> They can't loan it out again because no one wants to borrow that much. Which is why this is a signal that the economy is failing. The underlying behavior whi

> They can't loan it out again because no one wants to borrow that much. Which is why this is a signal that the economy is failing. The underlying behavior which drives the value of currencies is that the currency is being used. If people just stockpile cash then the value of that cash is eroding as people find fewer uses for it. Since the productive use for debt is as an engine for growth, if there isn't anybody looking to secure debt for growth then we're seeing the long-term effects of a loss of dynamism in the economy, which is detrimental pressure on the underlying economy itself. It's not sufficient to try to persuade people to spend more on consumption (people are always incentivized to consume) - people need to be incentivized to take risks for growth, which they currently are not. What the central banks will realize is that you can't incentivize people to take risks by holding a financial gun to their heads - that only incentivizes people to seek further safety. You need to, perhaps paradoxically, make it safer to take risks. If the ordinary control for doing so (reducing interest rates) isn't working, then there's a compounding factor which is preventing that safety from being felt.