Hi, Trout.

My apologies for not having seen, and answered, this earlier.

I guess, I just haven't checked out this board in a while (not that long, but "a while" any way).

Actually, lowering rates hasn't really done a great deal to force those with investable funds to invest.

Moreover, it has done exceedingly little to increase lending institutions (especially regional banks) lending.

Now, the last step would be to force the banks to lend.

Regionals are a tad ticked in that FDIC insurance rates have increased due to no fault of their own, rather, due to those "too big to fail" and the crap that they have, and continue, to pull(ed). And, they will be pulled kicking and screaming in to the lend, lend, lend abyss.

If you force banks to pay a slight percentage of what they can take, but don't, from the discount window ... I believe that one or two things will happen.

Being a firm believer in O'Malley's Corollary to Murphy's Law (Murphy was an optimist) ... probably the latter.

This could literally force banks to lend. Perhaps, to small businesses and home builders (large and small). A goodly amount of that lending has been drastically curtailed during the past four years.

This could cause economic expansion, business growth, and lead us all into the great Pacacea Land.

On the other hand ...

Banks cannot find any worthy borrowers. Being charged for holding exess (excess?) reserves, they (lending institution) have to pass these charges on to their depositors (hey, without depositors, they're ain't no reserves, right?).

People pull money out of the bank and seek some place, where at the very least, they aren't charged.

Inflation, risk and mass economic upheaval.

Gotta remember O'Malley's Corrolary to Murphy's law.