Economics and Investing:

Venezuela’s Collapse Brings ‘Savage Suffering’ – Submitted by P.S.

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Items from Mr. Econocobas:

Welcome To Obama’s Recovery: Carrier Moving 1400 Jobs To Mexico | Zero Hedge

Items from Professor Preponomics:

US News

How Negative Interest Rates Could Remake the Global Financial System (New York Times) Excerpt: “A decade ago, negative interest rates were a theoretical curiosity that economists would discuss almost as a parlor game. Two years ago, it began showing up as an unconventional step that a few small countries considered. Now, it is the stated policy of some of the most powerful global central banks….”

Negative Interest Rates Won’t Save Us, But Helicopter Money Might (Fortune) Really? While I don’t agree with the conclusion, this is an interesting article from the standpoint of perspective and does add to an understanding of what policymakers may be considering. Excerpt: “When the next recession hits, governments around the world will need to find the political will and the resources to engage in massive spending to drag their economies out of their demand-deficient comas.”

The Danger of Negative Interest Rates (CNBC) Should the U.S. pursue the policy of negative interest rates. It is my view that unintended consequences are likely and not well understood. Excerpt: “Standard textbook theories hold that negative interest rates are infeasible because depositors always have the outside option of holding onto cash, which is storable and therefore pays an effective interest rate of zero. Recent experience and some expanding research suggest that zero is in fact not a binding floor on interest rates.”

International News

Negative Interest Rates in Europe: A Glance at Their Causes and Implications (World Bank) Excerpt: “As an additional measure to stabilize inflation expectations, a number of major central banks in Europe—including the European Central Bank, the Danish National Bank, the Swedish Riksbank, and the Swiss National Bank—have pushed key short-term policy rates into negative territory.”

ECB Rate Cut Likely But No Appetite for Now for Radical Easing: Policymakers (Reuters) Feeling reassured? Excerpt: “Doing nothing in March is very unlikely,” the governor of one of the euro zone’s 19 central banks told Reuters. “Monetary conditions have tightened, long term inflation expectations are falling and credibility is at stake.”

Negative Interest Rates? Deflation Risks Mean They Could Be Here To Stay (The Guardian) Excerpt: “Easy monetary policy with a mix of negative interest rates and QE is not all that surprising. It is unusual, to be sure, and conventional economics text books rarely, if ever, note the issues surrounding negative interest rates. But if inflation is very low and the risk of crossing the line below zero builds, counter-cyclical monetary policy requires interest rates to be cut and cut and cut, even if that means moving them well below zero.”

Creditors Must Brace for a Tsunami of Losses in a World Awash with Debt (The Telegraph) Excerpt: “Countries have taken on far more debt than can ever be repaid. As the European banking sell-off is already signalling, creditors are in for a brutal awakening. Get ready for debt restructuring mayhem.”

Personal Economics and Household Finance

3 Easy Ways to Pay Off Your Mortgage Early (Dave Ramsey) Excerpt: “Since we’re all about getting out of debt as quickly as possible, here are a few suggestions to get your home loan paid off quickly.”

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