I avoid discussing national economic issues at Get Rich Slowly because I am woefully unqualified to do so. However, people keep asking for my thoughts. Today I’m making a rare exception to offer my opinion about three topics that may impact your wallet.

Stock market woes
I spoke with Noelle Crombie from The Oregonian yesterday. She wanted my comments on the stock market turmoil. “What should the average person be doing?” she asked.

I hesitated and then said, “Uh, I’m really not qualified to talk about this sort of thing. I’m just an average guy. I’m not a finance professional. All I know is what I’ve read from books.”

“What would the books say?” she asked.

“Well,” I said, “basically nobody knows what the stock market is going to do. I think it’s important to pay attention to the long-term instead of the short-term. In the long term the stock market has increased.”

Crombie was pleasant and the interview went well, but I’m still nervous at being approached as an “expert” on these sorts of things — I’m the last person who should be giving investment advice or making assessments of the national economy.

(Look for more on this topic on Friday — I have an “Ask the Readers” queued on the subject.)

Economic stimulus package
Even my wife wants to hear my opinion on economics. Kris says I should write about the “economic stimulus package” that our politicians are promoting in an effort to avert a recession. The problem is, I don’t have much to say about it. As you may have noticed, I’m not very political. Also, I’m not interested in turning Get Rich Slowly into yet another economics and politics blog. There are plenty of those already. This blog is about personal finance.

If an economic stimulus plan is adopted, and if I receive any direct financial benefit (in the form of a tax refund, for example), I don’t intend to spend the money. Despite what some politicians and pundits say, I don’t believe there’s anything patriotic about spending. The notion baffles me. The two concepts — patriotism and spending — seem completely unrelated.

Fed rate cut
Finally, I don’t really understand Tuesday’s reduction of the federal funds rate to 3.5%. I realize this move is supposed to help mitigate a possible recession. To that end, it’s a good thing. But didn’t I just hear last week that annual inflation in the U.S. was high in 2007? Didn’t I just see an article at Boing Boing about rising food prices? Won’t lowering interest rates exacerbate these problems?

In the short-term, the drop of the federal funds rate actually hurts my personal finances. I have no non-mortgage debt, so the eventual reduction in credit card interest rates doesn’t help me. Fixed-rate mortgages are only indirectly affected by this move, and I’m not sure if they’ll see a significant drop or not. (If they do fall, we may refinance.) Meanwhile, I know that my savings will be earning less interest. ING Direct is now paying just 3.65%, and I’m sure other banks will follow suit.

Final thoughts
I believe the hysterics of the media do more to damage the economy than anything else. I understand that reporters want to engage their audience, but to do so they employ needless hyperbole. They fan the flames of fear. If you’re living within your means, avoiding common financial traps, and exercising sensible habits, you’ll be fine.

Some of my fellow personal finance bloggers have recently offered their thoughts on current events:

How do you feel about economic turmoil in the news? Like me, do you mostly filter it out? Does it worry you? I’d love to hear more from anyone with an actual economics background.

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