http://en.wikipedia.org/wiki/Deflation
http://en.wikipedia.org/wiki/Liquidity_trap

I’ve heard noises that the Fed is thinking about lowering interest rates 1/2 a point…again. The availability of money isn’t the problem; it’s fears of the economy getting worse. Lowering rates again only encourages this fear, devalues the dollar further, and takes away the only brakes the Fed has. Once the interest rates (now already lower than inflation was) hit zero, the Fed is out of monetary policy options. If deflation then continues because of withheld demand and withheld credit to the point that it is no longer profitable to produce things, we will be in big trouble.

Personally, I hope that the economic theory is wrong and this is just a (long overdue) natural correction that will finally put the equilibrim price where the market dictates (lower), as opposed to where the government thinks it should be (high). http://www.dailyreckoning.com......008/09/22/

Warren Buffet (who lately suffers from a bleeding heart) has lost $16 billion dollars since he tried his own stimulus investments. His Berkshire Hathaway has lost 30% share value and his $5 billion Goldman Sachs investment has cost him $2 billion so far. How can such an intelligent investor not get that the market is being raped in Congress? And why is he rallying it on by urging bailout money?
All I know is I’m taking a long drive this weekend to feed the fish.