The Shift?

clipped from corner.nationalreview.com Importantly, Bernanke & Company have changed their policy leaning away from inflation-worrying to economy-worrying. This is a major shift. The biggest in several years. And well they should. Banking problems are far from over. The commercial paper market for short-term corporate loans is completely dysfunctional. Mortgage-backed securities and corporate loan packages are still suffering from difficult pricing decisions and very little trading. No one really knows the full problem or the size or who owns what when it comes to the subprime virus. Loan transparency is inadequate. Cash hoarding is everywhere. Investors are flocking to short-term Treasury bills in order to avoid any risk whatsoever. T-bill rates have collapsed all the way down to 3.5 percent. But if investors are putting all their money in government paper, they won't be financing the business sector that makes our free market capitalist economy hum.