A lot of the elites are going out to bat for NIRP. Be vigilant & do not let them normalise negative interest rates in the US. If you don’t like inequality where it is today after a decade of ZIRP, think about what happens when NIRP comes to reduce costs of risks entirely.
NIRP is not normal & do not let anyone normalise it. Ever.
We all will pay for it. No such thing as a free lunch. We will enter something in which there is NO EXIT, well, let’s just say that no one has exited, yet, & don’t know how to exit as NIRP is a doom loop. Yep.
Something else. Look for negative interest rates & their consequences beyond the entire bund yield curve going below zero OP EDS. Do you see them in the FT & key financial journals? No. Do you know why?
George Orwell wrote: the REAL news is what is NOT on the news 👌🏻
Will continue this thread when I have more band-width. Will do something similar to my trade-war one pinned above.
This. Does it say anything about ordinary people. The economy? No.
The abstract says: HOW TO ENABLE NIRP.
What is NIRP for: MAINTAINING THE POWER OF MONETARY POLICY to end recessions.
Really. It says that. To maintain the power of monetary policy 👌🏻
imf.org/en/Publication…
That phrase that the zero bound is not the law of nature by the IMF & repeated by some on twitter. Do u know what is the law of nature when mankind doesn't have rules?
Allow me to quote Hobbes on life before the social contract: Life is solitary, poor, nasty, brutish and short👌🏻
The LAW OF NATURE is NO WAY TO CONDUCT MONETARY POLICY and definitely NO WAY TO WRITE A GUIDE ON HOW TO CONDUCT MONETARY POLICY.
This is not sufficient logic. Thread will continue later. Got Asian economics to deal w/ 1st.
Before I go, he summarized his thesis in this sentence for the 89 pages of how to ENABLE NIRP (I didn't say it, author did). Read this: to MAINTAIN THE POWER of monetary policy in the future to end recessions w/in a SHORT time.
ECB started NIRP in 2014. We're 2019. Define SHORT.
Here is food for thought, since NIRP in 2014, the German economy now shrank -0.1% in Q2 2019. Read that thesis again: To MAINTAIN THE POWER of monetary policy in the future to end recessions w/in a SHORT time.
Winter is here & they have burned all the wood 👌🏻👌🏻👌🏻.
A technical recession is 2 consecutive quarters of contraction so let's see if Q3 is better. But let's ask a basic question for those pro NIRPers:
The ECB has been lowering the deposit rate since that fateful June 2014 from -0.1% to now -0.4% & bund deep below zero. So where to?
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