This would be a disaster.
Comments?
It would be a major policy reversal, and hence a major loss of face, for Janet Yellen. So, I don’t expect it to happen, at least not this year.
Didn’t Japan start doing this just last week?
Maybe we need to wait a few fiscal cycles to see how it works for them. But that would be ‘long term thinking’, something many American investors are reluctant to do.
They’ll follow Norways action of banning cash first. Even Germany is looking to limit cash transactions.
Eliminate cash. Force everyone to use banks. Negative interest rates and govt monitoring of every penny.
Just more Big Gov wealth redistribution.
And they wonder why people are not saving money – spending it instead.
Well, if a modest rise in interest rates can cause the market to tank, then negative interest rates should make it go up. N’est-ce pas?
obama may be feelig regret that there’s so little left of the economy to destroy, coupled with an overpowering desire to render fresh, new havoc.
Before he’s out of office, you’ll be living in a packing crate and wearing an empty barrel to work.
Savings? Why bother! If you’ve got anything put aside, the inflation of printing up money to finance obama’s Marxism will deflate the value of savings to zero. You might just as well stack it beside the porcelain facility and use it for personal hygiene.
Pension? Hahahahahaha....
Healthcare? Wait in line to see the untrained and unqualified Health Flunkey.
The good news is that you can wait in line to pick up a new pair of shoes free of charge every two years, courtesy of The State. The bad news is that they’re made from cardboard and only last six months, provided you DON’T wear ‘em.
Hope you like Spam - luncheon meat is all there is, comrade, and you’ll wait for hours to get your weekly ration.
Not to worry, though - obama and the family get away from all the mental strain with taxpayer-funded holidays for two or three weeks every six months, and stay at the world’s most luxurious hostelries with the money you thought you’d earned to feed your family.
Taxes, inflation, money printing still not enough to steal the sheep’s money.
Is negative interest rate really the term.
Interest is positive by nature. Never supposed to go below zero.
They are charging you to put money in the bank or wherever.
Doesn’t sound like “negative” interest, sounds like a fee
My first thought was that negative interest rates would drive money from banks into the stock market, equities being the only means of capital appreciation. I don’t see any disaster there.
In the case of Japan, where corporations buy each other’s stocks, a phenomenon known as keiretsu, selling these stocks is sort of insulting to the boards of the companies being sold. As a result there aren’t that many stocks to buy and the markets are extremely volatile. Japan makes for a hard case study.
Perversely, it seems negative rates, per the article, have boosted savings, not driven spending. Worried about making it through retirement, people of a certain age began to spend less, not more. The demographics would be important here as an aging society might be bad grounds for negative interest rates, but a youthful one might be just right.
Yes, yes they are. Because you see, the little people, the citizens, are too stupid to be trusted with their finances. Therefore, the government, along with the wise financial class, will take that money from you, for the common good of course.
The banksters and their cronies in government are just salivating at the prospect of turning the US into their version of chinese communism.
And of course, the FRee traitors will be along shortly to tell us how exporting all of our industry and commerce to a communist nation is so good for their bottom line.
Well, hear this: if you deal with the chinese, you should be slapped with tarriffs until you crumble. If your’re one of the assholes that sold out to communist slave labor, and totally fucked over the domestic market and stacked it in your favor, I have no sympathy for you.
My idea, if you do business with china, pack up your business and move their, and let you be subject to their laws. Yes, I mean literally kicking out and making ex-pats of Americans who choose to deal with the communist chinese. You want your third world slave labor, we’ll make you choke on it.
Yet the 30 year mortgage rate is above 3.5%.....
Agree. Total disaster. ZIRP has already punished savers with effectively earning nothing for their money. Now they want to start confiscating money from anyone with a savings account? That would start an avalanche of withdrawals to the 1st Bank of Sealy.
Ask yourself the simple question “what Fed policy would be best for Democrats?” That is what they’ll do.
Nothing big will happen until Obama is out of office. He has so many minions in the federal bureaucracy they will wreak havoc if a republican wins.
Add that to paying people not to commit crimes.
We live in the United States of Calligula.