Is CREDIT good OR bad for our economy?
It doesn't have to hurt our economy because if used sensibly and in moderation, credit can serve to speed up the economy and enable growth; BUT when people "spend" what they do not have, as you have stated then we have a spending gap and money that is owed to business or government is not being given. I would do more to the side of moderation....easy credit being bad for the economy is a very good argument because 1. it enables people to spend what they do not have 2. slows down economic growth 3. creates spending "extremes" that allows thoughtless/reckless spending but we cannot eliminate credit altogether or the economy would really be at a standstill because people would not be able to spend much at all....sorry i rambled but hopefully this helps a little!
Considering the current US economy of 2016, is it a bad choice to buy a house.?
I think it’s a good idea to buy a house. The value of real estate is increasing again but not by leaps and bounds that would create a bubble that would burst as it did in 2007. When you buy a house you are acquiring equity in an asset. When you rent, you are just collecting receipts for rent paid.My son bought a new house in 2016, and my daughter is thinking about buying a new house in 2017. My son had a gain on his house,and my daughter expects a gain on her condo. So I think buying a house is a good move.
Should one buy a house in the United States given the current economic and political climate?
You haven’t given any details of your current status or where you live, but I’d say if you are living in a state where the economy is doing well and you are stable in your employment, have good financial discipline, buying a house would be a good idea given the current low interest rates.Remember, you can secure a low interest rate over 30 years, that means much of your living costs are fixed for 30 years. What will the rents be in your area in 30 years?If the economy turns bad and you lose your job or your earnings are lower in the future, it is very difficult to turn somebody out of their house, far harder than evicting a tenant in a rented property. If you’ve been a good borrower and you’ve diligently paid your mortgage, the mortgage company would be happy to work something out with you rather than take your house if you were temporarily unable to pay the mortgage.Owning a house provides you with some substantial tax deductions which will lower your taxes. Once you have owned a house for a few years, you will find borrowing money using your house as collateral will be easier and cheaper.In many parts of the country, house prices are steadily rising, so your investment really makes a good return.Since so many people are buying their own homes and tend to vote, the government tends to avoid hurting home owners.
How does the housing market impact the economy?
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Credit score of 515 can i buy a house next year?
I am working on raising my credit score i know it is bad and i have many things on my report that look horrible some very old 5 years or more i am working on the small stuff first if i don't get all my old debts paid by june of next year when i want to apply for a loan can i still be approved or not? how long would it take to fix it well enough to be offered a mortgage loan
What would happen to the economy if everyone stopped buying what they did not need?
When people decide to consume less before their income level changes, they are reducing their marginal propensity to consume. By definition, at a given income level, this would boost the savings rate. But it will also reduce employment available, because the reduced consumption will cause suppliers to reduce production and lay off workers. It is likely that a reduced desire to consume will also be compatible with a reduced desire to work in the average household. Where there may once have been two income earners who hired others to provide child care and home maintenance and other tasks due to a lack of available time or energy, you may see a voluntary reduction in work hours to capture the savings associated with reduced consumption as free time instead of money. The market that matches job seekers with employers will use wage rates to establish equilibrium again. We know that there will be fewer jobs as a result of reduced consumption, and we can assume that there will be lower wages for the jobs that remain, but that will only be the case if more people want jobs than can get them. If everything is proportional, in terms of less consumption also producing fewer workers, then it could just be a drop in both those employed and household income, but no change in unemployment, since unemployment requires people who desire to work but cannot find work.
Why is America's economy so bad?
There are many levels to that question, but the most immediate answer is: central banking. Banks create money through a fraudulent practice called "fractional reserve banking" -- essentially, when you deposit money in your bank account, the banks can create a pile of "fake" money supposedly backed up by your dollars; e.g., you deposit a hundred dollars and the banks loan out a couple of thousand dollars ... which they like to do because they can charge interest for the loans, right?! -- all this extra money makes bad investments look like good investments for a while (hey, they're making money!), so people invest in wasteful and uneconomical businesses that eventually produce rubbish that nobody wants to buy, etc., and eventually the whole house of cards comes tumbling down. Before there was central banking, there was a check on this process, because when you deposited some of this fake money created by Bank A in Bank B, Bank B would want to withdraw the /real/ money from Bank A (in order to have it themselves, so /they/ can make the fake money and earn the interest, etc.) -- so if Bank A created too much fake money, they wouldn't be able to pay and would go 'bankrupt'; also people who thought that was likely would withdraw their deposits (a "bank run"). But central banking allows them all to inflate together without stepping on each others' toes, making the situation worse. Also, removing the "reality" of money (e.g., a dollar used to be a certain mass of gold (1/20 oz); now it's just a piece of paper -- it's easier to print more paper than to make more gold). The very best (and long) detailed explanation of the process I know of is in the book /Money, Bank Credit, and Economic Cycles/, by Jesús Huerta de Soto, which you can get for free in PDF format here: http://mises.org/books/desoto.pdf (see chapters 4 and especially 5).