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> If so, this would seem to be a pretty clear argument for wealth re-distribution Negative interest rates are wealth redistribution. Keeping money in account w
by tathougies 7y ago
> If so, this would seem to be a pretty clear argument for wealth re-distribution
Negative interest rates are wealth redistribution. Keeping money in account would cost more money, so instead, you are forced to lend it out to people who need it (presumably poorer) for less money in the future. Thus the rich who have lots of cash lose money and the poor, who need cash, can use their cash, start businesses, and have to do less work to make their business profitable, after paying back the loan
- dragonwriter 7y ago> Negative interest rates are wealth redistribution. So are positive interest rates, just in the opposite direction.
- tathougies 7y agoSure, but the commenter was asking if negative interest rates indicated that we need wealth redistribution from rich to poor. Also, in the recent past, we have had a negative 'real' interest rate. You'd be hard-pressed to find funds paying more than inflation on your cash.
- cheez 7y ago> you are forced to lend it out to people who need it (presumably poorer) for less money in the future This will never happen.
- tathougies 7y agoUm what? Negatvie interest rates already exist in some european countries and exactly this is happening.
- cheez 7y agoIt will never be lent out to poor people.
- deleted 7y ago[deleted]
- tathougies 7y agoIt will be lent out to people who can pay. If poor people can't then they won't, but I mean, it will be lent out to people less rich than the ones lending. That may mean middle class too. Still transfers from upper to middle are indeed wealth redistribution.