(no subject)

[randomness]

Societies do not function without trust.

What is happening now in the markets is what happens when trust--between banks, between companies, between people--disappears.

Nearly fourteen months ago, I posted about fear and suspicion being bad for markets. What I said is just as true now as it was then.

But when trust is gone, how do you get it back?

Comments

[chain saw with a magician (from livejournal.com)]

We've created another generation that will never trust these institutions again, and probably rightly so. Those of us who are old enough to be paying attention to this are going to become like our laughable grandparents - burying gold bullion in the back 40. The next generation of children will grow up trusting banks, getting their 10% compound returns, and laughing at us just as we laughed at our old relatives who lived through the Great Depression. Then they or their children will learn the same lesson again.

Here's a different answer. Trust in the markets begins to get reestablished when the questionable assets become so cheap that they're worth buying JUST IN CASE the promisor comes through.