Once in a while, someone is just telling it like it is...this video is one of those moments
0% interest rates is madness even if you think it's boring...
I know that most people have their eyes glaze whenever they hear the word "interest rates" and it's a shame in my opinion. If there is one thing that is most important than anything to understand when it comes to economics...that is it in my opinion. When the cost of capital is 0%, how does one make good judgement on where is the best use of capital?
The chickens will come home to roost . We cannot run an economy on tweets and sms alone.
The surest sign of an unsustainable financial bubble is the distorted market for sovereign debt. There is a “going out of business” sale in process for fiat currency. Trillions in fiat currencies - and the world’s money managers are looking for somewhere to put it. In a world of limited options, they tend to put it where they CAN, rather than into productive uses that a growing economy would offer. Bonds are at the end of a 40-year bull market which has pushed bond prices to all-time highs and bond yield to all-time lows. Stocks too... Almost every market and asset class that’s big enough for major institutional investors is at or near its all-time high.
I have to say 0% is not interesting at all.
I see what you did there.
@cryptoctopus: I suspect that 0% and near 0% interest rates will be here until job creation > automation. Which could be forever.
I completely support you on this. Money is just an entitly. We can provide world much more better things. Nice post @cryptooctopus
A price signals information about a commodity's supply. When money is free, beware.
The rate of interest is the market price of risk. In the zero interest rate world, the market loses the ability to distinguish high risk from low risk in many financial assets. Clearly this is a nonsensical situation, and it's likely to end very badly...
I think most people understand interest v inflation rate. so, when they see 0% they know they are buying power and they don't care.
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