Negative Interest Rates Are a Calamitous Misadventure

• NIRP is bad for banks and the economy. It will NOT work. No banks will loan money at zero or negative interest rates. They will not make money at zero percent and will lose money at NIRP. The banks will contract their existing loan portfolio when interest rates become zero and negative. Calling back loans will apply a contractionary pressure on the economy. Customers who cannot find refinancing will have to sell their assets and this will apply a deflationary pressure as asset prices collapse.
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• Similarly, when banks do not loan out money due to zero or NIRP, the economy will contract. Economic growth is fueled by financing (ie. debt, loans). People (most of us) do not buy a house by paying 100% of the price. We pay a deposit 10-20% down and borrow the rest. In the same way, infrastructure developments: roads, trains, buildings, airports, water system …. are only build when there is financing.
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• Why would anyone deposit money in the bank when it has NIRP and a bail-in rule as law (as in America and Europe). The answer is: money will flee the banking system and look for a place, an asset class as store of value. Even if cash is banned, depositors will flee to hard asset that is a great store of value. Obviously, the premier store of value throughout 5000+ years of history is physical gold/silver.
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• When depositors flee from money/cash in the bank to hard assets it is inflationary. Things that are bought with cash like food, gold, silver, water, petrol … will experience sharp increases in price ie. hyperinflation. Things that are bought with debt financing ie. a building, house, car, boat … are unlikely to face hyperinflation since banks in a NIRP environment are unwilling to extend loans. There will be a dichotomy: hyperinflation and deflation., The poor who spend a major percentage of their money on food, transport (ie. cash bought items)… will suffer the most.
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• Followed to its logical conclusion, NIRP implies economic and financial system collapse. As deflationary pressure sets in, it becomes a vicious cycle for assets. But as people flee cash/money into hard assets, the currency will collapse.
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• So why are Illuminist central banksters moving towards NIRP? It is a deliberate execution of a Satanic plan to trigger global economic, financial and currency meltdown. This is so that they can introduce their Luciferian New World Order, One World Government led by the Anti-Christ, Global Supra-National Central Bank, One World Currency backed by gold –> ‘666’. The path towards the endgame goes through Albert Pike’s Satanic WW3.
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• What the article below suggests: helicopter money is economic heresy. It will end in monetary/currency collapse ie. hyperinflation.
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• Negative Interest Rates Are a Calamitous Misadventure
  by Ambrose Evans-Pritchard, http://www.telegraph.co.uk/  
  When the debt-laden world faces the next global downturn, it will need the full power of helicopter money, not interest rate gimmicks
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  The world’s central banks should take a deep breath and step back from the calamitous misadventure of negative interest rates. Whatever theoretical profit can be mined from this thin seam, it is entirely overwhelmed by the slow ruin of the banking system.
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  Huw Van Steenis, from Morgan Stanley, calls negative rates (NIRP) a“dangerous experiment” that undermines the mechanism of quantitative easing rather than reinforcing it, and ultimately induces banks to shrink their loan books – the exact opposite of what is intended.
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  The market verdict on the Bank of Japan and the European Central Bank speaks for itself. Bank equities have crashed by 32pc in Japan and by 26pc in the eurozone since early December.
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  “Financial markets increasingly view these experimental moves as desperate,” said Scott Mather, from the giant bond fund Pimco. The policy blunder is creating a false fear that central banks have run out ammunition. It is distracting attention from the real failings of the global policy regime: lack of willingness to launch a New Deal and inject money directly into the veins of the real economy through fiscal stimulus when needed, and arguably to do so with turbo-charged effect through central bank transfers rather than debt issuance.
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  read more.

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