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Isn't that also why economists think excessive inflation is bad? Because it undermines the "time value of money"? So to avoid inflation, instead of printing mo
by klipt 7y ago
Isn't that also why economists think excessive inflation is bad? Because it undermines the "time value of money"?
So to avoid inflation, instead of printing money, we lower interest rates.
But once interest rates go below 0, that also undermines the time value of money.
Oops.
- zaroth 7y agoLower rates cause increased inflation. Rates are lowered by increasing the price of bonds, by buying them, e.g. "printing money".