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by wemdyjreichert
2628 days ago
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https://www.investopedia.com/terms/n/negative-interest-rate-... It's an extreme expansionary policy designed to keep the economy afloat by making people pay money to keep it in banks. Normally this is done by dropping interest rates below inflation; this is the nuclear option for economies. The fact that they are still stuck on this is not a good sign for what may happen to Europe next recession. This is one of the inherent limitations of a shared currency: Greece needs expansion; Germany needs contraction. Help one; harm the other. It's very difficult to do the kind of things America (or most other nations) can do with Europe for this reason. |
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