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Because we have 9 rate cuts before 0% interest, the ECB is at negative yield and so the BoJ? The fed funds rate was around 4.5% in July of 2007 before the shit
by buttcoinslol 8y ago
Because we have 9 rate cuts before 0% interest, the ECB is at negative yield and so the BoJ?
The fed funds rate was around 4.5% in July of 2007 before the shit hit the fan. We need room to cut interest rates to spur growth when the next recession hits. 2.25% isn't a very big margin.
- JamesBarney 8y agoBecause of the aging of the population and the consolidation of wealth the natural interest rate have fallen quite a bit. And you're right I think that's a big risk for the next recession. But the only way to a higher nominal interest rate while keeping the same real rate is too raise the inflation rate to 3 or 4%.