Sunday, October 25, 2020

Tag: IMF Recommends “DEEP” Negative Interest Rates as the Next Tool

IMF Recommends “DEEP” Negative Interest Rates as the Next Tool

by Martin Armstrong, Armstrong Economics:

The IMF has continued to assume that the zero-bound on interest rates can be a serious obstacle for fighting recessions on the part of the central banks. The IMF maintains that the zero-bound is not a law of nature; it is a policy choice. The latest in the IMF papers argue that tools are available to allow central banks to create deep negative rates whenever needed to reverse recessions. They claim that maintaining the power of monetary policy in the future to end recessions within a short time will require deep negative interest rates.