[orange_joe]

My understanding is that Dutch banks already have negative interest rates. They charge a negative interest to large account holders (over 1M euros) and a minimal positive rate for less wealthy clients. In reality I suspect that few end up in the 1M+ category since you can spread your money and keep the rest invested in the stock market or T-Bills if you really want security.

[GekkePrutser]

It's above 250.000 now..

I don't have that much but mind you, even at a slight positive rate (like 0.1%) you're already losing money every year due to inflation!

It's really ridiculous.. My confidence in the banking system is super low. I feel like they're just screwing us with the ECB's blessing (who initiated the low interests).

[frockington1]

Any idea what happens when T-Bills go negative as happens in Germany? Do people hoard physical cash or gold?

[orange_joe]

I assume you just find rock solid corporate bonds. Apple issues bonds and they have assets far in excess of their debt load + massive profitability. Realistically as an individual you just move into equities. Institutions have different equations. Hoarding physical cash is probably not a good idea, since you have inflation (which probably exceeds the negative rate by quite a bit). It’s worth mentioning that cash holdings in a bank already have negative real growth because inflation exceeds interest (at least in my shitty low interest savings account)

[after_care]

Hoarding highly liquid physical assets like gold or paper requires security which costs money. The negative interest rates are cheaper than buying equivalent security.