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Strategies & Market Trends : ahhaha's ahs

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To: e2thex who wrote (23923)10/21/2013 1:20:07 AM
From: ahhaha of 24758
 
A liquidity trap results when money velocity drops to zero. You have all that money just sitting there, but few want to borrow it because risk is off the charts. As long as risk rises various financial markets will rise.

Insolvency means there's no money sitting there. It was quietly secreted away while the party was getting louder.

When various financial markets discover they're actually insolvent risk declines rapidly.
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