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View Full Version : Another daft idea from the Spanish government


OFSO
5th Jun 2014, 20:11
The Spanish government is introducing a system of bank loans with negative interest for businesses. In order to make it attractive for businesses to borrow money the bank will pay the businesses a small amount of interest each month on the money they loan.

Whether this idea will prove attractive to banks is another matter.

mixture
5th Jun 2014, 21:37
OFSO,

This isn't related to today's announcement by Mr Draghi (he of the ECB) to reduce the interest rate on deposit facilities by 10 basis points to minus -0.10% is it ?

OFSO
6th Jun 2014, 07:19
Related yes, but the reduction in the interest rate is pan-European, the Spanish government is allowed* to make idiotic decisions on a national basis-

Quote from the Spanish Prime Minister Rajoy on the latest moves for Catalan independence: This is not a time (because the King is abdicating) to push unimportant political matters. Of course there will never come a time to discuss Catalan independence as far as Rajoy is concerned.

Edited to say national governments are not just allowed but ENCOURAGED to make idiotic policy decisions where these (the IPD's) fall in with EU programs and ideas.

Capetonian
6th Jun 2014, 08:21
One has to wonder what these chumps have been smoking.

Negative interest is just another way of saying 'tax on savings is coming'. It was bound to come, it's a little more subtle than the Cyprus style thefts which took place but it's the same. I saw this coming and a few years ago started keeping my Euros 'under the mattress', so to speak.

This will spread.

http://www.telegraph.co.uk/finance/bank-of-england/10879560/Interest-rates-are-entering-the-twilight-zone.html