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Regardless, even if Sweden was moving to a cashless society, you haven't explained the relationship between negative interest rates and cashless policy. Switzerland and Japan both have negative rates, and neither one is "cashless."
Negative interest rates push the small banks out of business.
A cashless society puts all the power in the Central Bank and then no one can escape negative interest rates.
The banks in Japan have not pushed the negative interest rates on their customers. They are taking the loss themselves.
Switzerland upped interest rates on mortgages to compensate.
http://www.nytimes.com/2015/12/27/bu...ears.html?_r=0
Few places are tilting toward a cashless future as quickly as Sweden, which has become hooked on the convenience of paying by app and plastic.
..
It is also a practical matter, as many of the country’s banks no longer accept or dispense cash.
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Bills and coins now represent just 2 percent of Sweden’s economy, compared with 7.7 percent in the United States and 10 percent in the euro area.
You have shown absolutely no proof that negative interest rates benefit the billionaires. The owners of capital (ahem, the "billionaire class") would want positive interest rates, no? Please share with us the logic behind this instead of spouting off slogans and one-liners you probably got from 3:00 AM Youtube videos.
Give me a break. The results of Fed policies are crystal clear. The only beneficiaries have been the top 1% which is why there is a political and social insurrection in process on the U.S.
As for logic, Bankers just steal money and put it in their vaults. They've been doing it for eons and they're doing it all over the world right now. How's that for logic?
Next time you want logic just read about the nature of theives and theft.
The purpose of negative interest rates is to promote consumer spending
The purpose of negative interest rates is to promote borrowing.
Quote:
Originally Posted by Jobster
, so if they can eventually get rid of cash, it would prevent bank runs and in theory promote borrowing and spending because savers would be taxed when holding accounts at banks.
Nobody is getting rid of cash.
Quote:
Originally Posted by Jobster
In practice; however, this is not working. Are you a troll or are you really this naive?
The purpose of negative interest rates is to promote borrowing.
Nobody is getting rid of cash.
"In practice" no one is attempting this.
No, the negative interest rates don't apply to borrowing.
Take Switzerland...the interest rate is -0.75% but their mortgages (15 year) just got raised to 2.5%.
The banks are being charged negative interest rates and to make it up they raise the rates on their loans to consumers. They have not touched consumer savings yet.
You will not see loans to consumers with negative interest rates EVER.
The purpose of negative interest rates is to promote borrowing.
Nobody is getting rid of cash.
"In practice" no one is attempting this.
Uh, why do people borrow money? Man, use logic.
There are several countries that have negative interest rates; however, their economies have not responded as planned. In fact, an argument can be made that people will save more because they are worried about having nothing for retirement.
Nobody is getting rid of cash because le roi says so? Man, maybe you oughta stick to threads that you're an expert in, like that thread where you think it's alright to be naked in front of kids.
Charging people to keep their money in the bank is hard to do so long as cash is available, as people may just withdraw all of their money from those banks in the form of the national cash and squirrel the cash away. In order to penetrate the twilight zone of economics, central banks need to abolish cash to terminate this escape route. Then they can force savers to spend, thereby increasing the flow of money through the economy, by raising the cost of holding money in a bank account as high as it takes to get people to spend their money. No sense letting perfectly good money waste away in an expensive bank account.
Transitioning into a cashless society is the ultimate central planner’s dream as it gives central banks total control over money, and money is their proprietary product.
No, the negative interest rates don't apply to borrowing.
Yes they do.
Quote:
Take Switzerland...the interest rate is -0.75% but their mortgages (15 year) just got raised to 2.5%.
Right, and the banks borrow at -0.75%. Which is negative.
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