How many times have you heard that expression? You get excited by what you thought was a bargain, only to be disappointed that the quality or performance failed to live up to your expectations. The ringing in our ears comes again and again-You get what you pay for.
Does anyone really believe that success doesn’t come with a price, whether it is in sports, entertainment, construction, finance or even medicine? We will pay for the best. No one wants to be operated on by the cheapest surgeon, have his house built with the cheapest materials, or travel on a plane built with parts that have just gotten by tolerance.
Yet the Keynesians believe that the cheaper the money the greater the demand that can be created. Reaching zero should not be a roadblock to this failed thinking.
Thus, Mario Draghi, Chairman of the European Central Bank, announced this past week the deposit rates at European banks would go negative.
Low rates have done nothing to reduce the ever rising unemployment. The corporate demand for loans continues to be nonexistent. The economies continue to falter as people continue to look for day to day survival.
High interest rates didn’t work. Lower interest rates didn’t work. Now we are asked to believe that negative interest rates will be the panacea.
IT’S NOT THE RATES THAT ARE THE PROBLEM.
My suggestion to Mario, if he wants to persist in this approach, like all central bankers are doing, is simply follow the lead of the United States government and declare victory over 25% unemployment. Don’t count the non-workers. Take the most successful restaurant and retail shops in
Of course, you must control your mainstream media so no pictures are shown of your people suffering.
Negative interest rates are the cheapest of the cheap and very few lasting successes have been built on cheap. However, with a little PR, the mass may become believers. After all, isn’t two Presidents declaring victory in
You Get What You Pay For