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FSN: Negative Interest Rates Spell Final Defeat for Beleaguered Savers
Be prepared for the next great transfer of wealth. Buy physical silver and storable food.
Market interest rates are once again sending out some very disturbing signals – ones that are suggestive of a very hard landing indeed for the global economy.
by Jeremy Warner
Telegraph.co.uk
Ignore, for the moment, what has happened to bond yields in the troubled eurozone periphery. That is an unnecessary tragedy unique to certain members of the euro. The bigger story is that across large parts of Europe, nominal interest rates are turning negative. Germany, the Netherlands, Finland, Denmark, Austria and Switzerland are already there, and now there is even some possibility of the UK joining them.
Last week, the yield on two-year gilts reached a record low, and though it has come back a bit since – boosted by the possibly mistaken belief that Mario Draghi, president of the European Central Bank, is about to come riding to the rescue in the eurozone debt crisis – it still hovers at an almost unbelievable 0.05pc. Real yields on index-linked gilts have been negative for some years now, but this is the first time that nominal yields have looked like joining them.
Continue Reading at Telegraph.co.uk…
2012-08-07 00:15:05
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