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A comment on How Low Can Central Banks Go? JPMorgan Reckons Way Lower. Parent comment

Re:How Low Can Central Banks Go? JPMorgan Reckons Way Lower by dav-ycombinator on Wednesday February 10, 2016 @09:57PM (#11077956)
You are looking at a car driving on a hilly road. The car's engine is not powerful enough. You observe that on the uphills, the driver is flooring the gas pedal and yet the speed of the car is decreasing. Confusing correlation and causation leads to the faulty conclusion => the gas pedal must really be the brake pedal

Enabling (arbitrarily) negative rates is equivalent to lifting the power limit on the engine and would simply allow the driver to keep the car at constant speed on all hills (the brakes already have unlimited power)

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Re:How Low Can Central Banks Go? JPMorgan Reckons Way Lower by toyg on Thursday February 11, 2016 @04:31AM (#11079164)
Except this driver has a stake in petrol companies and he does not pay for his petrol, so he gets richer the more fuel is blown while standing still. By the time you've taken out any "power limit", he's just blocked the gearbox on neutral and revving, while shouting "it's not going anywhere! I need more power!"

The economy is not physics - it's psychology.

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Re:How Low Can Central Banks Go? JPMorgan Reckons Way Lower by dav-ycombinator on Thursday February 11, 2016 @08:19AM (#11079912)
Ok. With that kind of argument, I suppose anything can make sense.
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Re:How Low Can Central Banks Go? JPMorgan Reckons Way Lower by collyw on Thursday February 11, 2016 @03:30PM (#11082969)
Come one, its not worse than anything that professional economists come up with. They can't even agree on things amongst themselves.
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Re:How Low Can Central Banks Go? JPMorgan Reckons Way Lower by dav-ycombinator on Thursday February 11, 2016 @06:05PM (#11084049)
Economists agree much more often than not. But that doesn't seem to matter, even when nearly 100% of economists agree on something, the public think it knows better...

http://www.economist.com/news/finance-and-economics/21569378...

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