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Volume 2: Turbulent Years Chapter 793: The consequences of negative interest rates!

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    We know what happened in Europe, but why?  Could it be because of the five European pig countries?  You know, in the past, Europe seemed to be pretty good, at least much better than Japan. They also did well with China. We were all developing the economy together, so why did something happen?  So sudden.  n¡Ê Yes, it is indeed sudden, but if we really speak of it, the trouble in Europe was actually the root of the disaster early on!  Is it because of the five European pig countries?  These five are just pig teammates. What really makes them go to the abyss is actually something else.  We have all heard the term negative interest rates.  More than 20 years ago, that is, around 2010, this term appeared more and more in the minds of us Chinese people. It mainly meant that our CPI was growing rapidly, but it seemed that inflation was relatively high.  , but our bank interest rates are very low, which creates a difference, which we call negative interest rates.  However, this is not what the negative interest rates in Europe mean.  The negative interest rates in Europe were in 2015. When Europeans went to the bank for a loan, if the loan was approved by the bank, what would the loan look like?  The interest charged by the bank means that they lent you money, but you need to pay back the interest. But now the bank is telling you that not only do they not charge interest, but they will also give the money to you!  -0.02, it seems like this is the interest rate at first. In fact, it doesn¡¯t look high. The amount the bank will give you won¡¯t be much, but.  This is fucking giving you money again!  To put it simply, at that time, European banks lent out 100 yuan.  The most they can get back is 90 yuan, yes.  That's what it looks like.  Isn¡¯t this too fucking ridiculous?  Are all these banks stupid?  Or crazy?  The banks were neither stupid nor crazy, because the economic policy of Europe at that time was like this. If banks did not lend money to others and implemented negative interest rates, then European governments would punish the banks. In fact, this was also set by the European Central Bank.  A policy, that is, the decision-making above is like this.  But why is this?  What are the consequences of this?     as a result of.  We have already seen that there is a big problem in the European economy, but the reason is actually very simple.  The European Central Bank is printing money desperately!  Yes, that¡¯s the reason, printing money.  Just imagine, I printed a lot of money, but what I printed was money. If this money was lying in the bank, it would be wrong.  That doesn't create any value, right?  Then it's very simple. You must borrow money. Only by using this money can you generate value.     so.  The bank's interest rate is negative, and their purpose is to lend out the money. This is a very, very simple reason.  And it sounds true to us, it¡¯s very simple.  Very reasonable, but!  Should we think about it?  Why print money?  Nearly twenty years have passed. When our current economists look at that period of history, everyone will find it funny, because it is indeed funny.  Why is it funny?  First of all, what is the purpose of printing money?  Let¡¯s first look at who started printing money first, was it Europe?  No, this is what the United States did at the beginning. During the economic crisis in 2008, well, it is still defined as a financial crisis. In order to deal with this crisis, it can be said that the Federal Reserve had no other options at the time.  So, they thought of the last solution, printing money!  To be more elegant, it was called quantitative easing, or qe.  The initial plan, qe1, was US$600 billion, but later, the economy continued to be bad, and it just couldn¡¯t work, so we continued to print, and printed up to US$4 trillion, which seems The economy is actually still not good, although in the third quarter of 2014  In the quarter, the United States said that it was great. You see, my GDP grew by 5% this quarter, but the growth for the whole year of 2014 was only 2%. This is no different from the previous two years and does not mean anything. In other words, the economy is still very weak.  rotten.  But we can¡¯t continue to print it. If we continue to print it, the dollar will lose its value. To put it more deeply, it means that the hegemony will be lost!  So, in fact, when the U.S. dollar stagnates and self-replicates, it is passive and there is nothing that can be done. However, even so, once the printing of U.S. dollars stops, the whole world will have a problem, that is, the U.S. dollar must return to the United States.  ??To most people, this problem seems to be nothing. If it¡¯s not just about going back, then just go back.  However, there is a liquidity problem here, that is, the U.S. dollar is the world currency, and oil still needs U.S. dollars to be settled. Therefore, when the U.S. dollars return to the United States, the whole world is connected.The problem of insufficient liquidity of the U.S. dollar means that there is no U.S. dollar. What can we do?  Is there anything difficult about this matter?  Because of what happened before, this matter is difficult to handle. What happened before? ????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? U.S. dollars are being printed, and are proliferating all over the world, but this inundation is not given casually, this inundation will not find someone and give him a pocket of dollars, this inundation is a loan!  Yes, who can get a loan?  Large enterprises, big capitalists, big companies, right?  It must not be ordinary people, because how can they qualify for a loan?  This loan is very powerful and has a large amount because it is cheap!  The Federal Reserve almost pushed bank interest rates to 1% or below because it had no more money. This is why it printed money, so the interest rate on loans was also very low, 1%.  1% loan is still in U.S. dollars, so capitalists, business owners, and large companies in other countries are not interested?  Borrow, borrow, borrow!  Buy buy buy!  Since 2008, commodity and real estate prices have grown very fast. Let¡¯s talk about China. When did our real estate take off?  That¡¯s right!  It was this time period, but the Olympics was covering it up so we couldn't see it very clearly, but in fact, how did those earth kings come into being?  Isn¡¯t it just that big companies can get cheap US dollar loans?  The situation at that time.  There are earth kings almost every day, and new records are reached every month.  Right?  Let¡¯s look at the 4 trillion at that time. How much was this 4 trillion?  It¡¯s a deal.  That¡¯s $600 billion!  ¡°When you put this together, you can understand why we need to invest 4 trillion yuan, just to cope with the impact of this US dollar on us.  These loans were issued, and they were successful, but if domestic companies wanted to invest in domestic industries, they had to be converted into RMB. In other words, the government at that time could not stop large companies from taking loans.  That one is so tempting, no one can stop it, and there's nothing you can do to stop it, so what?  Do you still want to block foreign investment?  Still can¡¯t carry out reform and opening up?  ??????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????This will inevitably causeRMB? to appreciate. It is easy to understand if money is regarded as acommodity, things are rare and expensive.  So once the RMB appreciates, what will be the consequences?  Exports are finished and there is no competitiveness anymore.  Then there will be large-scale layoffs, and what happens next will be instability, and there will be demonstrations and marches.  Is it still far?  So, print money first and let this money go.  Maintain a stable exchange rate.  So, we see.  At that time, the Americans kept accusing us of manipulating the exchange rate.  "This is really a thief's cry to catch the thief, you print money first.  This problem arises, but the result is that we are wrong?  This is such a mess!  ??This matter, not only did we in China do this, but basically all emerging market countries at the time did this, because no one could bear the problems that followed, so they chose to allow the asset bubble first.  Of course it¡¯s a bubble, because all the money coming in is hot money.  So, what is the purpose of actively printing money?  It¡¯s because the economy is in bad shape that they are printing money. It¡¯s very simple. Europe is printing money because the economy is in bad shape. It¡¯s that simple! ?? Emerging market countries print money passively, and those who actively turn on the money printing press are definitely because their own economies are in trouble, otherwise they would not do this. This is true for the United States, and the same is true for Europe.  If the economy is in decline, is it really effective to print money like this?  This is what¡¯s really funny, because printing money actually has no effect on the economy. All it can do is make your books look good, but it doesn¡¯t actually increase the economy.  What is economy?  ¡°At least there must be commodities, they must be circulated, and then they must be circulated and consumed. Only then can a circle be formed. But what is money?  Money is a certificate, money is a note for buying and selling goods, nothing more.  Currency is not a general equivalent!  In other words, there is more money, but there is no increase in goods, and there is no real increase in consumption power. So, how can the economy get better?  And that¡¯s not all. Why does the European Central Bank force banks to lend?  The purpose is to let their increased currency circulate into the market. They can't just lie there, but can they achieve their final goal by forcing loans like this?  In other words, revitalizing the economy?  Now there is more money, but the goods have not increased, and the demand has not changed. There is just more money, and if you hold the currency and do not lend, the higher authorities will punish you. So what will happen?? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? all all all all all remember all the times during the economic crisis of the 20th century, when farmers threw away milk?  Yes, this is the result. Not only will the economy not improve, but capital will also suffer losses!  So, after a few years of doing this, Europe couldn't sustain it. In fact, Japan had the same problem before, because Japan was actually printing money on a large scale. Japan had already had 0 interest rates. For many years  0 interest rates, and then printing money, which is equivalent to negative interest rates. Therefore, the pattern of everyone's failure is actually the same.  But this matter, printing money, seems to have started in the United States, so are they okay?  "Wow!" John and Maggie followed their mother to the mall for shopping. They passed the TV area, and it turned out that it was all red, the tiles were red!  The story of the United States, red represents a decline, yes, not long after Europe was over, the U.S. stock market experienced a huge decline!  (To be continued, please search Piaotian Literature. The novels will be better and updated faster!
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