It is a short-term measure. I don't think any country can have negative interest rates over a long term.
Beyond a point, the economy stops responding to monetary policy.
Topic: Negative Interest Rates - page 3. (Read 2403 times)
http://www.bloombergview.com/quicktake/negative-interest-rates
Are Negative Interest Rates an end of fiat monetarism? What effects do you believe this monetary gamble causes in short- mid- or longterm?
Lets's discuss.
I have a whole slew of problems with ZIRP, and especially NIRP:
1) Savers are very much hit under NIRP. NIRP makes it harder for anyone saving money to get ANY income off their savings. Bad!
2) NIRP will very possibly (probably?) lead to banning CA$H! .gov will then get to see EVERYTHING you buy. Do you like that?
3) ZIRP and NIRP (especially NIRP) cause all kinds of weird perversions (eg, incentive to pay bills faster)!
4) Lack of proper CA$H will encourage OTHER digital currencies, Bitcoin may get discouraged or BANNED.
Those are just off the top of my head...
NIRP is very bad, to my knowledge we have not seen this before in modern history.
Maybe banks will build big forts to store money. 
It's just a matter of profitability, if building and keeping the fort functioning is cheaper than the interest rates they could do it.
It's just a matter of profitability, if building and keeping the fort functioning is cheaper than the interest rates they could do it.
Well it's sort of case to case basis according to the country of origin. If there's is a deflation then the harm is lesser than what it looks but if there's inflation going on and they decide to go with negative interest rates, then the effect would be instant and both short and long term users/investors will surely face some harm but mostly the short term since the long term investors get to adopt to the changes in the long run and are affected less.
http://www.bloombergview.com/quicktake/negative-interest-rates
Are Negative Interest Rates an end of fiat monetarism? What effects do you believe this monetary gamble causes in short- mid- or longterm?
Lets's discuss.
Jump to: