Pavlov's Sheep

In Pavlov's research, he discovered that if he gave sheep a mild electric shock, it would bother them very little and their life would go on pretty much as if nothing had happened as long as the shocks were random. Warning the sheep in advance of a shock by ringing a bell, however, affected their behavior and it changed radically. The sheep were just smart enough that if they heard the bell, the shock was coming. After repeating this exercise a few times, the poor sheep lost control of bodily functions and after a few more warning bells, they started dying of heart attacks.

With fears about a rising core inflation rate and slowing economic growth, Bernanke and the Fed understand too much money was printed up over the past decade. They are not alone. The Central banks in Europe are raising rates and Japan is just beginning.

Last night China's Central Bank Vice Governor Wu Xiaoling was quoted as saying, "We will remove the firewood from under the cauldron so that banks do not have money to lend."

Barkly hears the bells ringing

Cash is not trash...especially at 5% and the good news is there is some $4 trillion in savings and money markets in the USA!