{"id":6684,"date":"2015-03-21T08:45:28","date_gmt":"2015-03-21T13:45:28","guid":{"rendered":"http:\/\/olduvai.ca\/?p=6684"},"modified":"2015-03-21T08:45:28","modified_gmt":"2015-03-21T13:45:28","slug":"dumping-american-junk-in-europe-draghi-asked-for-it","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=6684","title":{"rendered":"Dumping American Junk in Europe, Draghi Asked for it"},"content":{"rendered":"<h3 class=\"entry-title\"><a href=\"http:\/\/wolfstreet.com\/2015\/03\/20\/dumping-american-junk-bons-in-europe-draghi-ecb-asks-for-it\/\" target=\"_blank\">Dumping American Junk in Europe, Draghi Asked for it<\/a><\/h3>\n<p>This is just the beginning, a new trend that may well turn into the next craze. ECB President Mario Draghi, in his infinite wisdom, asked for it: he\u2019d driven the ECB deposit rate deeper into the negative, to -0.2%, and has promised to buy \u20ac60 billion of assets a month, including Eurozone government debt, other debt, and even, as German politician Frank Sch\u00e4ffler had predicted so poignantly in July 2012, \u201cold bicycles.\u201d<\/p>\n<p>The ECB would buy this debt from its favorite banks, driving up the price so high that the yield would drop to -0.2%, same as the deposit rate. These banks are going to make a killing on the deal. And yields of Eurozone government debt have been plunging, with the German 10-year yield now at 0.15% on its way to -0.2%.<\/p>\n<p>The goal: Make investors\u00a0<em>pay<\/em>\u00a0for the privilege of funding all governments across the Eurozone, just like depositors are being made to pay for the privilege of lending their hard-earned money to shaky banks.<\/p>\n<p>Insurance companies, but also other financial institutions, hold high-grade bonds to create predicable income streams into the future with which to pay the promises they made to holders of their life insurance policies and annuities \u2013 a big part of the private pension system. But as yields are turning negative, future income streams fizzle. It\u2019s undermining an entire retirement\u00a0system.<\/p>\n<p>&nbsp;<\/p>\n<p>&#8230;click on the above link to read the rest of the article&#8230;<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Dumping American Junk in Europe, Draghi Asked for it This is just the beginning, a new trend that may well turn into the next craze. ECB President Mario Draghi, in his infinite wisdom, asked for it: he\u2019d driven the ECB deposit rate deeper into the negative, to -0.2%, and has promised to buy \u20ac60 billion [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2],"tags":[63,88,124,195,233,282,1044,827,4254,4255],"class_list":["post-6684","post","type-post","status-publish","format-standard","hentry","category-economics","tag-banks","tag-bonds","tag-central-banks","tag-debt","tag-ecb","tag-european-central-bank","tag-mario-draghi","tag-united-states","tag-wolf-richter","tag-wolfstreet"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/6684","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=6684"}],"version-history":[{"count":1,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/6684\/revisions"}],"predecessor-version":[{"id":6685,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/6684\/revisions\/6685"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=6684"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=6684"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=6684"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}