Alasdair Macleod: From ZIRP to NIRP

1:34p ET Thursday, September 24, 2015

Dear Friend of GATA and Gold:

GoldMoney research director Alasdair Macleod today nails the madness of the increasing contemplation by central bankers of a policy of negative interest rates.

"By forcing people into paying to maintain cash and bank deposits," Macleod writes, "central bankers are playing fast and loose with the public's patient acceptance that state-issued money actually has any value at all. There is a tension between this cavalier macroeconomic attitude and what amounts to a prospective tax on personal liquidity.

"Furthermore, negative interest rate policy makes the hidden tax of monetary inflation, of which the public is generally unaware, suddenly very visible. Already zero interest rate policy has created enormous unfunded pension liabilities in both private and public sectors, by requiring greater levels of capital to fund a given income stream. Savers are generally unaware of this problem. But how do you value pension liabilities with NIRP? Anyone with savings, which is the majority of consumers, is due for a very rude awakening."

Macleod's analysis is headlined "From ZIRP to NIRP" and it's posted at GoldMoney here:

https://www.goldmoney.com/research/analysis/from-zirp-to-nirp?gmrefcode=...

CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.
CPowell@GATA.org