[acd]

Thanks insightful comment. Increasing inflation will help pay of the loan as it will get lower through inflation.

I personally think central banks have not understood that lower interest rates decreases inflation rate. Ie normally and historically central bank would try to increase inflation by lowering interest rate and thus how many have jobs. But jobs are now done automatically by software robots and that get cheaper by lower interest rate to invest in. But central banks thinks lower interest rate will increase inflation.

[nabla9]

The problem is not that lowering the interest rate has stopped increasing inflation, it's that central banks can't lower real rates enough. They are facing so called zero lower bound problem: https://www.investopedia.com/terms/z/zero-bound.asp This is called liquidity trap.

You can set the interest rate little bit below zero, but you can't go significantly below zeor or banks just start storing cash in vaults (it becomes economically viable to physically store vast amounts of cash). You can actually think these zero or negative rate mortgages as bank's way to store capital.

I don't think the root cause is financial or monetary policy. Developed countries are aging and their economic dynamics is fundamentally changing and they become prone to having secular stagnation. Japan led the way, Europe and the US will follow.