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Negative interest rates may as well spark questions as to how f*ed up a system can be until it implodes and what happens then. Seriously, if they truly were ne
by dmichulke 12y ago
Negative interest rates may as well spark questions as to how f*ed up a system can be until it implodes and what happens then.
Seriously, if they truly were negative, we could all stop working now, borrow some money and live of the proceeds.
IMO, the story that CBs know what they do and are there for our own good is not believed by anyone anymore and the future will teach us a lesson of sorts that will prevent us from repeating such lunacy for hopefully at least a few decades.
- mdemare 12y agoNegative interest currently only applies to a few banks and governments. The goal of the central banks here is to get people to spend/invest their money instead of saving it.
- fche 12y agoSee also https://www.youtube.com/watch?v=JUvm9UgJBtg https://www.youtube.com/watch?v=JUvm9UgJBtg
- jrs235 12y ago"The goal of the central banks here is to get people to spend/invest their money instead of saving it." Because otherwise who will pamper and serve the central bankers and politicians if we're allowed to live free off our savings?
- pjc50 12y agoCentral banks generally have a very narrow remit: they're not political agencies. Most central banks have inflation targets. Inflation is low due to lack of economic growth. The only tool they're allowed to use is interest rates, and to some extent QE. Hence ridiculous schemes. Negative rates for bulk low-risk lending are a result of the collapse in borrowing. If retail rates are 1-2% and there's a 3% overall risk of default, that turns into a negative rate.