Negative interest rates threat to Europe's financial stability

Negative interest rates threat to Europe's financial stability - Business Insider



From the article, and, by the way, this could happen throughout the world if we don't get more economic activity:

Negative interest rates erode the profitability of the banking
sector and pose a threat to financial stability. In exchange, they offer
an economic stimulus that is mild at best and that has actually been
seen to backfire in some regions. The world economy is once again
navigating in uncharted waters.

The article goes on to show that holding cash gives a nominal rate of zero even though inflation may push the real rate to negative. But once the nominal rate goes below zero, there could come a time when people no longer want to use banks and when banks no longer want to use central banks!



The result of this happening over time in the Eurozone is that the Eurozone banks are underperforming, hurting the economies there. And some banks in Switzerland have tried to offset loss of interest rate income by imposing higher mortgage rates!



So, the solution for many is to get rid of cash altogether, so that the negative rates can be forced upon the depositor.  That would not be implemented easily, so banks will be slowly bled to death. Therefore, a return to positive rates in Europe and Japan is very important to the health of banks and of the economies affected.





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Negative rates are here to stay - Business Insider

Negative rates are here to stay - Business Insider



A Citibank analyst warns that negative rates in Europe could stay for years. Wake up Americans because the longer they hang around the greater chance of a cashless society happening:

In our view, ongoing inflation
undershoots and a continuing readiness of central banks to pursue
currency weakening (or at least the avoidance of an appreciation) as an
integral part of their pursuit of their inflation targets or dual
mandates suggest that the recent trend towards (more) negative policy rates is likely to continue.

Indeed, negative policy rates are likely to become a regular feature across many countries in coming years and we suspect that policy rates could fall further, perhaps significantly further, than our current forecasts suggest.
Recent developments in financial markets and the greater risks to the
global growth outlook raise the likelihood of more and deeper policy
rate cuts across a range of countries.

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Negative interest rates destroying Japan's money markets - Business Insider

Negative interest rates destroying Japan's money markets - Business Insider



Money markets are going to be disbanded in Japan as you break the safety with NIPR, Negative Interest Rate Policy.  This is a disturbing destruction of paper assets that investors have relied on for years.





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JP Morgan How Low Can You Go Negative. - Pay Cash Only Movement

In case anyone believes that negative interest... - Pay Cash Only Movement





This article is very troubling. JJP Morgan is on board not just for low interest rates, but for very low negative interest rates on bonds. Beware of totalitarianism creaping toward America. Once negative rates spiral downward deeply, cash will have to be eliminated. This is madness, folks.





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Larry Summers 100 Dollar Bill Ban And Westfalia Lost | Talkmarkets

Larry Summers 100 Dollar Bill Ban And Westfalia Lost | Talkmarkets



This is the article introduction on Talkmarkets: Westphalia as a concept is superior to empire. Our freedoms are more likely to be honored in a system of national sovereignty. Larry Summers
is attacking that sovereignty as a representative of a global financial
system.



From the article:

 

Empires colonize. Empires oppress the subjects. Empires force banking
solutions on the people. Can anyone deny that a Westfalia-like
sovereignty is at grave risk of destruction in Summers' and Kissinger's
New World Order?

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Authorities Want To Ban High Denomination Bank Notes | Talkmarkets

http://www.talkmarkets.com/content/global-markets/here-is-the-real-reason-why-authorities-want-to-ban-high-denomination-bank-notes?post=85777&uid=4798



Getting rid of a major portion (30percent) of the money supply appears to be the real goal of the Eurozone! It has nothing to do with fighting crime, although that is the stated reason. This is just another battle in the war on cash. Tyler Durden says this on Talkmarkets:

...if overnight the €307 billion worth of €500 bills were
eliminated, the notional value of the entire amount of European physical
currency in circulation would decline by 30% to €700 billion!

This, of course, can help set the stage for more aggressive NIRP, negative interest rate policy, and the war on cash continues. 





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Gary Anderson Blog | Swedes Are Saving More Than Ever As Negative Interest Rates Fail | Talkmarkets

Gary Anderson Blog | Swedes Are Saving More Than Ever As Negative Interest Rates Fail | Talkmarkets





From the site I wrote:

Swedes are saving more than ever in their newly created (voluntary)
cashless environment. That was not supposed to be how it works. They
should be saving less and spending more because the banks are charging
them interest. That is the goal of negative interest rates, to force
people to spend more so that inflation will bump off zero.

But here is the flaw in that reasoning. The fees the banks charge
retail customers are like a tax. They make the Swedes feel poorer in
their accounts, not richer. So the Swedes do what I predicted. They save
more to make up for the shortfall. They still don't want to hide money
under the mattress, risking the loss of all of it to theft!



The illogical reasoning that people will spend more when you take
their money away from them must have been created by people who have
plenty of spare money. No one else would entertain this absurd reasoning
except for economists and bankers!

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