HSBC’s Major Says Public, Private Sectors Cannot Afford Higher Rates

The video discusses the challenges of rising interest rates due to excessive debt and the impact of the virus on the economy, leading to a potential recession. It explores the concept of disinflation and the possibility of negative interest rates, particularly in the UK. The historical context of negative rates in major economies is examined, highlighting the US as an outlier with past rate hikes. The video concludes with a discussion on the resistance to negative rates, driven by the banking lobby and the existence of cash.

What is one reason mentioned for why interest rates cannot rise?

• The economy is too strong.

• There is excessive debt that makes higher rates unaffordable.

• Inflation is too high.

• Central banks are unwilling to change rates.

What economic event is said to have accelerated a shift towards a weaker economy?

• The recent virus outbreak

• The Brexit vote

• The introduction of cryptocurrency

• The financial crisis of 2008

Which country was an outlier in 2018 due to rate hikes?

• United States

• Switzerland

• Denmark

• United Kingdom

What is a significant barrier to implementing negative interest rates?

• Lack of technology

• High inflation rates

• The existence of cash

• Public opposition

What is one reason for the strong resistance to negative policy rates in the US?

• High unemployment rates

• The influence of the banking lobby

• Lack of government support

• Strong economic growth