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> Their world will go down in flames but everything else will likely continue as normal. > These opportunities still exist, the financial world of central banks
by samsonradu 7y ago
> Their world will go down in flames but everything else will likely continue as normal.
> These opportunities still exist, the financial world of central banks is (these days) unrelated to this.
It's not unrelated at all. It's the central banks policies that are pushing the economy out of balance. These policies obfuscate the real risks that come with investing, like defaults and money-losing investments. Greece, a country close to default a few years ago and with a debt-to-GDP ratio of 180% in a currency it cannot print manages to have a 10Y yield of ~2%.
Not predicting any doomsday but I believe in the upcoming years EU banks will slowly push the negative interest rates down to consumers, as they have no alternative. Their business model of borrowing-short and lending-long is no longer sustainable.
Also, on the long run, these policies have the effect of shrinking the middle-class, increasing inequality and polarising societies.