Summary of The Interest Rate Unbound?

Looking for the report?
We have the summary! Get the key insights in just 5 minutes.

The Interest Rate Unbound? summary
Start getting smarter:
or see our plans

Rating

7 Overall

8 Importance

8 Innovation

5 Style


Recommendation

Negative real interest rates, although they sound counterintuitive, have existed at various times in history. Recently, central banks in Switzerland, Denmark, Sweden, Japan and the euro zone have adopted such policies either to manage exchange rates or to provide stimulus in today’s low-growth environment. Economist Jean-Pierre Danthine examines the impacts of such policies. Although his paper is rather technical and would have benefited from editing for clarity, it provides some good nuggets of information about negative rates’ impacts on society. getAbstract suggests Danthine’s eye-opening report to investors, policy makers and executives.

In this summary, you will learn

  • Why some central banks have instituted negative interest rate policies,
  • How effective those policies have been and
  • What social consequences negative interest rates might have.
 

About the Author

Jean-Pierre Danthine is president of the Paris School of Economics.

 

Summary

Five central banks have opted to set their national interest rates below zero. In Switzerland and Denmark, the goals were to safeguard the exchange rate parities of the Swiss franc and the Danish krone, respectively. By early 2015, the interest rates on bank reserves in Switzerland and Denmark were ...

More on this topic

Customers who read this summary also read

Are Negative Rates a “Calamitous Misadventure
Are Negative Rates a “Calamitous Misadventure"? ECB Economists Say No
9
World Economic Outlook October 2016
World Economic Outlook October 2016
8
The Most Important Number in Finance Is Going Away. Wall St. Isn’t Prepared.
The Most Important Number in Finance Is Going Away. Wall St. Isn’t Prepared.
8
Measuring Interest Rate Risk in the Very Long Term
Measuring Interest Rate Risk in the Very Long Term
8
How to Speak Money
How to Speak Money
8
An Early Experiment with “Permazero”
An Early Experiment with “Permazero”
7

Related Channels

Comment on this summary