Posted on 02/11/2016 9:40:48 AM PST by xzins
As recession fears mount in the U.S., Fed Chair Janet Yellen conceded there's a "chance" of a downturn ahead.
Asked by Republican Sen. Bob Corker whether the monetary policy-making Federal Open Market Committee would consider going to negative interest rates, which would entail charging banks to store reserves at the Fed, Yellen left the door open. She repeated a statement she said Wednesday that the Fed had considered negative rates in 2010 but decided that wouldn't be the best course at that time.
"We wouldn't take those off the table, but we have work to do to judge whether they would be workable here," she said.
Banks currently have $2.27 trillion in reserves at the Fed, compared to the required $117.3 billion required. The Fed pays a 0.5 rate on those deposits.
Toomey also questioned whether a negative IOER rate would end up seeing savers pay a fee to keep money at banks. Yellen said she does not believe that is the case of the European countries where it has been tried.
If you Love your Economy you can keep your Economy! 401K not so much!
Negative rates? Time to invest in mattress futures.
I took what few thousands I actually had in a savings account and put the cash in a couple safes in different locations.
I got tired of my interest putting me in a higher tax bracket ;/
Just wait till the Bern confiscates your 401K and IRAs to fund an expanded national social security system.
The leftists are probably salivating over a plan which further sours your view of the banks. Sanders has made it plain that he wants to break up the big banks. Of course, that means to have the Federal government take over banking like they have taken over healthcare.
It’s amazing to me how the left does not see how their policies mirror fascism.
what was the purpose of QE 1...QE4?
Add liquidity and reserves to the banking system. Lower long term interest rates.
Any chance that asteroid won't miss the planet?
I have a share account on which I was drawing .001% interest last year.
Given inflation, I suppose I’m losing money.
“Then the mark on the forehead...”
chip
Any change like that will not come until after the election when most folks are not paying attention.
“Would they at least get a free toaster out of the deal? “
No. If interest rates go negative, YOU have to give the BANK a toaster to open an account.
Can we just give them toast?
So banks have had bad assets taken off their books and been filled with cash, which for the most part, seems to have gone to blowing bubbles in financial assets. Long term interest rates continue to drop while short term rates are near zero.
Is this soviet-style central planning working??
My kids gave me a George Foreman grill, and it is AWESOME!
Hasn’t the crazy woman heard of safe deposit boxes.
For people with lots of money, they’ll just buy the daily cash receipts off retailers.
Wait until just about all the printed dollars disappear to see how Democrats can ruin an economy.
Personally, I’ve already thought about burying money in PVC pipe because I’m so angry over low interest rates.
My car dealer Congressman wants cheap money. I’ll be needing a job if this keeps. His pays well.
Can you actually get grill marks on steaks?
put your money in something with value: buy a gun, take care of it, and in 20 years it will have retained its value at current value.
Negative interest means cash bans, so it’s not shocking that people are rushing into PMs.
Deutch Banks and a lot of euro banks have incredible exposure to derivatives. US banks have heavy exposure to oil companies.
I would think that we are going to see the outright nationalization of banks. That way, as arms of the government, the banks would have the authority to confiscate anything, cash, gold, homes etc.
Totalitarianism such as we’ve never seen. The Beast is at the door.
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