Quote from lloyd111:
by taking aim at the real problem...the insurers!
Cut rates all you want the banks are not lending out the coin,why because they are afraid their insurers will not be able to meet their current obligations so therefore they will not add to the problem with writing more loans.
Bush leagues stimulus plan to put dollars in the average pocket amounts to a hill of beans,first they need to print the money to give out and once it is out to the avg joe what good would it do when the money is given back to big oil or retail or some other service.
Problem underpinning this market is one of confidence from the banking sector to their insurers.
Bush plans 150 billion,why not go 250 bln and buy the insurers book of biz,guarantee .50 on the dollar for bad debt and clean the slate.
This would allow the banks to get a fresh start and lend money,this ends the credit crunch and adds confidence ,now the rate cut would make sense too.
My two cents fwiw.
Lloyd
