What if we spent every penny?

By Shirley Skeel

Editor's note: This is the first in an occasional series on financial what-ifs.

From May to July, Americans will receive more than $100 billion in tax-stimulus checks. Individuals will receive up to $600 and a family of four as much as $1,800. In recent polls, people said they would spend only 18% to 40% of it.

But what if every penny of that $100 billion were spent this summer, jolting the economy exactly as lawmakers intend?

Wide-screen televisions would fly off the shelves. Wal-Mart, Best Buy and Walt Disney would think it was Christmas all over again. Tens of thousands of teenagers would get summer jobs. And for a few months, U.S. economic growth would surge to twice the rate expected. And then fall, possibly on its face.

What would people spend it on?

Some marketers argue that an $1,800 check handed out during hard times will look rather like "unhappy" money from a dying aunt. People will feel they have to spend prudently on boring things like groceries, gas and the broken dryer.

Other researchers argue this will look like "free" money. And most people, aside from the needy poor, will want to splurge.

"You give an $1,800 check to the average guy, and it's going to look an awful lot like a wide-screen TV set to him," said David Wyss, chief economist at Standard & Poor's in New York.

And wouldn't you know, a run on televisions is predicted by BIGresearch of Ohio. The polling company says that in March, soon after the stimulus plan became official, the number of people planning to buy TV's hit its highest level in at least six years. BIGresearch senior analyst Pam Goodfellow says that with gas prices up, people are "cocooning" at home with their TVs.

Certainly the "free money" theory seems to have legs. Once the summer sun arrives and spirits are buoyed by the Olympic Games and some vacation, people could well live it up a little -- that is, assuming gas prices, banks and housing have stopped blowing up.

In that case, we'd have a run on hot new items and other little luxuries where there is pent-up demand, says Susan Sterne, president of Economic Analysis Associates in Connecticut. That would mean a jump in sales of:

• iPhones, BlackBerrys, GPS systems and notebook computers at top sellers Best Buy, Wal-Mart and Circuit City.

• The bright spring dresses still sitting on the racks at Wal-Mart, Kohl's, JCPenney and Macy's.

• Back-to-school kids' clothing and shoes and shoes at Wal-Mart, Payless and Target.

• And sneakers, swimsuits and summer sports goods from, yes again, Wal-Mart, Dick's and Sports Authority.

So Wal-Mart, which attracts more than one shopper in 10 in each of these categories, would be a sure winner, adding a few billion more to its $345 billion annual sales.

Taking a vacation is also in people's stimulus-spending plans, according to a National Retail Federation survey. That's good news for Disney World, Six Flags, Las Vegas and hotels and restaurants.

Continued: What $100 billion does to the economy

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