Negative Rates Impair Prosperity

"Negative, negative!"
--Lt Chris Burnett (Behind Enemy Lines)

Daniel Lacalle is correct. Negative interest rates are not a gift that enables prosperity. They amount to enormous wealth transfers from savers and the efficient to debtors and the inefficient.

Financial repression is not a gift. It is a huge transfer of wealth from savers and the efficient to the indebted and inefficient. You' may think it's great that countries are financed at negative rates... Until you see your deposits and pension fund disappear. pic.twitter.com/8KaQLb0eZE

— Daniel Lacalle (@dlacalle_IA) June 22, 2019

In prolonged negative rate environments, productivity and prosperity are destined to fall.