Governments Are Actually Destroying the Foundations of Society with Their Current Policies of Negative Interest Rates

Since negative interest rates can only exist from state intervention, they are just a euphemism for a tax on savings. What impact do you believe they will have on the economy as they discourage savings and capital formation?

The longer it goes on, the sooner the countries that have negative interest rates are going to start looking like Third World countries. One of the reasons Third World countries are backward is that they don’t have any domestic capital. Why not? Because there aren’t domestic savings. And it takes capital to build things.

Governments are actually destroying the foundations of society with their current policies. It will take a while to happen in the West, because of the tremendous amount of capital that’s been accumulated and saved up over hundreds of years. But sure, they can absolutely destroy it. The Romans did it 2,000 years ago. The Venezuelans and Argentines are showing how to do it today.

—Doug Casey, “Doug Casey on the Disturbing Trend to Tax Savings and Eliminate Cash,” LewRockwell.com, entry posted April 2, 2020, https://www.lewrockwell.com/2020/04/doug-casey/doug-casey-on-the-disturbing-trend-to-tax-savings-and-eliminate-cash/ (accessed April 2, 2020).