Negative Interest rates

IveSeenTheLight

coastline wrote: »

You'll need to spread your risk and put it under several mattresses...theres women about you know..:D

lol, is the number of mattresses you have dependant on the number of woner "you know"

Lucky man

System

So a bank would be encouraged by this measure to lend more to its customers?

What encouragement will they be offering me to take up this opportunity - perhaps I might require a negative rate of interest too?
And if they have to start paying me to take their money away, what makes them so sure I want to spend it rather than keep it under the mattress and watch the interest come in?

sabretoothtigger

PaulF81 wrote: »

it could be a notional -0.1% rate, i believe the equations do funny things at 0%, all sorts of divide by zero errors etc.

Clifford_Pope wrote: »

So a bank would be encouraged by this measure to lend more to its customers?

What encouragement will they be offering me to take up this opportunity - perhaps I might require a negative rate of interest too?
And if they have to start paying me to take their money away, what makes them so sure I want to spend it rather than keep it under the mattress and watch the interest come in?

Might as well skip to the end game, copy the Chinese and issue currency notes with an expiry date on it like a cheque. Use it or lose it

ILW

And yet they are now putting everyone into workplace pension schemes, because we are not saving enough for our old age.
Do the powers that be have a clue what they want?

stinktankcynic

Yep. They are also chasing people for underpaying tax, but they don't have a grip on the inflation rate they use for boosting benefits etc, inflation for a person, fuel, food, beer, utilities, train fares. Inflation is 7-10% at least. So where does this 2-3% nonsense come from. I don't trust em.

sjaypink

I don't think they do know what they want. I'm not currently filled with confidence about our, or the global, economy.
I think the whole system is so damn fucked - that's a technical term - that no one really knows how to change without causing mass panic and meltdown.
So it's like hooking our decrepit fraudulant old banking system on the life support maching & keep it breathing at all costs because no-ones thought or planned how to cope when it's dead.
Amazing really that all the 'experts' seemed to not see it coming. No more Boom and Bust

sabretoothtigger

putting everyone into workplace pension schemes

Is it not possible to opt out, take a sipp


http://en.wikipedia.org/wiki/We_are_all_Keynesians_now

http://www.youtube.com/watch?v=d0nERTFo-Sk
http://www.youtube.com/watch?v=F7r7l1VG-Tw

ILW

sabretoothtigger wrote: »

Is it not possible to opt out, take a sipp


http://en.wikipedia.org/wiki/We_are_all_Keynesians_now

http://www.youtube.com/watch?v=d0nERTFo-Sk
http://www.youtube.com/watch?v=F7r7l1VG-Tw

The point was that the government etc seem to be sending out mixed messages. Do they want people to put something away for their future, or do they want people to spend the lot and rely on the state? Wish I knew.

grizzly1911

ILW wrote: »

The point was that the government etc seem to be sending out mixed messages. Do they want people to put something away for their future, or do they want people to spend the lot and rely on the state? Wish I knew.

Desperate measures - if they worked in a bank they would be helping themselves.:think:

stinktankcynic

I can understand peoples concerns. As far as savings go, I guess quite a few of us have money in low paying savings accounts and current accounts paying little or no interest. I can see a 0% interest rate first. If that doesn't work then if they go negative, then the first bank to charge the public for holding money will see a run. The natural progression will be lower interest rates, which we are already seeing and banks trying to start charging for accounts. We had a debt crisis, banks lending to the wrong folk, yet the people in power are trying to encourage the same. Madness. Basically, the banks gave out big money, loans, mortgages to people and organisations who could not pay back. They took the bonuses, then went crying to the government when they were near folding. Shocking management, poor risk control, auditing and where was the bank of england and government. There should have been criminal actions, instead we see bonuses for failure, the tax payer and saver picks up the austerity tab, the people who took out loans can take out even more and the whole game starts again.
Giving people free money, benefits more than wages and and screwing workers over is completely wrong. It's as if the ultra rich want to bring down the rest of us.
When the cost of living starts to really rise, then you will be glad you had the money in those low paying interest accounts, because the rainy day will have come. The benefits folk are going to be in for a tough time, jumping through hoops for their keep. The rest of us will be lucky we had jobs and savings.
The other laugh is that the government wants to encourage business and trade now with the prospect of negative rates, yet recently they gave that train contract abroad. The government should, but won't encourage new industries to compete with foreign countries, they would rather build train lines, roads and schools and bail out the banks. Mad isn't it.