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An Advertising Stimulus

Jordan J. Ballor


Posted by Jordan J. Ballor
on Monday, April 28, 2008

One sector of the American public that hasn’t missed out on the government’s purpose for the economic stimulus package is the advertising and marketing industry. Savvy marketers are targeting sales and special offers to the federal rebate checks, which start to go out today.

One sector of the economy especially banking on how people will spend their stimulus rebates is the automobile industry. Here, for instance, is a local car dealer’s ad specifically targeted to the stimulus package:


I’ve seen another major car ad that is currently running nationwide featuring the advice of an economist to a young car buyer. The young buyer is presumably saving a great deal of money on the new car through a special cash back incentive or zero-percent financing or some such other offer. What should the buyer do with all the money he’s saving? Go out and buy something else?

No, says the wise economist. Save it or pay off credit card debt. Of course, the economist doesn’t give the really solid advice, which would be to forgo buying a new car in the first place and taking on all that new debt. Dave Ramsey, a guru of financial stewardship, consistently exposes the lie that financing the purchase of a new car, no matter what the incentives, is a good use of money. As Dave notes, it’s no coincidence that the financing arms of automobile manufacturers are generally among the more profitable aspects of the business.

It’s no surprise that auto sales are often an economic bellwether, since new car payments are typically one of the easiest things to put off in tough times. These are also precisely the kinds of payments that folks facing credit card debt and dwindling savings accounts should be looking to avoid when spending their stimulus rebate.

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