3 ms·
Do you also believe negative interest rates, larger than people are facing now in spite of a wave of inflation, are almost all upside for everyone?
by eliasmacpherson 5y ago
Do you also believe negative interest rates, larger than people are facing now in spite of a wave of inflation, are almost all upside for everyone?
- imtringued 5y agoYes, negative interest rates encourage long term thinking. Lower financing costs will result in less cost push inflation for manufactured goods and services. They remove the need for a post capitalism system. They most likely would have stopped the great depression and prevented world war 2. They reduce inequality by forcing rich people to spend and invest their money instead of sitting on it during times of economic uncertainty.
- eliasmacpherson 5y agoSo are you in favour of both abolishing physical cash and negative interest rates? (larger than now, how big a negative interest rate are you in favour of? Nevermind: I see from your other comment, 5%, immediate bank run territory.) You realise lower financing costs do the opposite of encouraging long term thinking. The inflation cost is merely moved to deflation cost of cash. What do you mean by a post capitalism system? You realise that hyperinflation contributed to WW2, and that in the event of negative rates the rich move out of cash into another asset(like housing). See Roosevelt and the gold standard. I honestly doubt that negative rates would have avoided the Great Depression. Wealth taxes also reduce inequality and can be more progressive than negative interest rates which hit middle income earners the hardest, who try to save for retirement.