Under the guise of seeking higher inflation to “stimulate” the economy (and erode the value of people’s savings even more quickly), the European Central Bank (ECB) announced negative interest rates on deposits held at the bank — the first time a major monetary authority has ever set the rate below zero. If that proves to be not enough in its supposed battle against “deflation” or “not enough” inflation, the central planners at the eurozone central bank are threatening to do still more. Already, they are talking about potentially even starting up their own Federal Reserve-style “quantitative easing” gimmicks to gobble up real assets with fiat currency conjured out of thin air. Critics, though, are warning of disaster.
Since the financial crisis began, central banks around the world have been running the proverbial printing presses like never before. In the United States, the privately owned Federal Reserve System bailed out its crony megabanks around the world with literally trillions of dollars — all on the backs of the struggling American people. The Bank of England has been engaged in similar looting. The ECB, meanwhile, despite being slightly more limited in terms of what it can do, has been showering bloated European governments and mega-banks with massive sums of new euros, too.
Apparently, though, it was not enough to satisfy the special interests and central bankers, or “banksters” as they are often called these days by critics. Earlier this month, the ECB, purporting to be concerned about how alleged “deflation” might derail the purported “economic recovery,” announced its newest set of interest rates. Its main refinancing rate is now 0.15 percent, down from 0.25 percent. Meanwhile, the deposit rate — the interest rate paid to banks that deposit funds at the ECB — officially turned negative for the first time ever at -0.10 percent. It was at zero prior to June 11.
At a press conference announcing what many analysts said was the “historic” development, ECB boss Mario Draghi noted that “the rates we've changed are for the banks, not for the people.” In other words, everyday Europeans will not be charged interest merely to deposit funds at the bank — at least not yet. “It's wrong to think we want to ‘expropriate savers,'” added Draghi, a former Goldman Sachs chief and regular attendee at the shadowy Bilderberg summits along with top Big Business and Big Government bosses. Ironically, one of the goals was to depress the euro exchange rate, so savers holding the currency will indeed have part of their wealth expropriated, regardless of what Draghi says.
What the negative deposit rates mean, essentially, is that commercial banks will be penalized for accumulating reserves rather than loaning out all of those fresh euros into the supposed “real” economy. The idea, at least according to the central planners at the ECB, is to force banks to loan out more of the funds to businesses and consumers. That will somehow translate into more “economic recovery.” Apparently creating vast new quantities of currency out of thin air and using those euros to gobble up government bonds was not enough.
Click here to read the entire article.