Quote:
Originally Posted by FOG
Tabs,
Not sure what you mean by “It only took 19 Jihadists to NEARLY bring the house of cards down on 911”, in context to either this thread on in general.
S/F, FOG
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The global economy runs on LIQUIDITY. If liquidity drys up, down comes the global economy. Thats why the Fed reduced the overnight lending rate to 1% to keep the system liquid. Thats why we sent 80B to Euro Banks during 911 week, thats why GM dropped the interest rate to 0% financing to keep the money flowing, people buying. Thats also part of the reason why they closed the Financial Markets for a week after 911, to let things cool off. Get it?
Brokerage Houses/Banks make Markets in Certain Stocks. That means they buy them when there is an inbalance of sellers to buyers to support that stocks price level. If the system is swamped with sellers and no buyers, sooner or later the Brokerss/Banks run outa cash to support stock price levels and they can go into free fall after the liquidity drys up. Mutual Fund redemptions, Bank Account withdrawls etc are all part of the same thing.
Now what do U think will happen if another "Big Event" happens...that run on liquidity terrifys them.