Hard evidence of liquidity trap

Discussion in 'Wall St. News' started by gastropod, Sep 17, 2010.

  1. I would expect the money accumulating in personnel accounts to start making an exit at some point, either in the form of being invested or spent on good/services.

    Either way it bodes well for the bull-case.
  2. Notice the flight from retail money market funds. Some of these large MM funds have been able to 'supplement' the normal lending system. Now that folks are fleeing MM's, this important source of loanable funds is contracting. Also, bank reserve balances at the fed are way up and sticking. Money creation isn't keeping pace with the de-leveraging that's going on...not yet at least.