The Impending Global Negative Interest Rate Regime Bodes Well for Bitcoin

[traderman]

The widely-publicized Bitfinex heist, which is the second biggest Bitcoin exchange hack after MtGox in 2013, may have a short term negative impact on the way general public perceives the novel technology. However, the Bitcoin blockchain - the backbone of the digital currency - was never compromised and the network continues to function without a hitch. The same could not be said for the world’s financial system!

Full article: http://razorsforex.blogspot.com/2016/08/the-impending-global-negative-interest.html

[1715569173]

1715569173

[1715569173]

1715569173

[QuestionAuthority]

Sometimes I think forex trading is the only thing keeping Bitcoin alive.

[davis196]

The widely-publicized Bitfinex heist, which is the second biggest Bitcoin exchange hack after MtGox in 2013, may have a short term negative impact on the way general public perceives the novel technology. However, the Bitcoin blockchain - the backbone of the digital currency - was never compromised and the network continues to function without a hitch. The same could not be said for the world’s financial system!

Full article: http://razorsforex.blogspot.com/2016/08/the-impending-global-negative-interest.html

Negative interest rates can slowly destroy the world`s financial system and economy.

I don`t know why central bankers don`t get it.

Bitcoin is strong and vulnerable at the same time.

[countryfree]

Negative interest rates are only a consequence. The real trouble is in unlimited money supply and quantitative easing. If the central banks and the whole financial system weren't creating money out of thin air, interest rates would be positive again in no time.

[bryant.coleman]

Sometimes I think forex trading is the only thing keeping Bitcoin alive.

Yeah..... especially in China and Russia, some individuals are converting a small part of their wealth to BTC, in order to guard themselves against the devaluation of the local currencies. And if I am not wrong, almost every single global currency (with the exception of the USD) is getting devalued right now. For example, one Euro was worth $1.40 two years ago. Now it is worth $1.13.

[franky1]

negative interest rates do not result in people spending more. it just results in them moving their funds to a different method of storage that wont charge them.

there is no rational reason why BoS would do this as it ultimately would lose them business.
EG a deposit of £1m equates to a allocation of £10m that BoS can fractional reserve themselves.
so while they hope to collect £40k if the depositor stays with them. but the reality is that the depositor will take out the £1m and go elsewhere and then BoS cannot loan out £10m which even at a standard mortgage rate of 5% would have yielded them £500k in interest

i feel something else is going on behind the scenes because if i can work out that charging someone £40k has a risk of losing £500k.. then they should too
i feel something else is going on behind the scenes because BoS has said they want to stay in the EU. so making Euro holding depositors leave them is the opposite to wanting to stay involved in the EU.

either way its not going to be good for BoS and depositors will just move their funds out...
.. which the op is presuming 'may' be into bitcoin.

personally i dont think there will be a big bitcoin buy-up due to BoS, but the news itself of stupid idea's banks come up with that have no rational reason, or proves that banks are bad.. can only be a good thing for real asset holders like bitcoin

[Jalinco]

Sometimes I think forex trading is the only thing keeping Bitcoin alive.

Yeah..... especially in China and Russia, some individuals are converting a small part of their wealth to BTC, in order to guard themselves against the devaluation of the local currencies. And if I am not wrong, almost every single global currency (with the exception of the USD) is getting devalued right now. For example, one Euro was worth $1.40 two years ago. Now it is worth $1.13.

It's the same with the GBP it was roughly 1GBP - 1.60USD just months ago but now since the brexit decision it is more like 1GBP - 1.30USD.

[Carlton Banks]

If the central banks and the whole financial system weren't creating money out of thin air, interest rates would be positive again in no time.

And that carries a serious risk of implosion of the sovereign bond market. Most of those debts are unpayable, and the only course of action for central banks is to.... do exactly what they're doing right now, buy their own bonds themselves. With more printed money..... see where this is going?

[franky1]

It's the same with the GBP it was roughly 1GBP - 1.60USD just months ago but now since the brexit decision it is more like 1GBP - 1.30USD.

to me its a good thing.

say i was selling a product for £100 and an american wanted 10 items (i want £1000)
americans had to pay $1600 months ago.
now they can buy it for $1300. ($300 left in their pocket, and i still get £1000)

think of it this way
take that same $1600 initial amount, it would get the american 12 items(2 items free compared to previous order of same cost) and i would get £1200

so its a win win for both sides.

[BitcoinSupremo]

Euro is strange that is the course with EURUSD to 1.13 considering the negative rates of the European Central Bank the Euro in pair with USD should continue to devaluate which isn't doing it right now. However this happens because of soft data from the economic numbers of the US last week. Once US economy starts showing strong economic data the pair EURUSD should continue its downtrend and without wanting I have told you how this pair will go in the long run so people of the FOREX can make some profit

[mindrust]

Euro is strange that is the course with EURUSD to 1.13 considering the negative rates of the European Central Bank the Euro in pair with USD should continue to devaluate which isn't doing it right now. However this happens because of soft data from the economic numbers of the US last week. Once US economy starts showing strong economic data the pair EURUSD should continue its downtrend and without wanting I have told you how this pair will go in the long run so people of the FOREX can make some profit

They can't stay weak forever can they? According to longforecast.com, EUR/USD will rise to 1.17 max till 2018, then it will go below 1.00 in 2018. Those numbers support your  message. They will shake out the weak hands first, then they will continue where they left. EUR/USD was 1.50 at first, it became 1.30 and now 1.10. Tested 1.05 a few months ago. When USA recovers, it will certainly go below 1.

[Carlton Banks]

Euro is strange that is the course with EURUSD to 1.13 considering the negative rates of the European Central Bank the Euro in pair with USD should continue to devaluate which isn't doing it right now. However this happens because of soft data from the economic numbers of the US last week. Once US economy starts showing strong economic data the pair EURUSD should continue its downtrend and without wanting I have told you how this pair will go in the long run so people of the FOREX can make some profit

They can't stay weak forever can they? According to longforecast.com, EUR/USD will rise to 1.17 max till 2018, then it will go below 1.00 in 2018. Those numbers support your  message. They will shake out the weak hands first, then they will continue where they left. EUR/USD was 1.50 at first, it became 1.30 and now 1.10. Tested 1.05 a few months ago. When USA recovers, it will certainly go below 1.

Not convinced. The dollar has been inflated more than any other (major) currency since 2008, and the US economic recovery has been weak (and that's assuming the weak numbers are reliable). Rates have to stay zero or negative, otherwise more money creation will be needed to buy the US sovereign debt that no-one is interested in. Any medium term EUR/USD dip is not reflecting that overriding reality: the dollar is literally so worthless that the Fed is giving it away for free.

[traderman]

Maybe that was the whole point right from the get go. Crater the financial system and set the stage for something else.

The widely-publicized Bitfinex heist, which is the second biggest Bitcoin exchange hack after MtGox in 2013, may have a short term negative impact on the way general public perceives the novel technology. However, the Bitcoin blockchain - the backbone of the digital currency - was never compromised and the network continues to function without a hitch. The same could not be said for the world’s financial system!

Full article: http://razorsforex.blogspot.com/2016/08/the-impending-global-negative-interest.html

Negative interest rates can slowly destroy the world`s financial system and economy.

I don`t know why central bankers don`t get it.

Bitcoin is strong and vulnerable at the same time.

The widely-publicized Bitfinex heist, which is the second biggest Bitcoin exchange hack after MtGox in 2013, may have a short term negative impact on the way general public perceives the novel technology. However, the Bitcoin blockchain - the backbone of the digital currency - was never compromised and the network continues to function without a hitch. The same could not be said for the world’s financial system!

Full article: http://razorsforex.blogspot.com/2016/08/the-impending-global-negative-interest.html

Negative interest rates can slowly destroy the world`s financial system and economy.

I don`t know why central bankers don`t get it.

Bitcoin is strong and vulnerable at the same time.

[belmonty]

...

personally i dont think there will be a big bitcoin buy-up due to BoS, but the news itself of stupid idea's banks come up with that have no rational reason, or proves that banks are bad.. can only be a good thing for real asset holders like bitcoin

If enough people buy a small quantity of Bitcoins to hedge against all the crap going down with fiat then it could result in a big bitcoin buy-up. I'm sure some Bitcoin holders who found their Bitcoins going up in value as their fiat crashed against the dollar told their friends and family about the profit they made. The people they told might decide to buy a small quantity of Bitcoins themselves as a hedge. If they make profit some will tell others about it, and perpetuate the cycle.

[MingLee]

Sometimes I think forex trading is the only thing keeping Bitcoin alive.

Forex trading definitely helps to keep Bitcoin alive, and I personally don't mind it because it has a decently good impact on the price and helps to keep people interested while nothing really happens.

As for the exchange hacks having a short-term impact on the value of Bitcoin, that's true a large majority of the time. The value is slowly going back up, and I don't think the hack will have much of an impact in the future.

[vero]

not so easy to turn people away from the bank just because interest rates are negative and they will continue to receive any policy given by the bank, in fact what they are seeking is not the interest rate but a safe place to save money.

[bitbunnny]

Regardles to interest rates banking is still inevitable. At the moment people can't relay on the Bitcoin only and this struggle between fiat and Bitcoin will continue.

[yayayo]

Negative interest rates are just one example of the negative consequences that politically controlled monetary systems have for the population. So it can certainly be a driving factor for an increased search for alternative stores of value. However, Bitcoin will not be the only profiteer from this development. The holdings of physical fiat cash and precious metals will also increase.

Overall, negative interest rates currently affect primarily wealthy individuals. I think that inflation in terms of price increases will be felt to a greater degree by the average population and might ultimately be the strongest driving force for Bitcoin adoption. The central banks around the worlds have already set the stage for rampant inflation by excessively increasing the fiat money supply in their foolish and futile attempts to "save" the economy.

ya.ya.yo!

[countryfree]

If the central banks and the whole financial system weren't creating money out of thin air, interest rates would be positive again in no time.

And that carries a serious risk of implosion of the sovereign bond market. Most of those debts are unpayable, and the only course of action for central banks is to.... do exactly what they're doing right now, buy their own bonds themselves. With more printed money..... see where this is going?

Very well. I still believe it's still possible to reverse the actual trend, though. But that would require a race of politicians which doesn't exist any longer.

[Carlton Banks]

If the central banks and the whole financial system weren't creating money out of thin air, interest rates would be positive again in no time.

And that carries a serious risk of implosion of the sovereign bond market. Most of those debts are unpayable, and the only course of action for central banks is to.... do exactly what they're doing right now, buy their own bonds themselves. With more printed money..... see where this is going?

Very well. I still believe it's still possible to reverse the actual trend, though. But that would require a race of politicians which doesn't exist any longer.

The mathematical possibilities prevent it, the national debts of the developed world are simply far, far too big. Some of that debt is a 1 million % joke. 1 million %, I am barely exagerrating.

When the mortgage market crashed the world financial system in 2008, instead of writing off the mortgages that were never going to get paid, do you know what happened? The unpayable mortgages were bought from the banks who owned the debt, by the central banks. In the 8-9 years since, guess what proportion of those mortgages have been paid back? (I hope you're thinking, "but it's impossible for even 1 measly Dollar to be paid back, the borrowers reneged the debt, that was the whole reason for the crash!").

It's a seriously bad joke, as I said, but the alternative was to write the debt off, accepting that it was worthless as it wasn't going to be paid back. There was too much of it, all borrowed to buy in a hugely overbought market, and too many secondary bets (aka derivatives contracts) based on those mortgages. It would've bankrupted nearly every major bank, and that's on the basis of figures that you have to take for granted to some extent (why not lie about a handful of institution's solvency, you're printing up an amount of money that replaces every Dollar, Euro and Pound in the system anyway).



This is where the expression "zombie banks" come from, they're all on death row. They borrowed and bet more money than there is real stuff, by a factor of dozens, if not hundreds, of times the value of the entire world economy. Do you still believe it's possible to reverse the trend?