2008-12-23 — stockhouse.com
Okay, so 3 trillion is a lot of money. But it doesn't appear to be working. It just gets sucked up by the balance sheets of banks who hold hundreds of billions worth in derivative contracts that now, apparently, have little or no value. Don't fear. There has been an additional 5 trillion earmarked for the same purpose.
Most believe that eventually banks will start lending again and people will start borrowing again, and the game will start all over. To me it is clear that this will never work. My reasons are that psychology has already been impaired and will not be repaired until two preconditions have been met:
1) Enough time has elapsed for people to forget about the crazy speculation of the past 2) Asset prices fall by a large enough degree that they reflect the average person's ability to purchase them with the fruits of their labour
We also get a shout-out in this article. Much thanks (though the link is wrong).
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