The Madness of Central Banks:
One need not have a PhD in economics to recognize that negative interest rates are financial lunacy. Who in their right mind would actually pay someone to take out a loan?
But negative interest rates are far worse than that. By eradicating interest rates, the #ECB has eviscerated the #banking business model in Europe.
Banks generate profits through either lending at interest or investing for interest. Without interest rates, the traditional banking business model cannot generate any profits--witness the travails of German banking giants Deutsch Bank and Commerzbank.
Banks and bankers as a whole are quite "systemically important". Without banks, business #finance cannot happen--again, one needs no deep education economics or accounting to understand that.
Yet the ECB has, through intentional and deliberate acts of financial sabotage, put European banks on a path to extinction.
Stupidity or Malice? The world wonders.
https://www.zerohedge.com/political/mish-negative-interest-rates-are-socio-political-poison#news#economy
With a PMI of just 41.4, the bottom has fallen out of the German manufacturing sector.
Germany was already heading for recession when the #ECB went negative on interest rates. Instead of stimulating the #economy, negative rates signal a lack of confidence in the economy and thereby discourage investment and spending. They make a recession more rather than less severe.
The Eurozone is heading into very rough economic seas, and without the ECB able to throw out a lifeline.
https://www.zerohedge.com/economics/collapse-germany-real-and-accelerating#news#trade#finance
With a PMI of just 41.4, the bottom has fallen out of the German manufacturing sector.
Germany was already heading for recession when the #ECB went negative on interest rates. Instead of stimulating the #economy, negative rates signal a lack of confidence in the economy and thereby discourage investment and spending. They make a recession more rather than less severe.
The Eurozone is heading into very rough economic seas, and without the ECB able to throw out a lifeline.
https://www.zerohedge.com/economics/collapse-germany-real-and-accelerating#news#trade#finance
