Anudeep Bikkina

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The cult of the expert – and how it collapsed | Sebastian Mallaby

Led by a class of omnipotent central bankers, experts have gained extraordinary political power. Will a populist backlash shatter their technocratic dream?<p>On Tuesday 16 September 2008, early in the afternoon, a self-effacing professor with a neatly clipped beard sat with the president in the …

Alan Greenspan

Europe’s QE Quandary

It’s the new conventional wisdom: When all else fails to make economies grow, create new money and buy government bonds. That’s the formula dubbed …

If the message the bond market is sending is right, we should all be terrified

The financial media tend to report breathlessly about what the stock market did yesterday. But savvy economic analysts have always known the bond …

Referendum result adds to Italian banks' woes

<b>The referendum result makes life even more challenging for Italy's banks, after the country voted against Prime Minister Matteo Renzi's proposed constitutional reforms.</b><p>Several banks are trying to raise new money from investors to reinforce their financial foundations.<p>Attention is focused especially …

Economics

As Switzerland Moves to Negative Rates, Finance Enters Uncharted Territory

Having abandoned its policy of capping the Swiss franc’s value versus the euros, the Swiss National Bank needs a Plan B for blocking the destructive, deflationary forces emanating from Switzerland’s struggling neighbors in the eurozone.

Economics

This Is the Real Point of Europe’s Negative Rates

A pickup in inflation is needed to see Europe escape its debt burden<p>Banks and insurers don’t like it, borrowers are seeing little or no benefit from it and savers and pensioners fear their money is being eaten away by it: The policy of negative interest rates is as unpopular as it is mysterious.<p>The …

European Central Bank

How Slightly Negative Rates Can Tear Into Bank Profits

The biggest reductions in income come from the indirect effects, particularly lower interest income on lending and bonds

Dow Jones

Less Than Zero: Living With Negative Interest Rates

There is some good and bad in the upside-down world of negative interest rates, but how this scenario will play out is anyone’s guess<p>Once, it was a good thing to have money in the bank.<p>Now, Danish companies pay taxes early to rid themselves of cash. At one small Swiss bank, customer deposits will …

Interest Rates

Germany: Where Negative Rates Are Lethal

Life insurers feel pain of negative interest rates<p>German life insurers are caught in a pinch that could eventually threaten their survival. Regulators are forcing them to boost capital levels at the same time that low rates make it hard to make money with their investments.<p>The question is how long …

Interest Rates

Everything You Need to Know About Negative Rates

The Bank of Japan, the European Central Bank and several smaller European authorities have ventured into the once-uncharted territory of negative interest rates. But what are negative rates, and how do they come about?<p>The Bank of Japan, the European Central Bank and several smaller European …

Bank of Japan

Negative Rates Around the World: How One Danish Couple Gets Paid Interest on Their Mortgage

In Denmark and Sweden, savings accounts pay nothing and real estate is booming<p>AALBORG, Denmark—Hans Peter Christensen got some unusual news when he opened his most recent mortgage statement. His quarterly interest payment was negative 249 Danish kroner.<p>Instead of paying interest on the loan he got …

Real Estate

Negative Rates: How One Swiss Bank Learned to Live in a Subzero World

When Alternative Bank Schweiz moved to charge depositors, it actually gained account holders<p>ZURICH—Negative interest rates are rattling banks around the world, but one small Swiss lender has learned to stop worrying and lean in.<p>Alternative Bank Schweiz AG late last year became Switzerland’s first …

Swiss Bank

Japan’s Negative-Rate Experiment Is Floundering

Trading withers in money markets, yen goes on a tear; ‘every day is like being Alice in Wonderland’<p>TOKYO—Japan’s two-month experiment with negative interest rates is producing some unexpected results.<p>Trading has withered in Japan’s money markets, where big banks and others usually park their excess …

Bank of Japan

What Comes After Negative Rates? Helicopter Money

For central banks, fantasy monetary policy would mean handing out money directly to the population<p>When modern banking first emerged in medieval Italy, European mathematicians regarded negative numbers as absurd. Six hundred years on, the successors to the Medicis and Peruzzis face negative interest …

High Level

What Negative Interest Rates Mean for the World

As central banks worldwide take the plunge into negative rate territory, policymakers are keeping a close eye on the reaction across markets and economies<p>Central bankers around the world are pushing deeper into the once-unthinkable world of negative interest rates — essentially charging customers …

Interest Rates

Negative Interest Rates: How Do They Work?

Bond Traders See Helicopters Loaded With Money

The bond market is telling us that Milton Friedman's 1969 thought experiment -- freshly created money appearing in people's bank accounts, known as helicopter money -- may be closer than we think.<p>Almost $10 trillion of the world's bonds now yields less than zero, of which more than $6 trillion is …

World faces deflation shock as China devalues yuan at accelerating pace

China has abandoned a solemn pledge to keep its exchange rate stable and is carrying out a systematic devaluation of the yuan, sending a powerful deflationary impulse through a global economy already caught in a 1930s trap.<p>The country’s currency basket has been sliding at an annual pace of 12pc …

Globalization

How a Surprise Upturn in U.S. Growth Could Trigger the Next Recession

Some economists, including a former top IMF official, warn market expectations for weak growth could spark financial turmoil<p>Could the cause of the next U.S. recession be too much growth? That is one risk of an unprecedented environment in which investors are betting heavily on a perpetually weak …

Economics