Thursday, September 17, 2015

No Rate Normalization During My Lifetime

Subtitle: No Rate Normalisation During My Lifetime
(Ben Bernanke   2015)

This is a quick financial update for anybody who has not been following the chances of a US Gov. interest rate rise that has been strongly hinted for September 17 2015

No Interest Rate Rise

The press release is here:

As even the most dimwitted of us know

- Individuals and Companies across the globe have borrowed money, and government are scared that raising interest rates would lead to default on a wholesale scale

- But the artificially low interest rate policy also encourages people to borrow even more, because let's face it, it is so attractive.  Compulsive debtors and scammers who have no intention to repay just cannot believe their luck

- at a 1% rate then, that 1 million dollar house,  costs just  833 dollars per month to live in, on an interest only mortgage.

Negative Interest Rate Program

Unfortunately the following chart also circulated indicating that it's possible to consider rates actually going negative, before at some later stage (of course) returning to a positive level.

This is analogous to your friend pleading with you saying:

Look,  I will give up gambling soon,  I'm up to my eyeballs in debt now , but meantime,  perhaps just one more loan? Oh, and can I pay you back, well, you know, slightly less than I borrowed.  NIRP and all.

A reporter asked Janet Yellen about the above and the reply that it was considered, but wait, not seriously considered.

And so to the responses that I might just have heard ....

Overhead in the Locker Room

So they considered it, but not SERIOUSLY considered it.  When the shit hits the fan then they will SERIOUSLY consider NIRP.  I got it now.

"no rather normalisation during my lifetime".....or anyone else's for that matter.

"If it were positive to take interest rates into negative territory I would be voting for that," she told reporters after the speech

NIRP soon, bitches!  

How much gold can one stash  under the bed

Shall we skip QE4 and go straight to QE5?


The Fed is dead.  Long live the People's bank of China

We will keep rates on hold and wait for nirvana to allow interest rates to rise again

The Fed is dead baby


You just couldn't make this stuff up could you.

I'm so depressed, I turn to Chris for some comfort ...

Chris Rea; Fool if you think it's over