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Old 08-07-2019, 08:35 AM   #21
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Quote :
...
Highlights from Jim Bianco at Bianco Research.

Key Points
  1. Negative debt topped $15 Trillion today on Monday, up over $1 Trillion in two business days.
  2. Negative debt is now 27% of all developed country sovereign debt, a new record.
  3. Negative debt now 44% of of all developed countries excluding US sovereign debt.

Excluding US


...
https://moneymaven.io/mishtalk/econo...Uq-WwxI8jTUhw/

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Old 08-09-2019, 08:59 AM   #22
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The head of the Reserve Bank has told Parliament that all options are on the table to stimulate Australia's economy, potentially even cutting interest rates to zero or negative levels and implementing unconventional policies such as quantitative easing.

This week, four countries — New Zealand, India, Thailand and the Philippines — cut their official rates, with more nations expected to follow over the next few weeks.

That follows the first US Federal Reserve rate cut in more than a decade at the end of July.
...
https://www.abc.net.au/news/2019-08-...again/11399576

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Old 08-09-2019, 04:03 PM   #23
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In Denmark’s $495 billion mortgage-backed covered bond market, another milestone was reached on Wednesday as Nordea Bank Abp said it will start offering 20-year fixed-rate loans that charge no interest.

The development follows an announcement earlier in the week by Jyske Bank A/S, which said it will start issuing 10-year mortgages at a coupon of minus 0.5%. Danes can also now get 30-year mortgages at 0.5%, and Nordea recently adjusted its prospectus to allow for home loans up to 30 years at negative interest rates.

“It’s never been cheaper to borrow,” Lise Nytoft Bergmann, chief analyst at Nordea’s home finance unit in Denmark, said in an email. “We expect this to contribute to driving home prices higher.”

Though good news for homeowners, Bergmann said the development is “almost eerie.”

“It’s an uncomfortable thought that there are investors who are willing to lend money for 30 years and get just 0.5% in return,” she said. “It shows how scared investors are of the current situation in the financial markets, and that they expect it to take a very long time before things improve.”
https://www.msn.com/en-us/money/news...ory/ar-AAFtb2Z
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Old 09-12-2019, 07:31 AM   #24
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U.S. President Donald Trump on Wednesday called on the “boneheads” at the Federal Reserve to push interest rates down into negative territory, a move reluctantly used by other world central banks to battle weak economic growth that risks punishing savers and banks’ earnings in the process.
...
https://www.reuters.com/article/us-u...-idUSKCN1VW1CW

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Old 09-16-2019, 07:14 AM   #25
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From last week:
Quote :
...
The ECB cut its deposit rate further into negative territory, decreasing it by 10 basis points to negative 0.5%, while also announcing it would restart its monthly bond-buying program as it attempts to juice inflation and European expansion.
...
https://www.marketwatch.com/story/go...ecb-2019-09-12
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Old 09-24-2019, 07:43 AM   #26
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The cash cow bank lending model is dead, buried by the European Central Bank (ECB).

The coup de grace came at the recent meeting. As ECB President Mario Draghi squeezed the negative interest rate for banks even deeper.

The ECB will restart its bond purchase program in November. This time, without a time limit. Thus, the monetary authorities have permanently chained the long-term interest rate at a low level and cut the profit opportunities of the financial sector to a level that isn't sustainable.
...
"The negative interest rate policy of the ECB is ruining the financial system and is a socio-political poison," says Frank Kohler, CEO of Sparda-Bank Berlin. The financial system is absurd if we have to explain to the children that money has a negative value - and thus debt is good, because you may not have to repay everything.
...
https://moneymaven.io/mishtalk/econo...0CgSTvznJQieg/
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Old 10-01-2019, 09:04 AM   #27
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Negative interest rates have quite literally broken one of the pillars of modern finance.

As economists and central bankers weigh the pros and cons of sub-zero rates and their impact on the world, traders have been contending with a rather more mundane, but fundamental issue: How to price risk on trillions of dollars of financial instruments like interest-rate swaps when their complex mathematical models simply don’t work with negative numbers.
...
More: https://www.bloomberg.com/news/artic...modern-finance
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Old 10-01-2019, 11:41 AM   #28
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I ponder the concept of borrowing a large amount of fiat at close to zero or zero and buying gold with the money, with the gold acting as security on the loan.

If it goes wrong, well the business goes bust, sorry.
If it goes well, the gov get their capital gain and i get the rest (-:

Got to be a better plan than bonds or deposits at a negative rate .........
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Old 10-03-2019, 07:51 AM   #29
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This was a fun read:
Originally Posted by Tuomas Malinen, Chief Economist of GnS Economics and an Adjunct Professor of Economics at the University of Helsinki :
...
So, what negative rates do is seriously impair the profitability of the banking sector, foster the creation of “undead” companies, kill productivity growth and deform financial relationships. They may be the single most destructive form of monetary policy ever invented.
...
https://www.zerohedge.com/markets/we...s-actually-are
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Old 10-03-2019, 09:23 AM   #30
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I read this and didnt feel very convinced by his arguments

Bank profit works on the difference between borrowing costs and lending charges and will generally be the same margin regardless of the base rate.

Have people stopped depositing their savings ? If so what are they doing with this spare money ?
If banks need funds to create loans ( and I thought they could create a loan through shadow banking at the stroke of a key) then surely the CB can offer them funds ?

The suggestion that people instinctively borrow less when we get to zirp or nirp also doesn't make sense to me.
I reckon they arent borrowing because well 'if it seems too good to be true .....' and at some point there will be an uptake of borrowing as a 10 year loan fixed at bugger all kinda makes sense if you need somewhere to live but are we holding back from business loans because we are 'waiting for the other shoe to drop' ?
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Old 10-10-2019, 07:35 AM   #31
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Well, Italian banking sector appears to agree with it...

Quote :
Unicredit, Italy’s biggest lender, is working on measures to transfer the European Central Bank’s negative rates onto clients holding more than 100,000 euros ($110,000) in their accounts, Chief Executive Jean-Pierre Mustier said on Wednesday.

The ECB last month cut rates deeper into negative territory as part of monetary stimulus aimed at reviving an ailing euro zone economy, nearly a decade after the bloc’s debt crisis.

In particular, the ECB’s deposit rate was reduced by a further 10 basis points to -0.50%.

Mustier, who chairs the European Banking Federation, said in an interview with French TV channel BFM Business that “negative rates have a significant impact on European banks’ revenues”.

To counter this, banks “can transfer negative rates case by case onto big companies or some big clients”, Mustier said, describing such clients as those with deposits of more than 100,000 euros. He did not elaborate.
...
https://www.reuters.com/article/unic...-idUSL5N26U440
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