Once, it was a good thing to have money in the bank.
Now, Danish companies pay taxes early to rid themselves of cash. At one small Swiss bank, customer deposits will SHRINK by an eighth of a percent a year—not after inflation. Before inflation. It actually is more profitable to keep money in the mattress than the bank.
But it isn’t all bad. Some Danes with floating-rate mortgages are discovering that their banks are paying THEM every month to borrow, instead of charging interest on their home loans.
Such is life in the upside-down world of negative interest rates, in which banks impose a LEVY on customers to hold their money, instead of paying interest on deposits. And its not in a Grimm Fairy tale. Its happening about thirteen hours away in Europe.
Steve and Sinclair review an intriguing Wall Street Journal report on why rates are falling below zero in Europe and how it could happen here.
In the Q & A segment, CFP and Certified Investment Management Analyst Murray Titterington with IQ Wealth joins the A-Team to analyze portfolio strategy life expectancies.