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Strategies & Market Trends : 2026 TeoTwawKi ... 2032 Darkest Interregnum
GLD 385.99+1.6%Nov 12 4:00 PM EST

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To: Haim R. Branisteanu who wrote (64805)7/20/2010 7:01:42 AM
From: carranza23 Recommendations  Read Replies (3) of 217739
 
Exactly why I don't think the Fed is going to engage in QE2. All the easing in the world won't be effective if the money is not going to be lent.

It is not being lent because banks would rather have the moolah as reserves for bad loans, which are huge. They won't do so until there are genuine signs of a real recovery and borrowers are credit worthy. In other words, not anytime soon.

Helicopter Ben is learning that his helicopter won't take off, even if loaded with money, because the pilots - the banks - refuse to fly.

Fed needs to somehow provide incentives for the lending of money. Otherwise the recovery will be delayed significantly. The other side of the coin, stimulus, is now politically dead.

Krugman is going nuts.

On the other hand, we are undergoing a painful deleveraging whose ultimate effects should be very good as the growth will be organic and genuine, not stimulated.
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