3 ms·
Well thats because bonds are in many cases less risky than holding cash.. in the EU “cash” in a bankaccount is only guaranteed up to 100.000 euro.. bonds are gu
by martin_bech 7y ago
Well thats because bonds are in many cases less risky than holding cash.. in the EU “cash” in a bankaccount is only guaranteed up to 100.000 euro.. bonds are guaranteed for full value in most cases.
- mpalczewski 7y agoThat's interesting. In that case cash in a safe would be the better option. You still have negative carry(insurance, rent, security, etc.), not sure how that would compare to the negative yielding bond. Hmm, if enough did this and put it together in some vault and perhaps lent some fractional amount of this money if an appropriate opportunity presented itself you might even make money on this. I just described a working banking system. Makes me wonder how banks could even be solvent in this environment. Are they just regulated into existence. It all sounds like a house of cards at this point.