Virtual Negative Rates

One of the biggest stories of the month – swamped by the District of Circus and the viral news of out China, is  that the World continues effectively in negative rates.

What follows is a roadmap as to how this works and why so many people aren’t understanding the mechanics of what’s ahead.  Gold and oil are screaming “There’s more inflation than recognized.”  So are housing prices.

Before that, however, we’ll first check a few headlines and roll through our ChartPack because it’s a difficult time to keep track of so many moving pieces

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22 thoughts on “Virtual Negative Rates”


    2019 Novel Coronavirus (2019-nCoV) in the U.S.

    Updated January 27, 2020

    CDC is closely monitoring an outbreak of respiratory illness caused by a novel (new) coronavirus named 2019-nCoV. The outbreak first started in Wuhan, China, but cases have been identified in a growing number of other international locations, including the United States. CDC will update the following U.S. map daily. Information regarding the number of people under investigation will be updated regularly on Mondays, Wednesdays, and Fridays.
    Patients Under Investigation (PUI) in the United States*†

    As of 1/27/2020
    People under Investigation (PUI) in the United States
    Positive 5
    Negative 32
    Pending§ 73
    Total 110

    *Cumulative since January 21, 2020.
    † Numbers closed out at 7 p.m. the night before reporting.
    §Includes specimens received and awaiting testing, as well as specimens in route to CDC.

    Number of states with PUI: 26


    • No worries Jim .. The CDC really is a great organization and will do the best to contain any contagious disease out there. I’ve seen them work up front and personal on the floors..they’re quick smart and will do the job..

      In my opinion they rank right up there with NASA…

  2. Why George what did you think the dog and pony show in Washington was all about anyway except a big attention grabber, and you won’t know whats been slid under the radar until its all in place an over and a done deal, and of course the only losers are the people,and yet I surmise you already suspect it.People thought that Trump was that knight in shinning armor mounted on a steed snorting fire and brimestone, who had come to save the people from themselves,they can’t face the fact that Trumps one of those that you thought had come to save you but who in reality was one of them.!!!

    • bluedogg, I concur.
      Favorite quote “Deception works best…when the person doing the deceiving is fool enough to be deceived, too; that is, when he believes his own lies. That is why incompetent leaders — who are naïve enough to fall for their own guff — are such a danger to civilized life. If they are modern leaders, they must also delude themselves into thinking they know how to make the world a better place. Invariably, the answers they propose to problems are ones that bubble up from their own vanity, the essence of which is to make the rest of the world look just like them!”~Bill Bonner

      • Bill Bonner is exactly the type of sensible financier and strong voice of the wealth management crowd that should be a role model for America…He puts things in-respective and gets how the world is run…he is the opposite of the [political comment redacted]

        Do all of you realize how you all demean the human race when [unwarranted political remark – this article is about Bernanke’s rate analysis, not politics!]

        Support and idolize an computer, structural and bio engineer, a mathematician, a scientist, an Astro-physicist, a doctor, biologist, and many more that take that extra step in their educations to make a difference in the world. These people are the drivers of our wealth, leadership, and status in the world marketplace. They create jobs…not some [another political redact].

        George Notes: Stick to the article content. I you need to vent, go to Iowa or New Hampshire. We’ve had that discussion before…

    • Simmer down. Lol. We already know who the next elected president will be. Lol.

      As we knew Trump would be long before he stated his candidacy. And when nobody thought he would win the Republican nomination? We knew he would be president.

      Just like we know Bernie Sanders will be the next elected president. as was stated on this site in the comment section waaaay back in July ish of last year. Back when he was showing in the polls were showing anything of substance. Now look at bernie go. Go bernie go. Power to the people and all that jazz.

      It was all just crazy talk back then and even further back before that it was also stated Dow 32,000. Back when it was Dow 20k and some change.

      Hello. I do appologise for my miss account on things with Inda and Pakastan as it related to common knowledge.

      I knew when I asked the council for an additional year extension… somethings would change.

      And so would I. It’s good for me not to be right all the time. Lol.

      Long time no talk.

      Hope you have all been behaving.

      • Ain’t Misbehaving Lyrics:

        No one to talk with
        All by myself
        No one to walk with
        But I’m happy
        On the shelf
        Ain’t misbehavin’
        I’m savin’ my love for you

        I know for certain
        The one I love
        I’m through with flirtin’
        It’s you that I’m thinkin’ of
        Ain’t misbehavin’
        I’m savin’ my love for you

        Like Jack Horner
        In the corner
        Don’t go nowhere
        What do I care?
        Your kisses
        Are worth waitin’ for
        Believe me

        I don’t stay out late
        Don’t care to go
        I’m home about eight
        Just me and my radio
        Ain’t misbehavin’
        I’m savin’ my love for you
        Ain’t misbehavin’
        I’m savin’ my love for you.

        Welcome back, Andy!

      • I seem to remember a prediction that the successful candidate would never take the oath. Or am I just getting gossip confused? Welcome back.

    • “Trumps one of those that you thought had come to save you but who in reality was one of them.!!!”

      I realized that also when he missed his ONE chance after being sworn in as “commander in chief.” It’s going to be “Bolsheviks” all the way, not because I like it — it’s US!!

  3. If, in today’s ludicrous financial world, the Fed can make up any amount of money and inject QE at will why was it the banks were going to CON-gress back in ’08 for massive loans that had to be voted through and given immediately?

    But, truth be told, we’ve been dealing with negative returns for many years given actual inflation, low/no interest on our deposits and the service charges we have to endure. Lumpy mattresses look better all the time.

  4. Morning cupcake. As per our email exchange a while back I figured I’d best be a man of my word and pop in for a little bit.

    It’s good for me to take a little break from the written thoughts found here. People being creatures of habbit and my unique ability at pattern recognition.. it becomes a bit uhmm repetitive for me.

    Yes, I missed you all too. It’s amazing how many people I know from all around the globe. And I’m really good at interpersonal relationships and networking. I met a Brazilian psychiatrist about a month ago who is also a “suicide girl” on Instagram. A tattooed bikini model with a dash of “steam punk”. She actually told me she wanted to fall in love again, would love to travel to the US to meet me, I wouldnt have to pay for anything, she would book her own flight, hotel etc.

    I dont know. I dont know. I fell in love and she ghosted me. Maybe its because of the attention I get from other females. Or maybe I’m just an asshole. Sometimes that must be it.

    I’m going to have some coffee and think about something besides myself. Lol

    I should be around for a little while. As always, this not trading advice and you are responsible for your participation in the creation of our future. I’m not Howard Cosel, calling the play shots from the box on Monday Night. I’m just a regular joe with a hunch.

    Ohhh and I feel like I fit right in around here because you’re all a bunch of long winded bastards. Lol

    I will take what is

    F bitcoin for $500 Alex.

    Congratulations Andy that is the daily double.


    • “long winded bastards. Lol”


      First off it’s great to see yuh ou back…Lol lol my wife always tells me.. ten words or less.and. your opinion is your opinion and jo one cares about your opinion more than you.. I tell her.. I am not a ten word guy.. lol lol so I know I am long winded lol.. good to see you back .
      Now to see some posts from Expat..then the gang will all be here. I haven’t seen any posts from Patrick the earthquake guy either for a while..

  5. About the One percenters getting the made up money…. Nice situation if you can get it. Makes Me damn SICK.

  6. I think the world is running effectively on negative rates because investors (savers)
    have been numbed by so many years of near zero returns that they hardly notice
    the difference.

    How financial institutions get away with charging such high rates for Credit Cards
    is, on the other hand, more of a mystery.

    • well I ran my mouth and said gold will end the Fed,,go 49ers
      well our President tweeted stand with your commander in chiefs, yes, he made it plural, now I am with Kansas to win the stupid bowl. and don’t forget what the Sec. of State’s nick name is.


  7. George -get em while their hot..or not.

    Bitcoin is breaking thru 200 MA – its on to the next level of resistance..

    GBTC/ Bitcoin Grayscale Trust is breaking thru 200 MA as well.

    Thing is not only are they extremely limited, but the mining reward is soon to be cut in half – the halving.

    How are those FRN’s holding up ? Seems to this unbiased observer that your beloved US Dollar is getting more diluted by the second..60 seconds in a minute – 60 minutes in an hour, 24 hours a day – 365 days a year – US Treasury new motto “the solution to pollution is dilution”

    Care guess how many ounces of GOLD the TBN can buy today versus Jan 29,2019 with his lone Bitcoin? bout 6..ounces!

    How bout dem Bitcoins?!

    and that boys and girls is your financial lesson for the day..

    NO Bitcoin 4 U !

    • Zerohedge posted the photo, email, and phone number of the researcher who they think headed up the coronavirus unit at that lab. His area of academic research dealt with bat”s ability to act as carriers of deadly viruses. Extending incubation period indefinitely in a small percentage of the victims would be a goal in weaponizing a virus.

      I think that NK and Russia are getting their response right.

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