I think its the sign of a broken system. Paying people to loan money just shows that they have no room to grow the economy with this system and that they're just letting it implode.
In South, Africa savers get about 5.9% and it costs around 10% to get a loan, not saying our system is the greatest by any means but it makes more sense to sort of encourage saving and not loaning.
I think a lot of investors holding negative yield bonds will eventually dump and try to put their money in precious metals and emerging markets bonds because well anything is better than no return.
I think the Western economy is going to go through some of the biggest changes with the next crisis looming and we'll all follow but emerging markets with the least debt to GDP will recover much faster and it could bring about a whole new global economy.
I had no idea that savers still get a decent interest in SA.
Wow, 5.9%, that was normal when I was a kid on my little saving account.
Always calculate interest minus inflation =risk +reward on money.
Inflation is 4.5% there and its much riskier
That is true, our currency has been heavily inflated over the last few years and the buying power is nowhere near what it was, lol thats why I came to crypto
So each year I assume you're interest rates kept dropping until now negative? That's insane, do Dutch people even bother saving or do they rather invest in things that give a return like property, stocks, pension etc?
5.9% is the standard base, the larger your sum saved you can get up to 7.2%
Most funds simply don't see good investments and park their money, when many do the same you get negative yields.
They believe that a small negative yield in a save government is better than buying in to a bubble. Clear bubbles are again in the real estate, stocks, almost all resources are on a new high.
Negative yields are simply the first signs of panic and classical banking is on its way out. Let's hope this process won't be a repetition of 1931.
Thanks for the breakdown. I guess thats why precious metals are looking like a better investment so you can at least hold your value. Yeah stocks, real estate, student debt, car loans are all massively inflated there's pretty much nowhere to go for investors either you're parking, holding precious metals or looking at emerging markets that have some sort of opportunity
While I know a recession will be disastrous for many since so many people live paycheque to paycheque it will be interesting to see how it works out now that we have crypto as an alternative.
The previous GFC birthed BTC can the next once kick off major adoption?