Choices

How will refinancing mortgages work?

We're getting about $8 billion in new spending stimulus over the first year after we enact the refinance program. But to get that stimulus, we're decreasing wealth by $13-$15 billion. The spending multiplier needs to be more than half again as big as the wealth multiplier for this to provide net stimulus.

It's important to consider the costs of stimulus...and that government spending almost always can be understand as a wealth transfer.