Would you buy something in 2009 at its 1694 price?

As if we needed further confirmation of the virtually unprecedented nature of the world's economic slump, the lead story in the Financial Times tonight is about the venerable Bank of England cutting its interest rate to 1.5%, a 315-year low. The thinking is that if someone offered you a change to buy something you use regularly at its 1694 price level, you would jump at the chance.  That's exactly what the British government is doing, much like its American counterpart, the Federal Reserve, and it is finding few takers.

The failure of monetary policy alone to reverse the declines comes from the dark side of this mess.  There are dozens of sub-crises trickling down through the economy: the collapse of the real estate bubble (sure, we call it that now, but anyone using the "bubble" word 36 months ago would have been branded an alarmist or paranoid), the stock market meltdown, volatile energy prices, evaporating credit markets, and so forth.  All of these intertwine to create a psychological context such that there would be few takers even if the world's central banks paid us to take the money.

What does this mean for your organization, even if it is far away from the center of the financial universe: the craziness is going to go on for a long time.  Get ready. Stay ready.