BANK RUNS : Cash Out Now - Negative Interest Rates are becoming The New Normal !!

According to investopia : Interest rates are typically assumed to be the price paid to borrow money. For example, an annualized 2% interest rate on a $100 loan means that the borrower must repay the initial loan amount plus an additional $2 after one full year. On the other hand, a -2% interest rate means the bank pays the borrower $2 after a year of using the $100 loan, which is counterintuitive. While negative interest rates are a strong incentive to borrow, it is difficult to understand why a lender would be willing to provide funds considering the lender is the one taking the risk of a loan default. While seemingly inconceivable, there may be times when central banks run out of policy options to stimulate the economy and turn to the desperate measure of negative interest rates. Negative interest rates are an unconventional monetary policy tool. They were first deployed by Sweden's central bank in July 2009 when the bank cut its overnight deposit rate to -0.25%. The European Central Bank (ECB) followed in June 2014 when it lowered its deposit rate to -0.1%. Other European countries and Japan have since chosen negative interest rates resulting in $9.5 trillion worth of government debt carrying negative yields in 2017, according to Fitch. Negative interest rates are a drastic measure that shows that policymakers are afraid that Europe is at risk of falling into a deflationary spiral. In harsh economic times, people and businesses tend to hold on to their cash while they wait for the economy to improve. But this behavior can weaken the economy further, as a lack of spending causes further job losses, lowers profits, and reinforces people’s fears, giving them even more incentive to hoard. While negative interest rates may seem paradoxical, this apparent intuition has not prevented a number of European central banks from adopting them. This is evidence of the dire situation that policymakers believe is characteristic of the European economy. When the Eurozone inflation rate dropped into deflationary territory at -0.6% in February 2015, European policymakers promised to do whatever it took to avoid a deflationary spiral. However, even as Europe entered unchartered monetary territory, a number of analysts warned that negative interest rate policies could have severe unintended consequences, End of Quote . Last month the Swiss National Bank said it would hold the negative rate it charges on commercial banks’ deposits at -0.75%, while the ECB deposit rate is -0.4%, but is widely expected to drop by another 10 to 20 Basis points, which in turn will prompt even more negative rates in Switzerland. In a note to clients last month, UBS forecast that the SNB would lower its rate on deposits to -1% in September, approaching dangerously close to the infamous "reversal rate", below which accomodative monetary policy reverse and once again becomes contractionary for lending, the true lower bound of Negative Interest Rate Policy . UBS announced recently that it will Start Charging Rich Clients With Negative 0.75% Interest Rate . The UBS announcement comes on the same day as Credit Suisse, UBS’s main rival, said it was also thinking about imposing a negative deposit rate on their wealthy clients . The Banks now are practically charging you money for you to loan them your money . Funny how financial engineering always turns everything upside down but the purveyors of this mess continue to think they are doing a good job. Everybody, and I really mean Everybody, should get their money out of the banks and stuff it in safes and mattresses, Investing a little in Gold and Silver is another option. Investing in Stocks ,bonds ,or real estate is in the moment not the best idea due to the stretched valuations. Right now equities across the world are inflated, as is housing in nearly all markets. If anyone thinks this debt is going to be paid, they are dreaming. People should rather hold gold which yields zero, than fiat in the bank with a negative yield. The whole bloody mess is melting down. Paper money will prove to be worthless when the elite thinks all are in. And this can only lead to a run on the banks. Negative interest rates are becoming the new normal , and this is Coming to a US bank near you. Time to cash out.












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