The Great Roundup

There is little demand and the market is insisting on a higher yield. Wonder what the rates would be if we had a free market? The government won’t let that happen.

The US is the biggest debtor in the world. Politicos say they want to keep interest rates down to spur the economy. Yeah right!

If interest rates were 6%, instead of today’s 1%, investors would receive around $1.7 trillion in additional interest annually. Every IRA, 401k and pension plan would be healthier, and retirees would be sleeping better. Adding another $1.7 trillion to the annual deficit would make it tougher for politicos to buy votes (and sweet deals for their family) with tax dollars.

 

Negative Rates ahead?

When you consider inflation, interest rates are already negative. CDs and treasury bonds are guaranteed to destroy your wealth.

In 2016, then Fed Chair Janet Yellen told the House of Representatives:

“Negative interest rates are a tool employed by countries in Europe and elsewhere….

By some accounts, these policies appear to have provided additional policy accommodation. As I have noted previously, we certainly are trying to learn as much as we can from the experience of other countries. That said, while I would not completely rule out the use of negative interest rates in some future very adverse scenario, policymakers would need to consider a wide range of issues before employing this tool in the United States, including the potential for unintended consequences.”

Unintended consequences?

What are they? Bad consequences for the people or the banks and government?

Bankrate explains: Quoting David Lebovitz, executive director and global market strategist at J.P. Morgan Asset Management:

“Negative interest rates operate in an upside-down world of banking. Instead of a bank paying you to park your cash in a savings account or certificate of deposit (CDs), you’ll (theoretically) have to pay them to hold onto your cash. Think of it like a storage fee….”

Might this be the unintended consequences Yellen & Co. want to avoid?

“Experts say negative interest rates don’t always lead to the outcomes economic theory would suggest, stirring up concerns of bank runs and profitability….”

 

Eliminating bank runs and protecting THEIR profits

Business Insider tells us, “The Fed is looking carefully at issuing a digital dollar, Chairman Jerome Powell tells Congress.”

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For more detailed information on how to get the job done, you can download my FREE report: 10 Easy Steps To The Ultimate Worry-Free Retirement Plan – by clicking  more

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