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To: ahhaha who wrote (23918)	10/18/2013 12:04:31 PM
From: Lhn5	Read Replies (1) of 24758

A liquidity trap is a situation described in Keynesian economics in which injections of cash into the private banking system by a central bank fail to lower interest rates and hence fail to stimulate economic growth. A liquidity trap is caused when people hoard cash because they expect an adverse event such as deflation, insufficient aggregate demand, or war. Signature characteristics of a liquidity trap are short-term interest rates that are near zero and fluctuations in the monetary base that fail to translate into fluctuations in general price levels.[ From wikipedia Will gold or gold stocks continue to hold up in this situation?

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