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To: pocotrader who wrote (149954)	3/6/2009 1:45:32 PM
From: Valuepro	Read Replies (1) \| Respond to of 313641

"Everytime I hear the name Volker I think 21% interest rates." Yep! And every time I hear the name Bernake, I think of an insolvent banking system, and failing stock markets (along with historically low interest rates). In related news, I read that the Bank of England yesterday lowered interest rates to their lowest level in 350 years. Amazing, and what a strange world! Low interest rates are usually a sign of healthy economies, ones experiencing low inflation, healthy growth, and modest-to-high savings rates. This time around, and while we have low inflation/interest rates, we also have bankrupt or nearly bankrupt banks, and almost no lending activity, and monetary easing (money printing). One would think that if there is greater risk in lending during a recession/depression, rates would be historically high to reflect that increased risk, not low as we are experiencing. But I'm not a central banker, nor a trained macro economist, so what do I know!

To: pocotrader who wrote (149954)	3/6/2009 2:25:21 PM
From: Nevada9999	Read Replies (1) \| Respond to of 313641

A retroactive way of thinking of it I guess. Everytime I hear Greenspan, I think 21% interest rates in our future. All the years of Greenspan's low rates and bubbles mean that someone like Volcker will need to clean up the mess. We have been seeing huge economic stimulus for more than ten years during what I think will soon be recognized as the top of the business cycle. As that strategy finally implodes on itself and government tries to cope by exponentially increasing the same strategy there is no likely result other than hyperinflation. A 21% interest rate is negative in real terms if inflation is 22%. Inflation in Weimar Germany or Zimbabwe were in the trillions of percent, so 22 is not a huge number. This may sound crazy, but it would be really easy to make a list of current events that would have sounded crazy a year ago. Volcker was burned in effigy. He didn't do what he did to become a pop icon. He did it because it was what had to be done to avert disaster. Unfortunately, I think we are in a much deeper hole this time around.