The tax rebate checks have begun to be direct-deposited and mailed. For those eligible, look for $600 per adult and $300 per child. That’s a lot of cash. Let’s say you’re a family of five: you’re looking at a check for $2,100. But will it really stimulate the economy?

Let’s ask it another way. Are we really in a recession? A recession, technically speaking, is two consecutive quarters of a contracting economy. We haven’t seen that yet. But don’t try telling that to the American people. They overwhelmingly believe we’re in a recession despite evidence to the contrary. Certainly we’ve seen record high gas prices, and some food items have gone through the roof. But if we do find ourselves in a recession, it’s a self-inflicted one on so many levels.

Let’s look at the housing market, for example. People are now pointing angry fingers at Alan Greenspan for keeping the Fed’s key rate so low coming out of the 2001 recession. By keeping this rate low, this indirectly meant that mortgage interest rates were low. This allowed a lot more people to buy a lot more house than they’d ordinarily be able to afford. Let’s compare and contrast the last seven years to say 1982. In 1982, a 30-year fixed-rate mortgage was running around 18 percent. Coming off the 2001 recession, a 30-year fixed rate mortgage was around 5 percent. On a $200,000 home, that would mean a payment at 18 percent of $3,014 per month. That same $200,000 house at 5 percent runs you $1,074 per month. It’s easy to see why so many people were getting bigger loans.

Now comes the downside. Not only were more people getting loans, but real estate prices were shooting up. Banks began to loosen their standards a bit so more people could get a piece of the American dream. What happened is we had too many people getting into too much house and into neighborhoods they had no business buying into at their income levels. It’s not hard to see how those loans starting falling apart.

Not only did these loans fall apart but they helped devalue the real estate around them. When you have to sell your home at a fire sale, all of a sudden your neighbor’s home is worth less because you’re an idiot. I’ve seen home prices in my neighborhood double in the last few years, but now they’ve begun to adjust downward to a more reasonable level. This so-called housing crisis is only a crisis for those in foreclosure, which is relatively few of us.

Yes, I know we’re at record-high levels of foreclosures, but we’re talking about roughly 1.5 million. There are about 800,000 foreclosures in any given year anyway. That translates into less than 2 percent of mortgages in foreclosure. Let me put it another way. More than 98 percent of us don’t have to worry about foreclosure, yet we’re allowing all this foreclosure news to spook us.

If we do enter a recession it’ll be because we have been talked into it by those in the mainstream media. It’s all psychological. So is the notion of rebate checks. They won’t have any real effect on the economy but the psychological effect could be tremendous. Most of us are better off than we were five years ago. If we need a rebate check to make us feel more secure, then that’s fine with me.

I’m never one to argue when the government wants to give us some of our money back.