Link: https://www.kamakuraco.com/wp-content/uploads/2021/01/Kamakura-NegativeRatesIACPM20200722v2.1.pdf
Graphic:
Excerpt:
What Can Go Wrong?
• Rate and Default Interaction
• Impairment to the Banking System
• Massive challenges to the Insurance Industry and Pension Funds
• Central Banks cannot force institutions to lend or creditworthy borrowers to borrow
• Huge overhang for refi in next 5 years
• “Negative Rates Cannot Cure Problems that Caused Rates to go Negative”
Author(s): Prof. Robert Jarrow, Donald R. van Deventer, Martin Zorn
Publication Date: 22 July 2020
Publication Site: Kamakura Corporation