If you don’t comprehend the nature of NEGATIVE INTEREST RATES, then you are missing out.
Imagine where the future is WORTH LESS than today? Negative Interest Rates is where people are PAID to lose money. Negative Interest Rates are where two birds in hand are greater than one in the bush. Negative Interest Rates are a mechanism of debt destruction, literally. The whole idea of a NEGATIVE MARGINAL UTILITY of New Debt is that Debt Saturation has been reached and surpassed. Negative Interest Rates also indicate Debt Saturation.
How can the Fed claim that it creates inflation when the natural inflation rate RIGHT NOW is negative? Real Interest Rates are equal to bond yield minus monetary inflation.
If we measure Consumer Inflation using the metrics from 1980, consumer inflation is about 8.5%, and the 1990 metric is 5%. The Consumer Inflation today is hedonistically manipulated to indicate what they want it to indicate. Bond Yields are between 0.23 and 2.63. Real Interest Rates are definitively negative.
Wage Growth is Negative, even for PhDs now. Bank Debt, Personal Debt, Government Debt, Corporate Debt are all through the roof. The GDP to Federal Debt is officially now over 104%. Unofficially, the Federal Debt over 300% according to the Government Accounting Office Audits of the Official Governmental Service Corporation Books. This is to say, they are “hiding” over 200% of the debt owed using accounting tricks, legal hacks, and rehypothication. The greatest Bubble of them all is the DEBT BUBBLE because debt is used as “money.” Thankfully there is sanity to the new age monetary systems such as BRICS and AIIG.
The US and Global Stock Markets are farces with the Mathematically “artificial Intelligence” High Frequency Trading Computer “Robots” basically CONTROLLING virtually EVERY market on the planet via faster access than everyone else. The Financial Singularity has come and gone (in my opinion), as there is nothing but Head-line reading computer software driving the markets now.
Options are used to amplify the influence of the money 100+ fold. Double, triple fold options funds can render 1,000-1,000,000 amplification of money. Today amplification of option/fund changes not so much “directly through the fund” than through these computer programs read all the movements of all the stocks and then use the implied changes to magnify distortions in OTHER markets in the direction and scale of correlation.
This is a Computer Software Issue.
The Financial Singularity occurred many many years ago. There is only a computer at the controls of the “stock/financial/economic market”, for the most part now…. and they aren’t smart enough to KNOW what HUMANS need. More debt is not what we need. More Debt is pretty much the only thing that the FEDERAL RESERVE has been training these softwares on and with for the last 8 years or so. They can get “cranky” if they don’t get it! Neural Networks are TRAINED into doing this stuff. the High Frequency Trading uses Neural Networks.
There is basically a large multidimensional matrix of numbers corresponding to each stock, how they relate to each other (by a scalar number, usually), and other related element correlations such as headline readers. There have been occasions where head-line readers MIS-INTERPERT the news, press release, announcement, tweets, etc and have cause stocks to move when they shouldn’t or in the opposite direction; such as with Tesla Motors.
These High Frequency Trading Robots are not accustomed to no new debt. This may be a reason why the FEDERAL RESERVE continuously TALKS UP the market with propaganda… for the Head-line reading robots. For the last 8 years, the full US Economic Recovery has been three months away, perpetually.
As the amount of debt shrinks, there is no telling what these HFT robots can do. We saw that they can destroy “Trillions of dollars of Debt Wealth” in mere minutes as seen by the Flash Crash.
Using Debt as Money when it definitively and unilaterally needs to be issued in every increasing amounts, yet Debt Saturation has been reached and the Debt Bubble is burst… Houston, UNITED STATES, INC has a problem.