Bitcoin Forum

Using gold as a hedge also works, but gold has lack of granularity, high friction in use, and more counterparty risk.  Bullish:  BTC.

http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2016/02/09/MS%20negative%20rates.jpg

I agree. Hard currencies like bitcoin will gain much more popularity when people start losing money just by leaving it in their bank account.

"Well below 1%" sounds like something insane such as 5%.  Imagine only having 100k in the bank and losing 5k per year, wtf?  Even if it was "only" 3%, people would simply stop storing any kind of value in banks and convert all their wealth to stocks, real estate, gold, and Bitcoin.  The problem there is, you can't legislate the stock and real estate bubble into lasting forever with NIRP.  Eventually it will blow up anyway.  Things have to swing back towards the hard currencies instead (Bitcoin and gold).

That just tells me everything is turning into a shit show.

If loans are that low for 1%, basically people with the right networks who know certain people can buy up a company using that 1% payback..

This cheap money sounds like 2008 all over again.

This is even more ridiculous when you consider the high inflation rates that countries like India have. Here, the central government manages to achieve reducing your purchasing power, even while maintaining rates at 5+%. They just let inflation do its job. Real interest rates are way negative.

The issue is money velocity. It has been hurtling to lower and lower extremes while base money has been printed into the stratosphere in an attempt to prevent a deflationary credit collapse.

If interest rates ever become strongly negative then consider the bank pays you to continue your mortgage or loan if you are fixed to the central bank rates. Consider this will also drive money into bonds IMO which will pay nothing but continue to be a 'safe haven'. Bitcoin and other cryptocurrencies with exponentially falling inflationary schedules should benefit hugely also.

Over the longer term this is looking like it will become the greatest slow motion financial train wreck in history. Everyone still dies at the end. (The baby boomer generation has a lot to answer for.)

I theorized that NIRP signals the game has already ended and I thought it meant a black swan event was relatively imminent, but it's a complete mystery to me of if or how long they could extend the game of musical chairs.