I like to follow the views of Bill Gross, the bond king who manages a trillion-dollar fixed income portfolio out of offices in Newport Beach, California. He is not only a fellow Duke University alum, but also an avid card player. In his biography we learned he almost became a professional gambler after graduating rather than an investor.

Gross made some very interesting comments this week in his monthly report to shareholders, and I’d like to share them with you. He mentions ruefully that "America is for sale, and there is fear and trembling in the auctioneer’s voice. We are to the point of fearing fear itself." And he adds, "credit markets are based on trust and when there is no trust, markets can freeze up."

The bond manager goes on to observe that average Americans know little of the ways of Wall Street, and how could they, when even people like him—and myself for that matter—are constantly struggling to catch up and learn about complexities of things like overnight repos, credit default swaps and why some banks are saved, others are cut in half and still others are left on the side of the road to go bankrupt.

He then goes on to give a great analogy for the seize-up of the credit markets, which was offered to him by Mohammed El-Erian, his partner at the firm. "Imagine yourself at the drive-thru ordering a Big Mac. At one window you order and pay, at the other—20 feet ahead—you pick up your lunch. What if you thought that after paying at the first window, your 1000 calorie sandwich might not be waiting for you a few seconds later. You might not pay; business as usual might not take place. That is what is happening in the credit markets. They are frozen in ‘McFear.’"

Gross observes that after the failure of Lehman Brothers—an investment bank which took orders at one window, and promised to pay at another for trillions of dollars of those CDS, swaps, and other derivative "sandwiches"—institutional investors said that they’d prefer to stay at home and have peanut butter instead of risking their money ordering a Big Mac. And so their money goes into that figurative mattress instead of the register at McDonald’s, people are laid off, profits go down, bank loans become less available, and our economic center cannot hold.

The credit king thus goes on to recommend that the Federal Reserve start to buy commercial paper—the short-term credit that allows American businesses to function, as we have discussed many times—directly. He believes that would put a floor under the credit market, and allow trust and confidence to flourish again.

I agree, and increasingly it appears as if the Fed does too, as there were news stories after the bell today that indicated the Fed might be willing to do exactly as Gross suggested. If that comes to pass, investors would cheer and we would at least get that short-term rally that the market’s heavily oversold indicators are promising. Stay tuned.

This article was written by Jon Markman, contributor to InvestorPlace Media. For more actionable insights likes this, visit www.InvestorPlace.com.