Tag: lending

Could this be the dumbest idea on the economy?

So why shouldn’t the Fed just keep cutting interest rates? Why not lower the target interest rate to, say, negative 3 percent?

So suggests Harvard Professor N. Gregory Mankiw in the New York Times.

So, let’s pay people to borrow money?  At a time when household debt is about one whole year of GDP, individuals should borrow more?

If that’s not weird enough, Professor Mankiw goes on to note that no one will lend at negative interest rates.  Unless…