what are the wonders of the anchor text , let's look at the logic as to why anchor text would/should have such a dramatic effect in the Google rankings for your keyword phrases and what exactly “appropriate” anchor text is..... please post in your views for the same :rolleyes:

There is no current effect on your page ranking as Google does not rank your page based on your anchor's. Google base your ranking on your relevance in your content and many other things that are not related to how many anchor you have with the keywords that you want to target rather I will give you exactly the formula for good pagerank:

PageRank relies on the uniquely democratic nature of the web by using its vast link structure as an indicator of an individual page's value. In essence, Google interprets a link from page A to page B as a vote, by page A, for page B. But, Google looks at more than the sheer volume of votes, or links a page receives; it also analyzes the page that casts the vote. Votes cast by pages that are themselves "important" weigh more heavily and help to make other pages "important."

To validate this please go to the source:
http://www.google.com/technology/
Take a look at the PageRank Explained section.

There is no current effect on your page ranking as Google does not rank your page based on your anchor's.That's a misunderstanding of the kind that leaves people obsessing over PageRank while wondering why they're not ranked well for their targeted queries.

The paragraph you quoted refers specifically to PageRank, which is just one small element in how Google approaches ranking. Anchor text is absolutely another part of it.
let's look at the logic as to why anchor text would/should have such a dramatic effect in the Google rankingsWhy would it? Because that's the way the algorithms are written. :)

Why should it? Because it's one effective way to evaluate the relevance of the citation from the linking page, as well as to confirm that the page being ranked is itself relevant to the query in question. It's also useful in determining the respective sites' importance as authorities on the query topic or (and perhaps 'and') as hubs referring to on-topic sites.

Anchor text content is an important part of every web information retrieval system, including Google. Evaluation of anchor text is in effect the web IR implementation of citation analysis, and its effectiveness in that role is well-established, tested, and documented. There's no approach to ranking that would be completely resistant to manipulation, but anchor text analysis (which involves, at Google, much more than simply matching the content of the anchor text to the content of the query) can be quite hard to manipulate or "spam." Which is why questions like "what exactly is “appropriate” anchor text?" come up.

In short, they use it because it works.