[nicola_tesla]

A rate cut does nothing when the person who wants to borrow can’t pay back the loan.

What you are witnessing s a deflationary spiral. At some point it will stop, but I’d say there’s a long way yet to go. Study up on the Law of Mean Reversion.

http://www.generationaldynamics.com/cgi-bin/D.PL?d=ww2010.weblog

[bruinbirdman]

"What you are witnessing s a deflationary spiral."

Cash is king? For how long?

yitbos

[dennisw]

What you are witnessing s a deflationary spiral.......

Characterized by loaning billions to banks but the banks cannot and will not lend it out. They don’t like the parties that want to borrow. Don’t have enough confidence in them

Which is a 180° turn from the real estate mania where banks made mortgages to anyone with a pulse including illegal aliens

[supercat]

Study up on the Law of Mean Reversion.

BTW, one thing I've not seen discussed much is that rising prices of assets should be seen as a red flag to investors telling them to stop investing in those assets. Instead, they're seen as a red flag to bulls, telling them to charge ahead.