Barkley Rosser at Econospeak raises the entertaining prospect that, in the States at least, base rate may actually fall below 0% in a deflationary situation. (Actually, he says it sometimes already has temporarily in the past, but now there's a theoretical case for it doing so long term).
So the government would be paying the banks - and anyone else who borrowed off them - to take their money. But if I understand him right - and let's never take that for granted - it only works for the seriously rich because they're the ones who don't have a 'cash alternative'.
I think that means that if we really are in a Titanic situation, economically speaking, we now have a design of a lifeboat big enough to take the iceberg.
Addendum: via I discover the l-curve, a site that illustrates the income distribution in the States using a football field visual metaphor. It's fun - remember to zoom in (x2) and then go back to the start and zoom out (x3).
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