Nice purply prose. TWIST is designed to flatten the yeild curve, lower longer dated treasury yields, and make borrowers less risk averse when making long term capital bets. TWIST however wont change anything with respect to the credit markets and how bank stocks respond. Rates are already too low. And it does not matter if 30 year mortgages go to 3%, borrowers will not be able to meet lenders' standards for credit. The CEO of Fifth Third was on Bloomberg yesterday..."We have a lot of capital and are willing and ready to lend it to CREDITWORTHY BORROWERS." That is the issue...no matter how low the rates (and I think absolute borrowing rates will not come down, just the UST benchmarks...spreads will widen) there is still a strucutral problem in the economy. Banks need to be induced to lend. The best thing right now is to end the practice of paying 25bps to reserves held on deposit with the Fed. In fact, the Fed should behave the EXACT same way the commercial banks do with their depositors' money, instead of paying interest on deposits, the feds should charge a fee to warehouse the banks' reserves. This would induce a small amount of the capital to be put to work in new loans. And the banks have $1.5 trillion on deposit with the fed. There are two entities holding back an economic recovery: (1) our elected officals who are unwilling to face the reality that our spending is unsustainable and (2) our financial system that was made fully solvent by future taxpayers' largesse but is now unwilling to lend out the money we gave them except on terms that guarantee large profits for the lender. When we fix these two things the unemployment rate will drop and things will get better. The banks share prices may fall as their risk adjsuted returns go down, but frankly, too many banks are still in existence right now that shodl have failed in 2008...and the phony economy we now live in has simply propped them up.