What's required, according to many analysts, is a circuit breaker in the transmission mechanism of fear.
The transmission mechanism from interest rates to consumer spending is weaker, largely because of less developed and less competitive mortgage markets.
But there is good reason to believe that the transmission mechanism is at least partially broken at present, and thus the pass-through benefit to the economy associated with a small decline in Treasury yields (relative to current levels) would likely be infinitesimal.
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If the fundamental disease is that individual eurozone countries have borrowed too much or are still borrowing too much, then the transmission mechanism making whole economies sick is the fear that banks possess too little capital to absorb losses that may arise if these country fail to repay all they owe.
Indeed, an important element of the monetary transmission mechanism works through the asset price channel.
The mechanism of transmission is thought to have been the prion.
On a side note: It is my hope that the Federal Reserve could find a way to use the funds received from the Term-Deposit facility program and re-purpose them through a different transmission mechanism that reaches the broader economy.
The financial crisis has bunged up that transmission mechanism.
So there is a clear transmission mechanism from increasing fears about the ability of Italy to repay what it owes to the perceived strength of France's balance sheet.
Embedded inside it is a batteryless RF switch, and the way it works is that upon the release of the spring mechanism inside, a tiny bit of power is generated for the 2.4GHz RF transmission ( ZigBee compatible), and whatever device is connected to the RF control outlet on the other end will receive the on or off signal.
ENGADGET: Mitsumi exhibits micro-vibration power generator and batteryless RF switch (video)
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