And Europe, Scandinavia, and Japan have done this.

yeah you're holding out for a miracle at this point

These people are fucking idiots.

i didn't think Japan was as bad off as EU and Scandinavia

Okay, bearly.

Can you tell me why the nominal interest rate is theoretically bound by zero?

You are a sick fuck.

I thought I knew the depths of humanities stupidity.

And you just revealed to me a whole new dungeon.

You jerk.

<:lolz:480186121897377792>

Me? Bitch I am trying to grasp a quite compley financial concept

This is literally me asking for you to provide me knowledge.

My instinct was on point, though. They are literally paying people to spend their money.

The idea is, if you make holding funds painful, people will buy shit.

Banks will eagerly loan to people.

People will try to start businesses with their newfound "wealth"

And, central to modern economics, is that money has to move in order to keep going.

You could think of the modern economy as a shark: if it stops moving, it drowns.

Like dude I have gotten the whole "we pump that money into the econ" shit that been going on

(The analogy is not very far off in terms of predation)

But, sometimes, (more often than not, I suspect), it's not money that's the problem. It's the law and market that represent a barrier that cannot be easily surmounted.

Well, unless you're willing to go the Uwe Boll route and make disasters and take advantage of tax and lending loopholes.

But what I really didnt know until know or maybe I just dont recognize it is that you say that nominal interest rates bounded by zero. Who determines this? Like a central bank (in which case it is arbitrary to go below 0) or somebody else?

But then you're moving into low-integrity type stuff and that degrades society and quickly.

No, the assumption is that the stated interest rate will only go to 0% because no one will pay someone to spend money for them.

Or is it the whole "we cant officially state that we pay money in order to get people to lend money"

Ah NOW I can see where you are coming from.

an interest rate less then 0 is called a fire

and thats where you put your money

So, every economist figured every person ever would say, "Sure, i'll let you borrow my money. Nah, no interest. Just pay it back"

And no one would say, "Hey, have $20, and please, also spend this other $100."

Which is what a negative interest rate is saying.

So see, I agree that neg intrst rates are poison, that has always been the understanding from my side, even far ahead of this convo today

And so your prediction that the Fed would promote a negative interest rate is absurd.

*But...*

<:clownpepe:564530802667290625> <:tard:480186130105630730> <:clownpepe:564530802667290625> is real

But since neg intrst is happening in the European already, although not officially set lower than 0 but through other effects I can envision the fed going lower, possibly to the area where it the real intrst rate is neg

But let's say my prediction doesn't hold true (which I hope)

What hinders the US from lending money they wont pay back anyway?

The same thing that hinders *anyone* from *borrowing* money they won't pay back anyway: eventually, no one will lend them anything.