Embedded within the dense legislation were provisions changing the Roth IRA rules.  You may not have noticed at the time.  That’s understandable, because some of the actual changes mandated within the Act weren’t schedule to kick in for years.

Now, 2010 is right around the corner.  We’re preoccupied with H1N1 and the bird flu has joined SARS on the list of “really bad things that didn’t really materialize.”  President Bush is splitting time between his ranch and the motivational speaking circuit.  The Yankees didn’t re-sign Williams and now he’s off playing guitar somewhere.  Oh, and those TIPRA changes are about to kick in–and it’s a good idea to start paying attention.

That’s because the law is making the retirement account option more accessible.  Previous limitations on Roth IRA participation are being cast away.  That’s important news if you’ve been unable to take advantage of the Roth option and now can.  Why?  Because they are one of the best deals around.  The Entrust New Direction Blog explains:

The Roth IRA is quite possibly the best deal the federal government has ever offered tax payers.  But until 2010, this fabulous deal was only offered to people earning less than (approximately) $100,000.  Not so in 2010.  The federal government has announced a suspension of the rules for 2010.

The Roth IRA is like the pot of gold at the end of the rainbow. You can rollover any amount of money from a traditional IRA or 401(k) into a Roth IRA, and every dollar you earn with that money is TAX FREE.

SeacoastOnline outlines an even longer list of benefits associated with a Roth account:

No required minimum distributions for those 70½ or older.

No limit on the amount that can be converted.

No limit on the number of conversions.

Ability to re-characterize if desired.

Potential tax-free compounding.

Potential tax-free income distributions for the Roth owner and named beneficiaries.

Potential tax-free wealth accumulation for heirs.

The problem for many people was the fact that the Roth IRA rules restricted use of the account to those who had a MAGI (modified adjusted gross income) of over $100,000.  That limitation is now history, thanks to those TIPRA changes.  As a result, as many as 13 million Americans now have a chance to convert their traditional IRA to a Roth or to open a new Roth account.

If you’re part of that 13 million, it’s time to get a Roth Started.  Not only are the accounts a strong option, they’re even more attractive due to the current economic situation.  GoodFinancialSense notes that, “The market is still in a recovery phase and you could benefit from converting when your account balances are lower and pay less income tax.”  As an article in Kiplinger’s Personal Finance argued:

“Roth IRA conversions are the silver lining to the economic crisis,” says IRA expert Ed Slott, a CPA in Rockville Centre, NY.  “The may be the lowest tax rates you’ll see for the rest of your life.  And with account values down, it’s a double sale.”

If you don’t have a Roth IRA, you need to consult with your adviser and/or investigate the Roth IRA rules to see if you can make use of this powerful retirement savings options.  The 2010 conversion and the elimination of the MAGI-based restriction aren’t the only Roth IRA rules to have changed and you’ll want to know all of the gory details before making any changes.  However, overall these changes appear to make Roths more accessible and more attractive than ever.

Hopefully your personal budget at home isn’t seeing the kind of shortfalls the California budget is dealing with. At the Lampsen home, we’re getting by better than many I’ve talked to, but “doing well” in a downturned economy is not saying much. We’re still at the point where if unexpected money shows up, it’s greatly appreciated, and just that very thing happened the other day. An unexpected bonus came through at work — a couple American Express Gift Cards.

If you haven’t purchased or received these before, they’re basically like cash. You don’t have to redeem them at a specific coffee shop, bookstore, sporting goods outlet. You don’t even have to go to a chain restaurant and sit in a booth surrounded by historic memorabilia. No, these American Express Gift Cards can be used anywhere that American Express is accepted. Apparently this equates to over a million places.

Receiving unexpected cash flow is wonderful. I feel sorry for the vendors who provide the State of California with great service month in and month out, only to receive IOUs as payment. Controller John Chiang started sending them out July 2^nd, when the budget failed to pass. In the past, it was the employees who received the IOUs, which pay interest at somewhere between three and four percent–not bad, if you’re cash-rich and can wait until October (or whenever the budget eventually passes) to collect your money.

So far $355 million in IOUs have been sent out, mostly to 90,000 small businesses, and tax payers who are due a refund. The world’s eighth largest economy is in trouble. To make matters worse, three top national banks — Wells Fargo, Bank of America, and JPMorgan Chase — all stopped accepting the IOUs as of last Friday.

I think there are a few business men and women out there hoping some American Express Gift Cards would show up in their mailbox, too. Available in amounts from $25-$3000, these little gift cards can buy everything from a used car to a tank of gas for that used car. I suppose that the high price of gas would make a $25 gift card more appropriate for a week’s worth of coffees as opposed to a tank of gas.

I suppose California State employees should be happy they actually still need to buy gasoline for their car, considering that they have a job and all. Though missing four days a month due to furloughs is probably hitting their pocketbooks in a rather unpleasant way. Surely if Governor Schwarzenegger and lawmakers can’t come to some agreement on how to close the budget gap within the next few months, there are employees who are going to be seeing pink slips in their inboxes. An even greater number will probably see IOUs.

At times like these, when the news is filled monetary doom in certain sectors of the government or financial market, I smile knowing that in the Lampsen home, we’re “doing well.” Still, the unexpected cash never hurts and certainly isn’t turned away. I’ll take a gift card over an IOU any day, and a card equal to cash is even better. Best of all is that unlike cash, if the American Express Gift Cards are lost or stolen, the unused portion can be replaced or refunded. That kind of financial protection is appreciated in a time like the present.

Now that I’m getting a little older, I realize that the next time I get an AARP offer will probably be about the time I actually qualify for one.  That’s a little disturbing, to tell yout the truth.

And “disturbing” is a good segue to a discussion of our current healthcare problem in America.  The cost of medical care is mind-boggling and I think that even the most conservative and liberal folks around can agree that we have a real problem.  There are too many people without insurance or who are under-insured.

I’d like to think that we’d all like to see people carrying adequate insurance to protect their financial interests and to guarantee necessary medical treatment.  That should be true whether you’re head over heels in love with a single payer system or if you’re a laissez faire buff who’s ready to see the government walk away in favor of market solutions.

The AARP seems to have a strong interest in a better system, too.  They’re always lobbying for reforms they believe will better serve their membership base.  They’ve been actively involved in Medicare issues for years and have become a formidable lobbying force.

The AARP also offers insurance policies to its members.  There really isn’t such a thing as “AARP health insurance” in a strict sense, though.  The organization has actually forged relationships with insurance companies like UnitedHealth Gruop and offers their policies to the membership.  So, while people are actually buying a policy through a different provider, it’s still often referred to as “AARP health insurance“.  These sales constitute somewhere between 25% and 35% of AARP’s revenues.

All of this seems perfectly reasonable on its face.  The AARP sticks up for the interests of its members in terms of legilsative reform AND offers them what the organization believes to be quality insurance projects.

When you consider things a bit more closely, however, this arrangement may very well represent a conflict of interest.

In 2006, for instance, critics accused AARP of softening its support for drug reimportation reform that would make it easier for Americans to purchase prescription medications in Canada in order to save money.  Some argued that the AARP’s seemingly modified stand on the issue stemmed from a recognition that its own financial interests would be ill-served by great re-importation.  As one observer questioned, “Is it a major conflict of interest for AARP to claim to be a benevolent spokesperson for older consumers, when the “issues” are extremely important to their financial well-being?”

Many feel that the AARP has failed to support the right kinds of Medicare reform over the years.  The alleged reason?  A significant percentage of AARP health insurance sales involve products designed to “fill the gaps” in Medicare coverage.  If Medicare were properly repaird, critics argue, AARP would stand to a lose a lot of business.

It’s not hard to see the potential for conflict of interests, even if you don’t believe the AARP has yet failed to support its members best interests.  There’s a natural potential tension between marketing insurance products and lobbying the government for reform of the healthcare systems.

An NPR story pointed out just how tricky the situation can be when discussing 2007 efforts to deal with the health care crisis:

“And its new contracts are making AARP’s politics even more awkward. As part of its deal with United Healthcare, AARP will become the largest single sponsor of private Medicare health plans under a program called “Medicare Advantage.” Yet the group is lobbying to reduce payments to those Medicare plans, which analysts say are being overpaid by the government.”

I’m not ready to echo the sentiments of long-time AARP foe and former Senator Alan Simpson.  Simpson was quoted as saying, “If there was a sublime definition of conflict of interest, it would be AARP from morning to night.”  I’m not at that point,  but his words do remind us to look closely at what the AARP does and why they might do it.  It may not always be a matter of benovolence for its membership.

The last time I checked, there were a lot of pretty smart people making a pretty darn compelling argument that this whole recession is a “chickens coming home to roost moment”. We’re paying the piper now for a long debt dance during which people financed homes they couldn’t really afford and lived with little plastic cards clutched tightly in their hands. We overextended as Jane and John Doe. The big banks went too crazy. Everyone ran around writing checks that they couldn’t cash and finally the entire credit-based artifice began to crumble, crushing many underneath the rubble.

So, what would the smartest possible reaction be to all of the mayhem?

I’ll tell you what it wouldn’t be… It wouldn’t be a government program designed specifically to encourage people to make large purchases on credit.

I mean, really, if you said the best way to create a sustainable economy involved increasing consumer debt loads, you’d be a laughingstock, right?

Wrong. Enter the “cash for clunkers” law.

This legislative gem provides folks who are driving fuel-inefficient used cars with a voucher worth either $3500 or $4500 (depending on the car’s mpg rating) to use toward the purchase of a brand new chunk of American steel!

Now, as you’ve probably noticed, new cars tend to cost more than $3500 or $4500. The Yugo is long gone. Even the el cheapo, no features standard vehicles run around twice the max voucher amount.

So, you’re tooling around in a 1990 Continental featuring a primer gray, yellow and red color scheme due to the previous owner’s affinity for fender bending fun. You’re sucking gas like a dehydrated guy holding a Super Big Gulp. Even if the car had tires with tread (those little wires poking out don’t count), it wouldn’t be worth $3500. But now, you can get a $4500 voucher to put towards the purchase of a brand spanking new Chevy Cobalt.

Where are you getting the balance of the money? Well, duh, the helpful people at GMAC Auto Finance will loan it to you. Or someone else will. Some dummy will spot you the extra moohlah, even though you might end up paying fat interest on the loan.

End result? You just added big ol’ chunk of change to your debt load. Instead of owning your Continental outright, you’re working part of every day just to pay GMAC.

Now, we can probably assume that you don’t have a ton of cushion in your monthly budget. Most folks limping along in rustbuckets aren’t living the high life. Thus, when something BAD happens (and it will), you’re going to have an issue making that car payment. Or you’re going to stiff someone else. Or you’ll go hungry (which seems like a high price to pay for a Cobalt). Odds are that you’re going to be trying to find a way to stave off the repo man when you become the unlucky person who officially pushes us into 10% unemployment.

More debt without more income? Bad. More debt in an already “iffy” economy? Bad.

Plus, cars are a miserable investment in the first place. Depreciation is faster than a new Mustang.

So, the cash for clunker law exists to encourage people to increase their consumer debt by purchasing an item that will lose value before the ink on the loan agreement dries.

Wow.

And that’s not all. It’s going to mess with the market value of older cars, artificially increasing their value and making them harder for the working poor to afford. It’s the worst kind of economic engineering.

The silver lining? It might not make a difference. It might be that the reeling credit industry won’t bother writing loans on new cars for voucher holders, anyway.

So, the cash for clunkers law would either make things worse or have very little real impact whatsoever. A loser either way.

If you want to read about the details of who can get what in exchange for what car and other assorted fun facts about this bit of foolishness known as “cash for clunkers,” check here.

Some other good reading: Elizabeth Hovde and I don’t share the same overall political perspective, but she’s so right about this law that I almost want to kiss her.

I’m going to try to maintain that with this post, although the subject matter makes it tough to remain “above the fray” or non-partisan.

Here’s the deal.  President Obama and a Democratically-controlled Congress ran, at least in part, on the idea that it was time to pump some bucks into the economy in hopes of staving off a deeper and nastier recession.  Since his election, Presiden Obama has signed into law provisions creating more spending than anyone can truly comprehend as means of turning the economy around.

The economy isn’t turning around.  The stimulus doesn’t appear to be stimulating.  After reading a recent Associated Press article about the White House’s approach to the not-so-stimulating stimulus, I thought people might be interested in trying to figure out why it isn’t doing the trick.

Instead of giving you my personal take on why this is happening, I thought it might be nice to share a few possibilities.

It needs more time. Only a fraction of the money planned for stimulus spending has been pumped into the economy at this point and some supporters of the stimulus package will tell you that it will start working once the circulation of the cash begins to grow.  More of that money is supposed to be in action this summer, so if you take this position, you’re probably expecting progress soon.

It could be worse. You don’t hear this a lot, but I think that it might be fairly persuasive.  It’s possible that the stimulus hasn’t pulled us out of recession but that things would be a heckuva lot worse if we hadn’t done anything at all.  The President sort of hinted at that when he recently stated:

“Now, I know that there’s some who, despite all evidence to the contrary, still don’t believe in the necessity and promise of this recovery act.”

“And I would suggest to them that they talk to the companies who, because of this plan, scrapped the idea of laying off employees and, in fact, decided to hire employees. Tell that to the Americans who received that unexpected call saying, ‘Come back to work.’”

Rose-colored glasses have limited the stimulation. This seems to be a developing theme among those who are speaking on behalf of the stimulus package and the White House.  Basically, they’re telling us that the original plan was created based on estimates that were later shown to be a little too optimistic.  That’s why we’re not back down to 8% unemployment and it’s why the economic graphs aren’t yet showing an up-tick.  The apparent solution to this error in estimation would be a little patience and/or more stimulus spending.

It’s not going to work.  Period. While the other explanations assume that the core thinking behind the stimulus package is sound, maniy will argue that it was doomed from square one and that the programs and spending aren’t going to do solve any economic problems but will instead exacerbate them.  As you’d probably expect, most of these arguments seem to be coming from free marketeers and the loyal GOP opposition.  The fact that they’re biased doesn’t mean they’re not potentially right (that holds true for the previously mentioned takes, too).

So, if you’re trying to figure out why you’re wallet isn’t being stimulated and are questioning the whole shebang, you can take your pick from those explanations.  Regardless of which one(s) you choose, the fact of the matter is that things aren’t yet looking up.  Until they do, it behooves all of us to do our part to back the approaches we feel offer the greatest chance for success and to do our best to keep our own financial houses in order throughout this downturn.

I know I promised to try to keep my politics out of this, but I don’t want to be accused of surreptitiously spinning the issues here.  So, I’ll come right out with it.  While my vote is always in play, I vote with the Democrats more often than with the Republicans.  I voted for Barack Obama and would do so again against the same competition.  That being said, I am not convinced of the stimulus package’s wisdom and an unimpressed with the unwillingness of Americans to accept the temporary pain of market adjustments.  I’m hoping I’m wrong, though.  I’m hoping that we’ll start to see and feel that stimulus package kicking in soon.  Misplaced or not, I always hope for the best after something’s been done, even if it’s not what I would’ve done.

Keep your fingers crossed.

Instead, I found myself looking at a collection of extremely opinionated sites and blogs that were more interested in ax grinding than in providing real information about the American Recovery and Reinvestment Act of 2009.  There were those on the far left who decried the bill as an Obama sell-out.  There were those on the right who seemed to think that calling it “porkulus” is so clever and who pepper every other sentence with “socialism” or “communism”.  The mainstream left seemed to be more interested trumpeting imminent success of the legislation than in discussing its actual composition.  The mainstream right wanted to discuss deficit spending–not the actual components of the bill.

It made me wonder.  Where can you actually get information about the economic stimulus in detail?  You know, real information about what’s in the law, as opposed to opinion about the legislation in general terms or specific attacks/praises of a few individual provisions…  There’s plenty of healthy (and unhealthy, for that matter) debate out there about the package, but the actual provisions of the law are drowned out in all of the screaming, smarminess and editorializing.

Don’t get me wrong.  I like opinions.  I have a few myself.  I like sharing them, too.  I enjoy a vigorous debate.  Sometimes, though, you just want a little factual information without all of the hollering.

In hopes of putting folks in touch with a little bit of that, I’ve compiled a brief list of where you can get some relatively straightforward information about the American Recovery and Reinvestment Act.  Here’s where you can learn about the economic stimulus package in detail…without too much editorializing.

The Full Text of the Law. Sometimes, you need to take a long look directly into the horse’s mouth.  You can read the whole law.  It’s provided in PDF form, so make sure you have the latest installation of Acrobat up and running.  If you’re not interested in wading through all 400+ pages of the online version of the bill, you can search the PDF.  The search tool is surprisingly fast, considering the size of the document and seems to work well.

Bubble Chart and Other Graphics. If you’d like to see a breakdown of how the stimulus money is being spent, you can take a look at the bubble chart from Recovery.org.  Obviously, this is coming from the current Admininstration which means that it was drawn up by a supporter of the law.  As such, you have some language choices with which not everyone would agree.  However, the bubble chart breakdown, the per state distribution map and the list of expenditures on a per agency basis are all seemingly solid sources of core information about the law.

Another Graphical Breakdown. Here’s a more detailed graphical representation of where the stimulus money is going.  The overall accuracy seems good, though I’m sure we could argue over details.  The trick here is to scroll to the right as you evaluate the information.  It’s an interesting way of showing how resources are to be distributed.

Read the Stimulus. This site was originally set up while the law was still under consideration.  It called for greater transparency during the deliberative process.  Today, you can still use the site to search the full text of the ARRA.  You can do that with the official government PDF, too, but this does seem a little quicker and may be a welcome alternative for those who don’t like dealing with PDFs.

There are a number of reports available dealing with individual provisions of the economic stimulus package in detail, as well.   Once you pinpoint the aspects of the law using a search of the full text of the law, these become much easier to find.

If you want specific information about the actual provisions and details of the ARRA or just need an overall picture of what it actually contains–not what people think about its politics or the likelihood of its success–you may want to start with the above-mentioned resources.  Sometimes it’s nice to just find out what’s really in there instead of dealing with folks on both sides of the political divide claiming that an apocolypse/massive economic boom are on the immediate horizon!

It’s true, the millionaire crowd has taken a massive whipping in the marketplace.  The stock market nosedive and all of the associated bad economic news has taken a toll on their investment holdings.  It’s never fun to lose money, even when you have some of it.  It’s probably more than a little frustrating to see your portfolio shrink faster than a 400-pounder on The Biggest Loser.

And while some of the dissatisfaction expressed by 46% of the millionaires may have been an attempt not to rub others’ noses in their cash heaps when times are tough, the resounding message coming out of the Fidelity survey could be expressed like this:  46% of millionaires have absolutely no sense of perspective.

Unemployment is around 9%.  Although we’ve slowed the slide toward economic armeggedon and will undoubtedly survive this downturn, things aren’t going to get better tomorrow.  Life is tough out there for many, many people.  It was tough before the downturn for many, many others, too.  While the millionaires are bummed about losing money, they should try to remember that they were fairly lucky to have some money to lose in the first place.

People have lost their homes.  There are over 100,000 people in chronic homeless nationwide–and that’s just “chronic” status, who knows how many people are temporarily in trouble right now?

While millionaires lament the status of their portfolio and the drop in their home’s value over a slightly smaller cut of Kobe beef, someone out there is sucking ketchup packages in the rain.  While the millionaires don’t “feel” wealthy, some kid is not feeling well because of malnutrition.  Who do you think is better-positioned to come out of this downturn in good shape?  I’m thinking the millionaires are.

Forgive me if I don’t weep a crocodile tear for the dissatisfied millionaires of America.

Don’t get me wrong. This isn’t some kind of crazed “eat the rich” populist rant.  I don’t dislike the rich because they have things.  I understand the role those with greater wealth play in the well-being of the overall economy.  I know that they’re people, too, and I want them to be happy.

HOWEVER…  Anyone who can look out over the economic landscape right now with a net worth in the millions and feel anything less than wealthy just doesn’t get it.  Hey, 46%ers, it’s time to recalibrate your perspective!  Maybe you shouldn’t “feel rich”.  Perhaps, instead, you should feel “wildly rich and much, much better off than so many other people that I thank my lucky stars fifty times per day”.

According to Fidelity’s survey:

Asked what made them feel wealthy, most said to “live within means with little or no debt and with spending under control.”

Here’s a solution, based on that response, for the sad millionaires among us.  Spend less and adjust your idea of what “living within means” really means.  That’s what everyone else has been doing for the last year or two.  Welcome to the party.

Let’s get things moving.  A better economy.  Let’s eradicate poverty to the extent possible.  If we can do that in a way that allows millionaires a little more breathing room, so be it.  I’m not just on the side of the poor.  I’m on everyone’s side–even the Thurston Howells of the world.

In the meantime, if you’re toting a net worth of a million dollars or more, develop some perspective.  You might not feel wealthy but you are.  If you’re not sure, ask someone who’s gone from a working class home to a homeless shelter.  Ask a few of the half million people who lost their jobs last month how you’re doing.  I’m sure they’ll let you know.

It’s a great time to head out to the stadium to watch the boys of summer do their thing.  Unfortunately, many people who would have a blast at the old ballyard are staying home because of the costs involved.  Attending a little slice of the nation’s pastime can be an exercise in excessive spending.  Tickets aren’t cheap, you could fill in every pothole on Main Street for what it costs to park and concessions nearly require a second mortgage.

Luckily, there are ways to root, root, root for the home team on the cheap.  Here are a few pointers that might just convince the penny-pinchers of the world to get out there to boo the ump.

Sit in the cheap seats. Although tickets are getting expensive, most of the big league teams have one or more cheap ticket options.  You don’t have to drop $80+ for a lower level “look I’m on TV” seat.  You can watch the game from outfield bleachers or cheap uppers for a fraction of that price.  Colorado Rockies tickets start at $9 per person.  You can catch the Oakland A’s for as little as $9.  Even the Yankees have an option for less than $15.  You may have a hard time snagging the cheap seats for popular games–those sell out fast–but if you aren’t too picky, you can get in on the cheap.

Look for special deals. The recession is taking a bat to the ballclubs, too.  Thus, they’re willing to deal.  Almost every franchise has specials.  You can get four tickets with concession vouchers on the cheap.  There’s one night of the week with special low-price tickets.  There’s a special day where they have a better than usual deal.  Visit your local team’s website to find out what kind of deals are going on with your home team.  Also, look for special prices for those who purchase tickets online.

Tailgate. If you eat out in the parking lot, you can pay Costco prices instead of concession prices.  Bright your mini-Weber and grill up some hot dogs.  If you’re a beer drinker, a six-pack from the local liquore store will probably cost less than a single beverage in the stadium, so take care of your imbibement needs prior to entry.  You get the idea.  Bring your own and eat in lot.  It’s fun, too.

Take a bus. Most teams have some kind of shuttle to and from the stadium and it’s often much cheaper than paying for parking and gas.  It might not be compatible with tailgating, but it can be really convenient.

Bring your own. Most stadiums are okay with fans bringing in their own plastic bottle of water and I’ve never seen a woman with a bag of sunflower seeds or a few sandwiches in Ziplock bags booted out of the stadium.  Check your local stadium’s rules to avoid inconvenience, of course, but you should be able to save some bucks by bringing a few of your own goodies.

You hear these horror stories about how it costs $300 to take the family to a ballgame.  It’s possible to do that.  If you’re buying $10 drinks and $8 hot dogs for everyone, it adds up.  With a little planning though, big league ball can be affordable.

Quite frankly, the answer to that question will depend upon who you ask!

David Cornish blames unrestrained capitalism and exessive greed.

Gaynor Borade sees a link between oil price spikes and the onset of recession.

Tejvan Pettinger argues that tight fiscal policy and fast, unsustainable growth have both led to recession in the past.

Stormy Brain explains why so many people are happy to blame the Fed for recessions.

A Washington University news article maintains that experts blame excessive consumer debt for our current economic downturn.

Love a Recession has three lists of potential causes.  The “mainstream” outlook, the authors personal opinion and other potential causes.  The range from speculation to underwhelming consumer confidence to Satan.  Take your pick, right?

Love to Know has an article with the title, “Causes of Economic Recession” that doesn’t even bother to list a single potential cause of recession.  Instead, it maintains that it’s “difficult to predict the causes of economic recession”. 

Another vote for high oil prices in this video.

How about government spending overseas, inflation and the fear of a recession.  Maybe FDR was onto something with that “the only thing we have to fear…” thing, huh?

Those crazy kids who don’t mind being associated with Lew Rockwell blame excessive government regulation.  No.  Really.

Are you getting the gist of this yet?  NO ONE REALLY KNOWS WHAT CAUSES A RECESSION.

That doesn’t stop them, however, from pretending as if they do have an answer.  Not so coincidentally, the causes they uncover are often linked to specific governmental programs of which they don’t approve on other grounds, too.  

In other words, if someone tells you that George Bush caused the recession, that someone probably doesn’t have a “W” bumper sticker.  

If someone tells you that the recession is a direct results of government policies designed to promote minority home ownership via subprime lending, you can probably guess how they’d feel about that policy even if we weren’t in a recession.

For every so many people who blame deregulation for the recession, there is at least one person out there who will take the contrarian view that regulation caused it.  

As far as I’m concerned, you can spin the wheel and embrace whichever pet “cause” it stops on, because your causal analysis isn’t going to amount to a hill of beans anyway.  

The more important consideration at the moment is the fact that we’re in a recession and we might wanna think about how to get out of it before too many more people end up losing their jobs and/or homes.

Which is why I’m proposing the Big Omnibus Recession Elimination Solution (BORES).  Basically, it boils down to developing alternate energy sources to reduce the price of foreign oil and our exposure to price spikes while we engage in less restrictive monetary policy and encourage increased consumer spending (but not debt).  We do this while cutting foreign aid to our allies and banning speculative stock trading.  We’ll deregulate all business by drafting better regulations that will make us more recession-resistant, even though we’ll recognize the inevitability of recessions as part of the business cycle.  Oh, we also need to find a way to defeat Satan.

That’s BORES.  And that’s what you end up with if you start believing the various single (or even “one or two”) issue explanations of the underlying causes of economic recession.

The idea of examining the benefits of a recession seems a lot like marveling at the great clown performances John Waye Gacy turned in at various children’s parties, in a way.  No matter how many kids he made giggle, it couldn’t possibly make up for the corpses in the crawlspace.  So it is with a recession.  On-balance, it’s such bad news for so many people that it feels a little unsavory to talk about the upside.  There is, however, a real potential set of advantages to be gleaned from this current economic mess and we should recognize them before we become completely convinced that the we’re approaching some kind of Apocolypse.  

First, if you’re relatively insulated from the economic downturn and have sufficient security to make purchases and/or investments with some element of risk, there are real bargains to be had out there.  The stock market features a slew of undervalued issues (no, I’m not going to provide specific stock tips here) and houses are cheap at the moment.  If you’ve got a little room in your finances or have a great credit score, you might want to go shopping.

Second, the Fed’s efforts at staving off a recession have largely consisted of pushing down interest rates.  So, if you fall into the aforementioned group, you’re going to see lower price tags on major purchases and lower price tags on the money you’ll borrow to make them.  Between these two factors, you can get a whole lotta house on the cheap these days.  Just in case, though, buy something you plan on living in, okay?

Third, there’s a big picture reason to at least partially embrace the recession.  It’s going to clean house.  It will force businesses to become more efficient and will reward creativity and quality while punishing the fat and lazy.  In the U.S., everyone claims to love a free market until they see this part of the cycle.  It’s necessary, though.  It prunes out those who made poor decisions and creates openings for smarter, leaner businesses.

Fourth, sticking with the big picture theme, a recession creates an impetus to evaluate the way we’ve been doing things as a nation.  Sometimes, you can actually learn a lesson or two from the consequences of your bad behavior and this could be such a situation.  Maybe it’s not bad for us to come to grips with the fact that credit overuse/overextension and a pollyannish belief in perpetual growth weren’t the best ways to run our financial houses.  

Fifth, if you take it down to the personal level, this economic downturn can be viewed as an opportunity for a little personal development.  Even if that isn’t really part of the benefits of a recession, it is an opportunity to do something worthwhile.  Look at these lists.  Some of the alleged “benefits” aren’t too impressive, but others do offer some potetial to come out of this mess a better and smarter person than the one who entered it.

I’m sure there will be those who disagree, but I happen to think that periodic contractions of the economy are natural parts of a cycle of growth and correction.  I think that they’re inevitable when you are talking about an economy that retains at least some traits of a true market system.  When things go up, we overshoot and come back to the “right” place.  When things go down, we overshoot in the opposite direction before bouncing back.  

This recession isn’t a good thing by any stretch, but there is some good in it.  You just have to look carefully to find it.