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Negative interest is a return to the origins of banking. You would pay a bank to hold your assets. What you got in return was the convenience of not worrying of
by trgn 5y ago
Negative interest is a return to the origins of banking. You would pay a bank to hold your assets. What you got in return was the convenience of not worrying of getting robbed, or being able to transfer large sums across large distances with bank notes. imho - that was the proper way to think about savings. If bank patrons want to see interest on their savings, they should convert theirs to capital and actually invest it, with all the responsibilities and risks that entails.
- raxxorrax 5y agoThat isn't applicable since the bank invests my savings already and doesn't just keep it in a safe. It could also mean that any amount you borrow would result in you paying back less. It would be a negative interest rate...
- SonicScrub 5y agoIt's completely applicable if the returns the bank can make are less than the operational costs associated with storing your money. The offered interest rate is going to be some function of the bank's operational cost subtracted from the bank's investment return. When interest rates set by fiscal policy are so low that the bank can't make enough through investing deposits to offset the operational costs, negative interest rates must occur.
- selfhoster11 5y agoWe don't chisel bank balances on stone/clay tablets anymore, or guard it with spears. Securing and transferring money should be much cheaper than it used to be millennia ago.
- akomtu 5y agoToday banks don't store anyone's money, they store a virtual database, ideally replicated a few times. For a bank, storing a trillion isn't any different than storing a million. There's a tiny per-account expense because it's a, well, a separate entry in the database.
- TheGigaChad 5y agoGo suck dick.