Monday, Sep 28, 2015

Nordic experimentation with sub-zero interest rates has changed the way central bankers think about

Telegraph: How Sweden's negative interest rates experiment has turned economics on its head

It has long been believed that when it comes to interest rates, zero is as low as you can go. Who would choose to keep their money in the bank if they had to pay for the privilege? But for the people who control the world’s money, this idea has recently been thrown out of the window. Many central banks have pushed their rates into negative territory and yet the financial system HAS YET TO COME TO AN ABRUPT END.

Posted by libertas @ 12:00 AM (3502 views)
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10 Comments

1. libertas said...

Was QE negative rates by default? Now that the ice is broken, will central banks dabble in negative rates and then plunge in rather than do more QE?

Sunday, September 27, 2015 11:02PM Report Comment
 

2. cornishman said...

"...the financial system HAS YET TO COME TO AN ABRUPT END"

YET - is the operative word.

Monday, September 28, 2015 11:31AM Report Comment
 

3. hpwatcher said...

Zzzzzzzz

Monday, September 28, 2015 12:11PM Report Comment
 

4. icarus said...

I thought the financial system CAME TO AN ABRUPT END in 2008 - to identify just one of history's many financial crashes (in addition to many financial crashes to debt-peon governments in the Third....er.....Emerging Economies....World. And it's a lot easier for the financial bandits to suck wealth out of real economies, and keep the debts in place, with US/UK/EU/Japan governments and IMF, World Bank etc. on board, imposing austerity and rolling over non-payable debts. And manipulating markets. And playing 'pump and dump' with asset prices.

Monday, September 28, 2015 12:34PM Report Comment
 

5. icarus said...

Oh, I failed to read between the lines. This is a post about paper gains on properties in North London isn't it?

Monday, September 28, 2015 12:47PM Report Comment
 

6. libertas said...

Reading between the lines, rates are just as likely to fall as they are to rise, and all those saying that rates going up is a done deal are bluffing or ignorant, whilst many on fixed rate mortgages are being mis-sold and defrauded by people who have no financial adviser licence.

Monday, September 28, 2015 03:02PM Report Comment
 

7. icarus said...

Talking about 'coming to an abrupt end' the possibility of government, financial and economic collapse in the US under a mountain of debt is summarised in: http://www.counterpunch.org/2015/09/23/waiting-for-collapse-usa-debt-bombs-bursting/

Monday, September 28, 2015 05:38PM Report Comment
 

8. quiet guy said...

"rates are just as likely to fall as they are to rise"

Just for once I find myself agreeing with Libertas.

"many on fixed rate mortgages are being mis-sold and defrauded"

Think of it as insurance. If I sold you property insurance and your house doesn't burn down, did I defraud you? You've just agreed that rates might rise as well as fall so the only remaining question is if the fixed-rate premium is good value or not.

Monday, September 28, 2015 06:44PM Report Comment
 

9. libertas said...

Quiet Guy, the defrauding is from the Bank of England, who have been threatening to raise rates, on behalf of the banks, to trick people into artificially expensive fixed term rates. The Federal Reserve have been playing the same game. Reality is, they have no control over rates, and rates are going down.

Wednesday, September 30, 2015 10:12PM Report Comment
 

10. mister ed said...

@8
"Think of it as insurance. "

Yes, that's about the nub of it for most people.

Thursday, October 1, 2015 08:39AM Report Comment
 

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