Janet Yellen Says Negative Rates On The Table "If Outlook Worsened"

Zero Hedge ^ | 11/04/2015 | Tyler Durden

[SeekAndFind]

As the market now diligently calculates the suddenly surging odds of a December rate hike, here's Yellen with a preview of what will happen once the rate hike cycle is aborted...

• YELLEN SAYS IF OUTLOOK WORSENED FED MIGHT WEIGH NEGATIVE RATES
• YELLEN SAYS NEGATIVE RATES COULD HELP ENCOURAGE BANKS TO LEND

... just as it was aborted in Japan in August of 2000 when the BOJ also decided to send a signal how much stronger the economy is by hiking 25 bps, only to cut 7 months later and to proceed to monetize not only all net Japanese debt issuance a decade later, but to hold half of all equity ETFs.

The good news:

• YELLEN SAYS SHE DOESN'T SEE NEED FOR NEGATIVE RATES NOW
• YELLEN SAYS FED SEES ECONOMY ON STEADY PATH OF IMPROVEMENT

Because when have the Fed's forecasts before ever been wrong.

[dynoman]

Trump on Yellen yesterday; https://youtu.be/ZSlXkOX6n3s?t=1890

Carl Icahn on Yellen; https://www.youtube.com/watch?v=Mba7SynRtVA&feature=player_detailpage#t=753

[1raider1]

B-B-But, an increase in the prime interest rate is “Right around the corner.” Maybe NEXT quarter, or so they have said ever since January 20, 2009. Obama would crash and burn if rates are raised. It won’t happen until a Republican is in the White House.

[WENDLE]

This is madness

[Cowboy Bob]

What were Yellen’s qualifications again?

[Purdue77]

Negative Rates? Is that where they give our money back to us?

[Paladin2]

Kill the
derivatives.

[Rodamala]

Dear dumb bitch... when Cost of Living increases are higher than the prime rate, we are already at negative interest rates. Someone, somewhere, at some point (after a Republican is elected as President, no doubt) is going to have to admit that things are pretty bad.

[RinaseaofDs]

Her chromosomes match (XX)

[from occupied ga]

Negative Rates? Is that where they give our money back to us?

I think that's where they charge you interest for the privilege of letting them use your money.

[Jolla]

Am I to understand this right, I will not make any money if i put my money in the bank, but, if I have a lot of cash and can get a loan, they will pay me?

[RckyRaCoCo]

This is deliberate.

[House Atreides]

I’m holding out on refinancing our mortgage until we can get a mortgage with negative interest rates.

[CodeToad]

Negative rates, meaning, “We steal your money out of your bank accounts.”

[I want the USA back]

If a bank gives you “negative interest”, it should be reported as such on the “1099-INT” form that they send to you. Then the IRS should charge you a “negative tax” on that amount.

[windsorknot]

Negative rates? How does that help those who put their money in savings accounts and CDs?

[DannyTN]

The Fed is doing what it can to shore up the economy. But it’s a blood transfusion when we’re hemoraging.

What the economy needs is the restoration of the import tariffs so we quit losing jobs and industries. Or at least balanced trade agreements. We need Trump for the cure.

[jpl]

I guess this means they’ve decided to stop pretending rates will be going up soon?

[citizen]

On the lower graph, wouldn’t the Fed Target Rate blue line shorten by one year if you go back in time year-by-year?

IOW, the Fed has been predicting the same take off in interest rates for 5 or 6 years. Hasn’t happened yet.

[PAR35]

No, it’s basically a storage fee for your deposits at the bank. Say you have a $10,000 savings account. They might charge you $10 a month. The goal being to get you to take your money out of the bank and to buy something with it. That would help the Chinese factories.