The banks aren\u2019t lending. And despite what you have heard, they probably won\u2019t start just yet….<\/p>\n
Sure, there are some positive signs that the credit market is opening up a bit: Libor rates, the price at which banks lend to each other, have crept down in recent days, greasing the wheels of capitalism, or at least what\u2019s left of it. Some banks, like JPMorgan Chase and Citigroup, actually made loans to banks in Europe on Friday. These are all important steps on the way to a recovery.<\/p>\n
But make no mistake, the banks are doing the opposite of what Henry M. Paulson Jr., the Treasury secretary, sought when he virtually demanded that they accept the taxpayers\u2019 money: They are hoarding it. It\u2019s a bit like the government\u2019s sending out tax rebate checks and the consumers\u2019 not immediately running out and spending them.<\/p>\n