Negative rates are the destruction of money, an economic aberration based on the mistakes of many central banks and some of their economists who start from a wrong diagnosis: the idea that economic agents do not take more credit or invest more because they choose to save too much and therefore saving must be penalized to stimulate the economy. Excuse the bluntness, but it is a ludicrous idea.

Economist Thomas Piketty, creator of some of the most absurd proposals embraced by the extreme left, has published an article in which he demands a cancellation of government debt in the hands of the European Central Bank “in exchange for greater public investment” … which, by the way, would be paid with more issuance of public debt. Fascinating.

Luís de Guindos, vice president of the ECB, has settled the controversy with two pieces of evidence. “Cancelling the debt (in the ECB balance sheet) is illegal and also does not make economic sense,” he explained to Reuters on February 4^th, 2020. The first part is obvious. It is prohibited by the bylaws of the European Central Bank. I will explain the lack of economic logic here.