Negative interest rates: Staying power for the long term?

Central banks worldwide have increasingly responded to difficult economic conditions with unconventional monetary policies, including negative interest rates in a number of countries. Chungwei Hsia, a fixed income sovereign analyst, offers his views on the negative rates that have materialized from quantitative easing efforts, and whether they are a short-term solution.

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instead of setting the raid we are actually pumping the Fed was pumping money into the system so you have a garden hose and you connect that to a fire hydrant and now you're trying to push the money through in the sense that the Central Bank started to scratch their head and said well maybe we should go below zero and see what happens but I do anticipate that the low rate or in and around the 0% I will be with us for a long time and here are the reason number one low rates are supposed to be stimulating the economy but if you look at the flip side of it taking away low rate means that we are anticipating a better growth which we haven't been seeing number to some of the I'm more aggressive balance sheet probably would not survive a higher rate so if I were the Central Bank Governor I will be very worried that when is the good fit right time to take away the low rate I was once an engineer and if I look at this economic activity as in the form of waves that business cycle the wave hits now has become really really tiny the amplitude of small but the frequency is higher because we are trying to escape from this is slow growth mode but there is really not a good reason why we do have that organic strength which brings back to what we were talking about just now that Central Bankers are concerned about raising Ray they don't want to be responsible for taking the economy down into a recession but as we all know in every economy is just one shock away from recession does in order for the rate rate to go up the central bank will have to be very cautious

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