Quote:
Originally Posted by RummyBoy
Well if interest rates are lower than the inflation rate, that's a negative real interest rate so sure you lose purchasing power on your money and its like an invisible tax. However, it's different to actually losing the real amount held in your bank which you can see depleting every year in your account (in addition to inflation).
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It's actually no different, the difference is only in your mind... so really, if negative interest rates were to be implemented, nothing would change except those that now fail to see that real interest rates are now negative, might get nudged to productively invest their funds...
