My belief is that economics needs to be broken down into the smallest piece to the individual US citizen. What works for an individual should work for the economy as a whole.

To date the US government has taken the position that the government needs to fill in the demand holes with stimulus by borrowing money. If the US government borrows 1.5 trillion dollars and then spends it into the economy through stimulus, this “growth” in the economy (gdp) should bridge the gap according to the current powers.

What if an individual did the same thing as the US government? Okay so Suzy gets a pay cut and the she decides to adopt the same philosophy as her government. Suzy takes her credit cards and decides to go on a spending spree matching her lost income. Suzy does not just use her credit cards to pay current bills, but she also uses it to redo her kitchen. Suzy lost $30,000 in pay, but she spent $30,000 on her kitchen and other none essential items to make up for the lost income. Did Suzy make up her lost $30,000 in income? Is her situation better after spending the $30,000? Did she reduce or increase her risk?

The answer to the above questions seems relatively obvious to me. If you lose income a budget is the solution not a spending spree. If 70% of the US economy comes down to the US consumer, shouldn’t our rules be their rules?

I am reminded of a common movie scene where the characters are climbing up a mountain to get to safety only to find a seemingly endless set of mountain ranges. The risk with declaring an end may be the straw that breaks the camel’s back. Can we take the double dip? What happens to the US consumer if there is another bout of mass layoffs.

There is no short of predictions for the future equally positive and negative. The current momentum seems to rest much of the world recovery on emerging markets and a weak dollar. Stimulus in the US has failed to create a meaningful impact on unemployment and the credit market has shrunk even with the massive bailouts last year. The US housing market has been kept on life support with government supported interest rates and tax rebates. My real concern is that nothing that has been done really is sustainable. Over the past year the US government has thrown money at everyone but its tax payers. Maybe the real solution is to let us spend our own money and when I say “us” I mean everyone regardless of income.

Interesting that Washington DC over the past years seems to have become just as disconnected to Main Street as Wall Street. Has Wall Street moved into Washington? Over the past year I have had discussions with many people who have lost their jobs or had a pay cuts, not one of them ever mentioned healthcare as a major problem right now.

Happy Thanksgiving! The Emerging Market of Dubai’s possible credit problems may give a new meaning to Black Friday or just another straw on the camel’s back.