PAID PARKING.  The big banks are now charging large depositors for the privilege.

Fearful corporations and investors have been socking away cash in their bank accounts rather than put it into even the safest investments.

The giant bank, which specializes in handling funds for financial institutions and corporations, will begin assessing a fee next week on customers that have been flooding the bank with dollars, Bank of New York told clients in a note reviewed by The Wall Street Journal.

The decision won't affect individual savers, who already are stuck with near zero interest rates as the Federal Reserve keeps rates low to support a soft economy. But it is a glaring sign that corporate executives, bank leaders and money-market fund managers are fleeing from risk and hoarding cash as the recovery threatens to peter out.

Professor Krugman sees evidence of a liquidity trap.

I vaguely recall a flat LM curve and a vertical IS curve shifting to the left from macroeconomic theory years ago.  (Does anybody even teach the polar Keynesian and polar monetarist models any more?)

Interesting times, though: if the return on a cash hoard becomes negative, does that change the incentive to put some of that cash into a machine with a small positive expected return?