The Theory Is That If You Take

The World Changes! So We're In A Situation Today Where The Only Policymakers That Have Flexibility Are Central Banks. But They Don't Have The Instruments! So They've Had To Experiment, And The More You Experiment, The More Uncertainty And The Higher The Risk Of Collateral Damage.

Investors Should Invest On What They Know. The Biggest Mistake Is To Invest On What They Don't Know.

The One Instrument That Has Relative Political Autonomy Is Monetary Policy. Central Banks Do Not Need To Go To Congress To Get Approval For An Interest Rate Hike.

The Theory Is That If You Take Interest Rates Negative, People Are Going To Say, "that's A Silly Game! I'm Not Going To Lend My Money To Governments Who Want Me To Pay Them. I Am Going To Go Into The Stock Market Where I Can Get Positive Returns!"

It Is Hard To Imagine That, Having Downgraded The Us, S & P Will Not Follow Suit On At Least One Of The Other Members Of The Dwindling Club Of Sovereign Aaas. If This Were To Materialise And Involve A Country Like France, For Example, It Could Complicate The Already Fragile Efforts By Europe To Rescue Countries In Its Periphery.