Impeachment

[Kirkland Laing]

Too much posting for me to keep up, but I will say it forever until the day I die, interest rates are way too low. Mind you I got a bank to give me 5%, but they only let me put in 300 bucks a month for a year. That is not going to pay for my facelift at 50, is it?

I think the Corona beer virus that induces deadly hangovers is probably going to sink things this year. Interesting that a recession is about to happen at this election cycle juncture, but hopefully people stop drinking soon.

How are interest rates too low? Either from a monetary policy position or an actual real world position? Central banks like interest rates low enough to generate low stable inflation. Two percent is the normal target rate. Central banks haven't been able to generate two percent inflation since the 2008 meltdown even with zero interest rates and QE. In the real world there's a gigantic ocean of money looking for returns. There are so few things to invest in and so much fucking cash out there that the people with the dough will fucking pay governments to look after it for the next ten/twenty/thirty years.

In what universe should interest rates be higher? The global economic recovery is so poor that increasing rates right now would cause a recession, which would cause money to pour out of speculative assets like stocks into safe assets like government bonds which would ......... cause interest rates to fall. In the next recession yields on American government bonds will go negative. Investors will be paying the American government to borrow their money.

There is a way for economies to raise interest rates. A massive redistribution of welth from the wealthy to the not so wealthy to make up for the forty year ongoing massive upward redistribution of wealth that we're currently experiencing. Hand that money out to people and they'll spend it in the real economy, creating demand for goods and services, creating an economic boom with loads of investment opportunities which creates a demand for money from firms to invest in catering to this economic boom by building new factories, plant and equipment, staff and so on. Lots of demand for money from a capital pool diminished by the redistribution does what to interest rates?

This economy is an abortion. Interest rates should have been raised after a bank clearing out period in 2008 meaning to take the pain for a long term sustainable future. They took the easy options. Interest rates are too low. They should never be below 3% except in an emergency which suggests the recovery is a mirage. Plus these low rates are terrible for insurers and others like that. It is a bailout of the irresponsible and if you have a mortgage you cannot afford then I have little sympathy. Debt is a mugs game.

They tried raising interest rates to a whopping two and a half percent last year and the economy almost tipped into recession. That's because the economic recovery in out shitty deformed unequal economy is so shitty. It can't handle even two percent interest rates without growth stalling. 2008 wasn't an emergency? If they hadn't kept rates at zero back then we know for certain the recession would have turned into a depression. Rates rose automatically back in 1929 due to the dollar being tied to the price of gold and it turned the recession back then into a depression.

It is a problem that interest rates are low but the problem is that the economy is so fucked, unequal, deformed that it can't function properly anymore. Low interest rates are a symptom of this, not a cause.