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>you can’t cut interest rates below zero Well, he was wrong on that point. >Crazy as it sounds, several of Europe’s central banks cut interest rates below zer

>you can’t cut interest rates below zero Well, he was wrong on that point. >Crazy as it sounds, several of Europe’s central banks cut interest rates below zero in 2014, and then Japan followed. By mid-2016, some 500 million people in a quarter of the world's economies were living with rates in the red https://www.bloomberg.com/quicktake/negative-interest-rates https://www.bloomberg.com/quicktake/negative-interest-rates

throw0101a 8y ago
> Well, he was wrong on that point. He revisits the point: > We now know that interest rates can, in fact, go negative; those of us who dismissed the possibility by saying that people could simply hold currency were clearly too casual about it. * https://krugman.blogs.nytimes.com/2015/03/03/how-negative-can-rates-go/ https://krugman.blogs.nytimes.com/2015/03/03/how-negative-ca... * https://krugman.blogs.nytimes.com/2015/03/06/the-below-zero-lower-bound/ https://krugman.blogs.nytimes.com/2015/03/06/the-below-zero-... * https://krugman.blogs.nytimes.com/2016/02/12/the-political-economy-of-interest-rates-revisited/ https://krugman.blogs.nytimes.com/2016/02/12/the-political-e... The Great Recession was really an "interesting" time for economists: one usually can't run experiments on macroeconomic theories / hypothesis. :)