Reason #9: The Fed can't do it either

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Reason #9 the economy won't recover in 2010Historically, the Fed has lowered interest rates to spur spending and investment.

Well, the Fed has already cut interest rates to banks down to essentially zero. The media are screaming about potential inflation due to the trillion dollars the Fed put into the system, but that trillion has simply replaced the trillion written down by the banks, which have another trillion and a half in write-downs to go.

What's more, the banks are hoarding cash to rebuild broken balance sheets rather than lending it to people. This will continue in 2010 and beyond.

In the meantime, here are seven ways you can hedge against inflation.

Next: Reason #10: Take a good look around

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Last updated: February 09, 2010: 04:39 PM

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