Negative interest rate
UPD Or a tale about how banks are trying to preserve the function of money.Recently in Denmark, mortgage borrowers received their first payments from banks - a reward for ... using a loan.
It sounds strange, but the premium for using the loan is a direct consequence of the fact that the central banks of some countries set negative interest rates several years ago. Banks and borrowers are still trying to get used to the fact that the interest rate on a loan can be -0.0562%, for example, like the Danish Hans-Peter Christensen, writes the Wall Street Journal (translated by Vedomosti).
In the last quarter, the Dane received 249 kronor ($ 38) from the bank. “My parents said that I have to hang this receipt in a frame to prove to future generations that this really happened,†says Christensen.
With the help of negative interest rates, central banks are trying to stimulate the economy by making loans more affordable. Such measures have already been taken by the European Central Bank, Bank of Japan, Switzerland, Sweden and Denmark. For the last three, negative rates are not just an economic stimulus, but a means to adjust the exchange rate of national currencies against the euro.
https://geektimes.ru/post/274536/
An interesting situation has developed in the world of economics. Even Karl Marx predicted in capitalism the tendency of the rate of profit to fall. But even Marx could not imagine that percentages could turn negative.
The EU has already introduced a negative interest rate to stimulate the real sector of the economy. Banks will have to pay for keeping their reserves in vaults. Deflation has set in in Europe. This is not beneficial for the authorities, they need inflation so that citizens feel a tendency to depreciate money, and they, in turn, must invest it somewhere. But since citizens decided to invest mostly in deposits in banks (purchasing power has decreased since 2013), they had to withdraw money from banks so that they would start spinning continuously, and depositors would not lose their money (under the OPS policy). Gold prices also had to be increased (upd: for a short time)
The United States has long been pursuing a policy of lowering the interest rate. And she's almost at zero. The aim of lowering interest rates, as in the EU, is to create an impulse for economic growth. However, the targeted lowering of interest rates encourages the creation of a speculative demand for assets. Demand for debt is high, while real interest rates remain negative. Negative government yield bonds leads to a decrease in interest payments on government. debt.
By the way, it is already 60 trillion.
Perhaps we are living in historical times, gentlemen.
Cool. Toka understood almost nothing.
Like, hinting that I'm rotting?
What did you want? After all, capitalist dogs. Truncated them little. Popular krovushki.
"Like, hinting that I'm rotting?"
If I directly said that they are rotting, that there will be a default soon, then I would be given 9 Kisilevs out of 10. It is necessary that many countries abandon the dollar, then this statement would be closer to the truth.
Let's just say it's a bell that things are bad in the internal economies of Western countries. There have never been any negative interest rates. And they have to get out, to be in the golden mean between inflation and deflation.
I don't quite understand how the interest rate can be lower,
this should lead to an immediate outflow of dough from the bank and poisoning to the Chinese People's Bank
and the bank will bomb and whoever does not have time to evacuate will suck.
MunchkiN 616
The rate on deposits, which was introduced by the Central Bank of Europe in early June, is negative: -0.1%
The rate on loans is still positive, now 0.15%
In short, now banks either lend to other banks or pay by keeping their savings ECB ... Citizens do not suffer yet, but anything can be ...
Chaos began in the Swiss foreign exchange market. Their rate is now minus 0.4%. On the 15th, it was -0.372%.
https://www.finam.ru/international/newsitem/shveiycariya-trexmesyachnaya-stavka-libor-opustilas-do-rekordnogo-minimuma-20150115-15480/
Franc went up after decoupling from the euro. Apparently, big problems are outlined in the EU.
Wild Rider
And what is interesting, complete silence about the fall of the Euro!
No one in Europe should change Euro for Dollar in exchangers =)
The Bank of Japan has introduced a negative interest rate on new deposits that Japanese banks place with the Central Bank. This measure should stimulate economic growth
Read more at RBC:
http://www.rbc.ru/finances/29/01/2016/56aaf54b9a79471b775fe329
"After the Bank of Japan took an unexpected step last Friday and introduced a negative rate, on the debt market the country is experiencing a sharp decline in yields. "
http://www.vestifinance.ru/articles/66906
At the moment, the Central Bank of Sweden, Switzerland and Japan adhere to a negative rate. What's next? USA and their new QE4?
Wild Rider
A year and a half ago you wrote that "things are bad in the internal economies of Western countries." Well, how are they doing there now? Probably those who took out loans in rubles cry bitter tears?
stalker7162534
So, in your opinion , what is happening in Japan is normal? To be perverted so that there is inflation and economic growth is already a symptom of a serious illness.
"So how are they doing there now?"
If we take global trade as a whole, and not individual countries and their markets (we need to understand more there), then in 2015 a decrease in demand for many goods was noticed. The blogs have already written about the PC market. Raw material prices are at multi-year lows.
Plus, experts appear with such statements. http://www.telegraph.co.uk/finance/financetopics/davos/12108569/World-faces-wave-of-epic-debt-defaults-fears-central-bank-veteran.html
Wild Rider
I am not a strong expert in economics, it is difficult for me to judge how to regulate processes so that production does not stop - as it was during the crisis in the thirties. Then production stopped, people were fired because goods were not sold, because people were out of work and did not have money to buy goods (appreciated?).
With regard to world trade. I entered "World Trade 2015" into Google.
"In 2015, the growth of the world economy according to a new forecast will be at 3%, the OECD predicted back in September, and 2.9% As in 2016, it dropped from 3.6 to 3.3%."
The key word - growth.
In modern civilization, the concept of a crisis has changed, now a crisis is when GROWTH slows down. That is, as before, in the new year they produce more than they produced in the past. But I wanted to produce even more. But it didn't work out. Here (in a modern, developed country) it is not far to the resignation of the government, since its management only led to the fact that in the new year they began to live better than in the past, but too "little better."
Spoiler: This is not a decrease in GDP with GDP.
http://demotivators.to/media/posters/1474/37701074_ya-byi-znal-chto-otvetit.jpg
stalker7162534
"(appreciated?)."
Well, this is one of the reasons for the VD given by you. There are several of them on the wiki. There, most likely, a lot worked in the complex. However, we will not know this anymore.
"The key word is growth."
Well, of course. Without growth, everything would be bent completely. There would be stagnation.
"But I wanted to produce even more. But it didn't work out."
The capitalist system has its boundaries, its own growth potential, without creating more and more new industries for development. In schools, universities, they teach economic cycles (see Juglar), but this does not always explain the true causes of crises. After the 30s, Caseianism became very popular in the United States, where the state could intervene in the economy. But the trick is that adherents of this model have always done something, that is, they reacted to changes in the economy, but this happened either too late or early, i.e. were out of step with economic cycles.
Of course, anything has happened over the past 100 years, but the crises have become more frequent lately, starting from the Asian 97th year. This should already signal something.
Perhaps at this stage, a certain "redistribution" is taking place, and capital according to the planned scenario will run to China, Southeast Asia, BRICS in order to "build up" its consumer there (for which, I think, it is not worth explaining). And, by the way, the decrease in rates to the negative zone is quite favorable to this.
"This is not a decrease in GDP with GDP."
))) Well, this is not about our economy, this is generally a separate conversation.
Negative interest rates imposed by central banks in Japan and several European countries have affected more than 500 million people and a quarter of global GDP, according to analysts at the rating agency Standard & Poor's (S&P).
In their opinion, the introduction of negative rates is "a sign of central bank despair," which will then lead to "unforeseen consequences." The S&P believes that the practice of setting negative rates will increase risks and put pressure on central banks, which are already frightened by the unfavorable political situation in the world.
According to S&P, such rates have already negatively affected the yield of bonds, as well as the activities of insurance and pension organizations due to a decrease in investment inflows.
Recall that in March this year, the European Central Bank (ECB) lowered the base rate from 0.05% to 0%, and the rate on deposits - to minus 0.4% from minus 0.3%. The loan rate was reduced from 0.3% to 0.25%. The same percentages were introduced by some European states that are not members of the EU, as well as Japan.
http://www.banki.ru/news/lenta/?id=9164659&r1=rss&r2=common&r3=allnews&utm_campaign=twitterfeed&utm_source=twitter&utm_medium=referral
Royal Bank of Scotland (RBS) will start charging interest on a number of large corporate clients on Monday on deposits, reports the Financial Times. RBS will be the first UK bank to introduce a negative interest rate on deposits for its customers.
http://www.vestifinance.ru/articles/74088
Now banks in Western countries will cease to be not only a means of income (for deposits, but not for loans, which is funny), but also a means of storing money. The social sphere is being cut. If only this impulse to invest in the real economy did not cause hyperinflation.
Wild Rider wrote:
Deflation is in Europe. This is not beneficial for the authorities, they need inflation so that citizens feel the tendency to depreciate money, and they, in turn, must invest it somewhere. But since Citizens decided to invest mostly in deposits in banks, the purchasing power of the currency still decreased, they had to withdraw money from banks so that they began to spin continuously and they could keep their value. Gold prices also had to increase.
Dude, you don't understand what you are writing at all. You wrote 2 opposite sentences, which you type to prove one to the other.
The interest rate must correspond to the country's economy. If now, with a worthless economy, the interest rate is sharply lowered, then the value of the ruble will fall due to its easy availability, and the exchange rate against other currencies will collapse even more. This will lead to the fact that sellers of raw materials will drive even more resources for sale abroad, because it will be more profitable for them to sell for dollars, which will cost a lot of rubles. Fewer raw materials will be supplied to the domestic market, so the price for it will rise (and so will the price of fuel). And with the price of fuel, prices for everything will rise. Well, with the depreciation of the ruble, it will be more difficult to buy something abroad. In general, there will be an economic disaster.
sundyray
"must invest them somewhere"
In the real economy, not in bonds, I mean.
"The purchasing power of the currency has decreased anyway"
Here is my jamb, the reason (not the consequence) of the behavior of citizens had to be indicated in parentheses. Those. purchasing power declined before deflation began.
I don’t understand, I already need to buy cereals and canned food or the world's financial tycoons will rule everything?
LenivyiBob
We must wait for the elections in the United States, then we will see what their economic policy will be. We are not threatened by the FOPS, but nevertheless the influence will be on us if the FOPS is introduced in the USA.
-DENIMUSS -
This is not about our country.
Wild Rider
Wild Rider wrote:
should they invest somewhere "
In the real economy, not in bonds, I mean.
And how should it be? Citizens come to a real plant and invest money in a crack in the fence?"
Or do citizens do it differently? For example, they give money under the obligation to return this money at a profit - that is, the citizen dumps the money, and he is given a document (paper) from which it follows that this citizen ........ "has the right to receive on behalf of the issuer (issuer bonds) within the agreed period of its face value in money or in the form of other property equivalent. Also, the bond may provide for the right of the owner (holder) to receive a percentage (coupon) of its face value or other property rights. " (Wikipedia, Bond)
Spoiler Here I opened a topic in which I was going to explain economics issues on my fingers, but it was deleted.