Very Scary Things

New York Times columnist Paul Krugman wrote in Friday's edition that the credit crisis affecting the nation's financial markets over the past few days "is something that truly scares monetary economists: liquidity has dried up. That is, markets in stuff that is normally traded all the time - in particular, financial instruments backed by home mortgages - have shut down because there are no buyers. This could turn out to be nothing more than a brief scare. At worst, however, it could cause a chain reaction of debt defaults."

//www.truthout.org/docs_2006/081107G.shtml



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