http://www.billcara.com/archives/2008/04/daily_report_for_wed_apr_16_20.html#more

I have no doubt that the Fed will continue to work closely with Humungous Bank & Broker, particularly Lehman, Merrill, Citi and Wachovia as these banks leverage down, and recapitalize. I do anticipate further downside action, probably spikes like we saw in mid-March should there be a sudden credit market crisis. But, more likely the Fed is on top of it and what the market will see when short rates spike lower is that the Fed buys the garbage loan paper of these failing banks to support them. That will send the USD lower and commodity prices higher, which ultimately will sink the equity market. Coming soon there will be a reversal in rates as the Fed will be forced to raise them to stem the explosion in food and energy costs, and that will cause the rising trend in bond prices to reverse. At the point of reversal, the first leg of the Trade of this Generation will occur, which is to sell bonds. The stronger USD will hammer down precious metals, for a time – quote me: “A Brief Time” – at the end of which, we will complete the second leg of the Trade of this Generation, which will be to buy Precious Metals and Metals.