ECB cutting rates…Implications?

[FlyerInHi]

jazzman, but lacking fiscal solutions, central bankers have no choice but to push the limits of monetary policy.

Ideally, fiscal and monetary solutions would be complementary.

Growth wise, the USA is doing better because we implemented some limited fiscal stimulus and the Fed moved more decisively with monetary policy.

[scaredyclassic]

[quote=flu][quote=scaredyclassic][quote=livinincali][quote=scaredyclassic]
instead of steadily eroding savings, wouldn’t it be more effective to have it be done randomly and in larger chunks/ Anyone who leaves cash in the bank for over 6 months, say, can randomly have a 2% chunk sliced away, say up to 3x a year. it’s done randomly by a computer. the money goes toward military operations to ensure dominance of the currency. this way, people will go out and spend it all..[/quote]

That would produce one hell of a bank run. With reserve lending every bank in America would be bankrupt in that scenario. Perhaps that is a good thing.[/quote]

even if it wre just once a year, people wouldnt tolerate it. they prefer to boil to death slowly and uniformly, rather than get hacked it brutally and quickly…[/quote]

Well, I think the solution is simple. Americans love to gamble. So make the game have odds…..

That is.

If you deposit money for a full year in a bank account, you have a 10:1 odd of winning the grand prize of getting a surprise 10% increase that year… The remaining 9 people will lose 2%….
With 10 people playing one person would win 10%, 9 people would lose a total of 2% each, and there would be plenty of money left over for the government to finance it’s war problem ,drug problem, etc…[/quote]

I think this could work. Mandatory lottery for the good of the nation

[an]

[quote=scaredyclassic][quote=flu][quote=scaredyclassic][quote=livinincali][quote=scaredyclassic]
instead of steadily eroding savings, wouldn’t it be more effective to have it be done randomly and in larger chunks/ Anyone who leaves cash in the bank for over 6 months, say, can randomly have a 2% chunk sliced away, say up to 3x a year. it’s done randomly by a computer. the money goes toward military operations to ensure dominance of the currency. this way, people will go out and spend it all..[/quote]

That would produce one hell of a bank run. With reserve lending every bank in America would be bankrupt in that scenario. Perhaps that is a good thing.[/quote]

even if it wre just once a year, people wouldnt tolerate it. they prefer to boil to death slowly and uniformly, rather than get hacked it brutally and quickly…[/quote]

Well, I think the solution is simple. Americans love to gamble. So make the game have odds…..

That is.

If you deposit money for a full year in a bank account, you have a 10:1 odd of winning the grand prize of getting a surprise 10% increase that year… The remaining 9 people will lose 2%….
With 10 people playing one person would win 10%, 9 people would lose a total of 2% each, and there would be plenty of money left over for the government to finance it’s war problem ,drug problem, etc…[/quote]

I think this could work. Mandatory lottery for the good of the nation[/quote]I rather gamble on the RE and stock market.

[Jazzman]

[quote=FlyerInHi]jazzman, but lacking fiscal solutions, central bankers have no choice but to push the limits of monetary policy.

Ideally, fiscal and monetary solutions would be complementary.

Growth wise, the USA is doing better because we implemented some limited fiscal stimulus and the Fed moved more decisively with monetary policy.[/quote]
Yes, I agree but QE is Europe is difficult I think mainly because it is far more complex to do. You already have 18 central banks and a more fragmented market. The effect on asset appreciation is also going to be muted since there is generally less participation in financial and housing markets. If it was a no-brainer, bureaucracy notwithstanding, I think we’d have seen it happen by now.

[spdrun]

Actually, housing markets in Europe are often quite strictly controlled. Sometimes to control appreciation — i.e. flips in Germany are basically forbidden.

[Author]

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