Sure people in the top 10% are not likely to need this money, but giving it to everyone is a lot easier and faster than figuring out who needs it the most.

Even in that top 10% there are still people that live paycheck-to-paycheck. I was there not long ago. It's a lot better to give everyone the money and be wrong about ~10% of the people needing it then delay it for people who have bill past due right now.

Yes, a lot of times you'll hear $100,000 as a cutoff for aid. I made $100,000 in the Bay Area. It doesn't go as far as people might think.

I lived in the bay area with a family and moved to Ohio in the middle of 2018. 1/3 of the population living on minimum wage in a 50k population town in Ohio. That is $18,000 per year.

$100,000 has much more purchasing power than $18,000. For you saving $5000 is easy. For someone making minimum wage, saving $500 by the end of the year is impossible.

If you have a car, your deductible might be 250-500. The majority of the minimum wage earners deductible is 500. They usually don't have that when accident happens. When the boiler goes out, it usually cost same to fix it for high earners and minimum wage earners.

Yes, $18,000 has less purchasing power than $100,000, but a lot of people still have this conception that people making $100,000 can't possibly be living paycheck to paycheck.

I generally challenge anyone who claims this to post a detailed budget. SF is expensive, but if it were so expensive that someone making $100k could not cut any expenses, it would not be able to function. Stop contributing to your 401k or something.

Gross $100k

Net after tax: $74k

Monthly take home: $6166

Rent: $3000 ($3166)

Health insurance + meds: $600 ($2566)

Student loans: $1000 ($1566)

Muni: $196 ($1370)

Groceries: $400 ($970)

Electricity: $90 ($880)

Internet: $80 ($800)

Cell: $150 ($650)

Debt: $300 ($350)

So that's $350 for a family of two at the end of the day to spend on life, in a city where two cheeseburgers can cost $50. A lot of times for me this would be spent flying home for holidays. It would take about 8 years to save up enough of an emergency fund to cover 6 months of expenses if 100% of that were put into savings, which isn't realistic. This is a salary that provides a comfortable life, but like I said, it's paycheck to paycheck. If I had a disruption in my income, I would be out on the streets in short order. None of that can really be cut except cell and internet.

First, thank you. Now, I'll make cuts according to how people without means would.

Rent: There are studios and 1-bedrooms to be had. Depending on who your +1 is, share a bed or put someone on the couch. $3166->$1500-$2000

Health insurance: Hah. Order your meds from overseas and cross your fingers. Or go without. $600->$0-$200

Groceries: Everyone on HN keeps telling me healthy food is cheap, you just have to be responsible enough to cook. $400->$250-$300

Cell: Budget plan and wifi. $150->$50-$80

Cut a few bucks from electricity by being super thrifty on energy usage, and save a bit of that debt for your tax refund.

Looks like a few thousand dollars a month in "fat," and you still don't have creditors hounding you. Nice.

I'm not saying that it's ideal to make these kinds of cuts. In fact, in the richest country on the planet, it's practically unconscionable that someone would work full-time and not live with the kind of stability, if minor uncertainty, you currently enjoy. I'm just saying that some of us also dropped half their paycheck into rent, at a quarter the pay, and made due. Well, lost ~$150 a month.

With all due respect, there's zero chance I'd be irresponsible enough to be making 6 figures and still be living paycheck-to-paycheck. I say this not as an attack, but as a call for you to maybe interrogate and recalibrate your expectations for your spending and, by extension, your expectations for other people's spending.

I agree with you that most people can, and should, make some cuts, however, some of your listed cuts aren't feasible in the short term.

Rent: From my experience (n=1) most lease agreements force the remainder of the terms rent due within 30 days of early cancellations, making it infeasible to drastically reduce in the short term.

Health Insurance - If you are getting it through your employer most follow open enrollment periods and cannot be reduced/eliminated in the short term

Groceries: Fairly accurate for a single person, but in the context of the nCov situation many of the more affordable options are out of stock leaving more expensive alternatives.

Cell: Simple expense to cut in the short term, I would add non-essential subscriptions (streaming, etc.)

In order to live a fiscally responsible life, you cannot have such high expenses you are forced to live paycheck to paycheck. Hopefully this will be a catalyst for people to live within their means, but I don't think it is reasonable to expect extremely drastic cuts in the short-term (though I am not saying it was a prudent idea to put oneself in this financial position in the first place).

Maybe if you have family, but that's a comfortable range for an individual.

I was in the same situation. Comfortable? Well, worry free in a sense, but forget about buying a home. No American dream for ya.

I have a family. Lots of people have families.

Why isn't it a direct credit towards rent and free food/water/meds instead of cash? Wouldn't that be a way to ensure it isn't stowed away?

Setting up the bureaucracy to manage indirect funding would take significantly more time than we have.

People are losing their jobs as we speak, and weeks-long quarantines are happening right now too. I have a couple of friends who have literally no idea how they’re going to stay housed and fed.

Well, it's not the government that vends those things. So that's much much harder to administrate than stuffing and mailing millions of plain old paper checks, or even dealing with direct deposit. (Granted that checks have their own problems -- thousands of people don't have banks.)

It's probably just simpler to administer if it's just universal vs having layers of red tape to manage and police it.

You're never going to get 100% of it put back in the economy immediately, but I think a very large percentage of it will.

If I'm a person who doesn't actually need this to pay my rent, then I'm just going to use the rent voucher and take the cash I was going to use to pay my rent and stash that instead.

Why do you care if some people just save it instead of spending on the necessities?

What about people for whom this is pretty close to their rent/food/entertainment budget anyway? You want them to sit in their houses staring at each other with no way to pay their bills for [insert streaming entertainment service here]?

Oh boy - folks am not advocating this :). I was asking a genuine question as a response to the comment that's all. Thanks for the replies.

It is impossible to know from demographic information alone exactly how people will spend a windfall. If we're doing helicopter money, we should do it for everyone equally. Maybe instead of food I buy a bunch of video games or beer or some other good. Still keeping the economic engine running.

I think that we can assume that for people worth low income, savings rates will be much lower than for richer people.

Sure, we can't "exactly" know from demographic information, but the fact that if you have a higher income you have a higher savings rate is pretty basic.

Why not do a progressive amount based on income (available from the IRS)? Those in higher income brackets would receive less, while those in lower income brackets would receive more.

Because some people live in very high cost of living areas - high income alone is not sufficient. Ultimately if you don't hand out the benefit equally you're making some kind of value judgement: you ought to live this way, and not this way, to be worthy of support from the government. This is a _hard_ problem to even quantify. The real goal here is to keep the economic engine running (even on idle). Adding a political dimension will only slow down or block this, which will hurt everyone.

> The real goal here is to keep the economic engine running

I would say that the real goal is to keep people from suffering because they lack necessities, including housing. Granted that the economy is how we supply those things, so we need it to work, but I would say it is a close second priority-wise.

> Because some people live in very high cost of living areas - high income alone is not sufficient.

No system will be perfect, but the government certainly can make adjustments based on dimensions like residence area. (They already do something similar with GS pay scales.) Similar income distribution programs exist in other Western countries (Kinder Geld in Germany comes to mind) so it's not like variations of this have never been successfully implemented before.

At this point, you would have to use 2018 tax year info. 2019 tax filings aren't due for another month, and I think most people file in the week before the deadline.

There's a lot that can happen to income levels in that time period.

There is a degree to which people who make more need more in cases like this, i.e. if one person makes $80,000 and another makes $40,000 and they both have their hours cut and lose half their income, the one who "makes more" just had their income reduced by a larger amount and is likely to have higher recurring expenses to carry.

On the other hand, the person who had been making more has had more opportunity to save. So it goes both ways, and giving people the same amount of money is a middle ground that also has the advantage of being much administratively simpler.

The government pulled more money than this out of thin air to throw at the stock market just the other day, only to watch it vanish just as quickly. Money is a fiction that we have invented to grease the wheels of commerce.

Why bother creating a bunch of rules that people have to apply in the middle of a crisis? You are living human who has not received this month's stimulus yet, great, here you go, good luck and blessings upon your health. Bureaucracies take time to spin up, more complex rules take longer to apply, and there are a huge number of people whose jobs are destroyed by "don't go outside until the virus dies off".

If you are way too rich for a thousand bucks to mean anything, then give it to someone who needs it more. Maybe a super-broke friend, maybe just withdraw a few hundreds and hand them out to homeless folks, whatever.

Giving to everyone is the simplest and cheapest and quickest approach. If you do not need the money just pass it to someone who needs it more.

Yep. Trying to carve out one group or another is exactly how we end up with a convoluted tax system and subsidies.

Implied in your comment is that today's crisis is one similar to 2008 in that the economy needs "stimulus."

Today's crisis is different. The regular economy is grinding to a halt because we have to in attempts to slow the spread of the coronavirus.

What individuals and every component of the economy need are deferral and cancellation. Rubidium talked about it in another post. [0]

$1,000 to a family that is living paycheck to paycheck doesn't solve the problem. Do a search and most surveys put America at somewhere between 70-80% of workers living paycheck to paycheck.

So let's discuss giving Americans money but only to move the Overton Window. Then let's lead that discussion to solutions that address the fragility of our economic problems at their root--both in the short-term and long-term.

[0] https://news.ycombinator.com/item?id=22604982

In general, giving things only to poor people generates opposition to the program giving it. The attitude is, "Why should my hard work pay for those lazy people." Means testing can also add a lot of overhead and headaches for the people involved.

My suggestion: use it to pay down your upcoming tax bill, give it to people you know could use it, if you order food, leave some really fat tips for the delivery guy, donate to charity.

Using what you don't need to further help people around you is a really great suggestion!

How charitable, now to implement that everyone has to prove their level of income and assets before receiving aid and will unnecessarily screw people on the margins in situations you didn’t imagine up front. Stuff like that gets implemented (usually, in America) as a non-refundable tax credit meaning the poorest get nothing as well.

Just cut the check, tax the rich, and don’t make more paperwork.

Morally that is the right choice. Politically, there will never be a way to pick only the people who really need it. Everyone makes that more tenable.

>A yuppie like me would just park it in my savings account until I feel we hit bottom, then invest it.

That sounds like stimulus to me.

more like quantitative easing.

Issue with not giving it to everyone is that a large portion of people with a good, financially secure job could find themselves unemployed in a week or so as layoffs ramp up. We are going to see massive layoffs in the next few weeks, especially in retail, food services, travel and entertainment.

In addition, we should be flooding individuals and households with money right now to ensure survival. An over payment of 10% is far less harmful than an underpayment of the same amount.

"Means testing is hard. [Sending a check] is easy." Don't add the overhead / cost / etc for the benefit - speed is key, just cut the check in my opinion.

It often costs more than the money, to set up a bureaucracy just to decide who gets it.

Or perhaps stop obliterating an economy and let them actually live.

My sister and I were raised by a single mother in Russia in the 90ies, and we did relatively well compared to many. Mom mentioned once that she didn't really regret not having any hobbies or personal life for 10 years, not only because she loves us, but because she really didn't have time or mental effort required to seriously ponder these things, in almost a decade. That was all, mostly, because of economic mismanagement.

If you look at the life expectancy chart for Russia at that time, and births - both, again, affected by economic mismanagement - it's quite obvious that it would have been much better even in terms of literal years life lost to have a magical smooth economic transition in 1991, followed by a 100% unchecked coronavirus epidemic.

The unchecked covid-19 would have caused far less harm that what the real loss of life was; and that is before you consider lives wasted - the struggle to survive, but also drug use, alcoholism, crime, suicide statistics from the period. Oh and of course the end result - in Russia, most now want stability at any cost, so you have an emperor for life.

This recession is looking like it's going to be bad, and politicians from NZ to Malaysia to the UK are saying it's going to be worse than the last one or 1997 one; the way Fed is handling it here indicates they expect something worse than Great Depression, or they are out of options and are going to run it completely into the ground.

Meanwhile, the damage from the actual virus /so far/ is zero, literally zero, a rounding error. Yes, I know about Italy - the deaths there up until now are still a rounding error. Yes, I know about the exponential growth - the current levels are still a rounding error; they will grow exponentially, but exponential growth runs out very, very quickly when it has an upper bound of the entire population.

It would have been much better to have a one-month-long healthcare collapse where a million people with an average age of 60+ die, instead of a prolonged recession or a depression where tens/hundreds of millions of people in US alone, disproportionately young, children, the poor (not even speaking of the people in developing countries), have their life completely ruined - for many, forever; and many die.

Under normal circumstances, we could make it opt-in. This was a stipulation of Andrew Yang's UBI policy.

It could be argued that under current circumstances, creating an opt-in mechanism might increase administrative complexity. That said, I imagine you still need a simple mechanism to figure out eligibility. Do non-citizens qualify? Permanent residents? Short-term visitors? International students? Only people with SSNs?

So if there's going to be an administrative layer anyway, the difficulty of adding an opt-in mechanism to that layer would be marginal.

"Opt-in" systems have disappointing levels of people who need the benefit but are too proud or scared to claim.

Where possible avoid this problem and give the benefit to absolutely everybody. The administration is simpler, it will get to all those who need it, and if you become concerned Bill Gates is getting too much free childcare or whatever, feel free to increase his taxes accordingly.

> "Opt-in" systems have disappointing levels of people who need the benefit but are too proud or scared to claim.

Is there any source to this claim when it specifically comes to giving people money for opting in for something?

Using some nordic countries as example, many of them help people by giving them money each month in order to survive. These people are not too proud or scared to claim free money when they need it. My guess is that people from the US will act similarly.

Specifically for giving cash money? No. But the UK has experience with benefits that are automatic versus have to be claimed and it's noticeable.

As an example elderly people in the UK are entitled to use some types of public transport at no cost so as to ensure they don't end up isolated (of course right now isolating them is a good idea, but ordinarily it's a problem). But the entitlement takes the form of a smartcard with photo ID. So of course you need to do paperwork to get it. The very wealthiest may not bother, if you have a chauffeur who cares about free bus travel? But the poorest don't apply at anywhere close to expected rates, because somebody needs to explain to them that they need to apply, help them take a photograph and upload it, and so on.

Are you sure about Nordic countries just "giving people" money with no strings attached? They have much better social safety nets than the US, which are important for softening things like this - but an improved social safety net is not free money.

How do you decide who needs it? I think the sane option really would be to give it to everyone and increase taxes to compensate. Progressive taxes fall most heavily on those that can afford them. They are the best tool for this job.

Of course to really get this fair, you should tax wealth too, which tends to be difficult...

I've seen people mention putting some sort of "use it or lose it" time limit on the money, so that people are motivate to inject it directly into the economy instead of just sitting on it.

I'm not sure how feasible such a thing is or if it would hurt the cause of keeping the economy moving.

I just don't know how you would enforce this and even if this money "only" helps a family with some means have a cushion to worry a bit less so they can continue as they were it would be productive for markets.

Say you send a prepaid Visa card (this would be terrible because of fees but go with it) to everyone with an expiration date, it'd be easy to parlay that into vehicles that were not "spending" (gift cards, other pre-paid cards, etc) and regulating that is a nightmare.

Once you get into qualifiers and enforcement regimes you're slowing things down and adding percent costs to each dollar provided. I'd say keep it simple.

> As long as the money is given to folks who need and/or will spend it, it feels like this is the exact situation where the federal government steps in for stimulus.

No, it's still a bad idea as stimulus.

It might or might not be the right idea from a humanitarian point of view. No opinion on that topic.

But if you care about nominal spending in the American economy, the Fed can do the job just fine. Just have them buy assets until total nominal spending (and thus also inflation) is up where you want it. Start with American government bonds, but if that's not enough, expand to other assets as well and keep buying.

You may ask: what if this doesn't work to raise spending nor inflation?

Well, that's the best case! Congratulations: that means the Fed just bought up all the assets in the world in return for some ink and paper. [0] And all that without devaluing the dollar, since we assumed no inflation would result.

Your negative example of people _not_ spending the money they are given turns into the best kind of person you want to be buying assets from, if you are the creator of said money.

Of course, in practice this will raise spending. Especially if you announce the policy in a clear and credible way, spending will increase almost immediately even before you implement anything. Markets are all about anticipating expected events.

No need to enlarge the government budget or the deficit.

Oh, and if you are looking for practical steps to raise spending in the economy and the above programme is too radical for you; then a simple first step is to eliminate positive interest rates on (excess) reserves that banks park at the Fed.

In the Fed's defense, they lowered the interest on excess reserves to 0.1%. But you can argue that they should lower it further, perhaps to -1%. Make banks pay to park money at the Fed, so that they prefer bringing that money into the real economy. Either by spending it themselves, or by lending it to people to spend it for them.

[0] To be more precise: in return for some even cheaper to create numbers in a computer. Nobody prints these sums of money any more.

There are a lot of businesses out there that are non-essential services, that will be hit hard by this. Someone still has to shop at the local bookstore when this is over, because those people – even with direct stimulus – will be struggling to stay afloat. If we want to start the economic flywheel spinning again, it's gonna take stimulus at pretty much all levels.

Most working class people will spend that money directly on essential goods and services. But for the health of the overall economy, it's important that enough people will have enough that they feel confident they can start going out again and supporting all sorts of shops.

> A yuppie like me would just park it in my savings account until I feel we hit bottom, then invest it.

I would personally feel obligated to spend it, and I normally save 75% of my income.

Why not _offer_ helicopter money to everyone instead of giving it? Allow people to accept it, but don't oblige them to.

Keep it universal and simple, but optimise for cost:

- A/B test the messaging.

- Make it opt out for lower incomes and opt in for higher incomes.

- (?) Offer opt out-ers the possibility to dedicate part of their helicopter money to specific budgets (culture, army, police, medical care, ...)

normally a stimulus works because if you give people $1000, people will go and spend at least some of it. With most options for discretionary spending shut down, there's really just two things left to spend on: rent and groceries (and i guess: amazon orders).

$1000 to every american right now will end up just being a huge payment to landlords. i'm not saying it's a bad idea, people still need to make rent and buy food, but it's not going to stimulate anything. grocery stores are already bringing in record revenues, and landlords don't need the money. It's financial aid, not a stimulus.

Combine a handout with negative interest rates, and you almost guarantee it will all be spent, as it loses value sitting in a savings account.

> As long as the money is given to folks who need and/or will spend it

only if admin cost to determine if a person needs it is low enough.

> Since the administration wants to prop up the markets, this also helps accomplish their goals.

This attitude is why things do get done.

> There’s no pull yourself up by your bootstraps talk right now and there shouldn’t be.

Joint statement by conservatives Stephen Moore, Art Laffer, Steve Forbes: "Don’t expand welfare and other income redistribution benefits like paid leave and unemployment benefits that will inhibit growth and discourage work" [1]

[1] https://twitter.com/JStein_WaPo/status/1239938361231585286

I think the simplest solution is to give money and raise taxes on the top 60%. Undo what Trump put in place and go back to taxing Americans a little more.

This way the benefit only applies to the bottom 40% of tax brackets and at 40-60 you pay some if not all back and 60+ you pay it all back and more. Then it's a fair safety net that everyone can see might be necessary in these times.

This is just a thought, I'd actually just put Yang in charge of this.

I agree in the sense that money will go further when pooled, than if you just give it UBI's style. But, this is a societal crisis, not an individual one. It is not fair to ask people to pull themselves out of a situation that they did not create, but that our unaccountable government did create.

An example: restaurant are struggling and some people need food. Give money to Town gov, so they can buy food from restaurants and serve that in community center. Adjust volume as needed.

Plus the whole financial easing they are trying is dumb. It would be useful if the intention was not to control what is happening with the public markets. We just do not really control those, not on a daily basis anyway. Algorithms heavily relying on market volatility control those, and that is what they are doing right now. So, seeing an administration believing that humans are in control of a mostly automated trading system is dumb.

While the evolution of new virus with pandemic property is not something we control. Its propagation to pandemic level is something we have absolute control on. We are failing as a society, because we allow those things to happen.

Reply on news.ycombinator.com