We know about Europe, but what is the reason? Could it be because of the five European pig countries? You know, in the past, Europe seemed to be quite good, at least much stronger than Japan, and they were doing well with China, and everyone was developing the economy together, so why did something happen? It's so sudden?

Yes, it was really sudden, but if it was really said, then the European thing was actually planted early on!

Is it because of the five European pig countries?

These five are just pig teammates, and what really leads them to the abyss is actually something else.

We've all heard the term negative interest rates.

More than 20 years ago, that is, around 2010, this word appeared more and more in our Chinese's vision, mainly to say that our CPI is growing fast, that is, it seems that inflation is relatively high, and our bank interest is very low, which produces a difference, we call this negative interest rate.

But that's not what negative interest rates mean in Europe.

The negative interest rate in Europe was in 2015, when Europeans went to the bank to take out a loan, if the loan was cleared by the bank, then what was the loan?

The interest charged by the bank means that they have lent you money, but you need to repay the interest, but the bank is now suing you, not only will they not charge interest, but they will also give you the money!-

0.02, it seems to be this interest at the beginning, but it doesn't seem to be high, and the bank doesn't give you much money, but. It's fucking giving you money again!

To put it simply, it was after the European banks at that time lent out 100 yuan. They can get back up to 90 bucks, hey. That's what it looks like.

That's, isn't it? Are these banks stupid? Or crazy?

The banks are not stupid, nor are they crazy, because this is the economic policy of Europe at that time, if the banks do not lend money to others and do not implement negative interest rates, then the European government will punish the banks, in fact, this is also a policy set by the European Central Bank, that is, the above decision-making is like this.

But is this for Mao? What are the consequences of this?

Consequence. We have already seen that there is a big problem in the European economy, but the reason for this is actually very simple.

The ECB is desperately printing money!

Yes, for one reason, printing money. Think about it, I printed a lot of money, but I printed money, and this money was lying in the bank. That can't create any value, right? Then it's very simple, you have to take out a loan, and only by using this money can you generate value.

So. Banks have negative interest rates, and their purpose is to lend out that money, which is a very, very simple reason. And it sounds like it's true, it's simple. Quite reasonable, but!

Shouldn't we think about it? Why print money?

It's been almost 20 years, and when we economists today look at that history, we all think it's funny, because it's funny.

Why is it funny?

First of all, what is money printed for?

Let's take a look first, who started this money printing first, is it Europe?

No, this is what the United States did at the beginning, in the economic crisis of 2008, well, it is still defined as a financial crisis, in order to deal with this crisis, it can be said that the Federal Reserve did not have any other tricks at that time, so they thought of the last way, printing money!

To put it mildly, it was called quantitative easing and QE at that time. At the beginning, the plan was that QE1 was 600 billion US dollars, but later, the economy has not worked, it just can't work, so it continued to print, and it was printed to 4 trillion US dollars, which seems to be ......

In fact, the economy is still not good, although in the third quarter of 2014 the United States said that it was a cow, you see, my GDP grew by 5% this quarter, but in the whole of 2014, it only grew by 2%, which is no different from the previous two years, it doesn't mean anything, that is, the economy is still very bad.

But we can't continue to print it, and if we continue to print it, the dollar will be worthless, and to put it deeply, the hegemonic position will be lost!

So, in fact, the stagnation of the dollar and self-replication is passive, there is no way, but despite this, as soon as the dollar printing stops, there is a problem in the whole world, that is, the dollar has to return to the United States.

This question, from the perspective of ordinary people, it seems that there is nothing, isn't it just to go back, then go back.

However, there is a liquidity problem here, that is, the dollar is the world's currency, and oil still needs dollars to settle, so when the dollar flows back to the United States, the world is faced with the problem of insufficient dollar liquidity, that is, there is no dollar, what can I do?

Is there anything difficult about this?

Because of what happened before, it was decided that this thing was difficult to do, what happened before?

Dollars are being printed, flooding all over the world, but this flood is not given casually, this flood will not find someone and stuff him with a pocket of dollars, this flood is a loan!

yes, who can take out a loan?

Big enterprises, big capitalists, big companies, right? They can't be ordinary people, because how can they be qualified to take out loans?

This loan is still very strong and a lot because this loan is cheap!

The Federal Reserve almost overwhelmed the bank interest rate at 1% and below, because it didn't make a move, which is why it printed money, so the interest rate on loans was also very low, 1%.

1% loan, or dollars, then capitalists, business owners, large companies in other countries, not impressed?

Buy, buy, buy!

Since 2008, commodity and real estate prices have grown very fast, let's talk about China, when did our real estate fly?

That's right, it's this time period, but there was the Olympics at that time, so we don't see it very clearly, but in fact, how did those land kings come about?

Isn't it just that big companies can get cheap dollar loans?

The situation at that time. is that there are earth kings almost every day, and new records are raised every month. Right?

Let's look at the 4 trillion at that time, how much was this 4 trillion? That's $600 billion!

Add this together, and you can understand why we need to make four trillion, just to deal with the impact of this dollar on us.

These loans came out and were completed, but if domestic companies wanted to invest in domestic industries, they had to be exchanged for RMB, that is, the government at that time could not stop large companies from taking loans. That's too tempting, no one can stop it, and there is no way to stop it, so what's the matter? Do you still want to stop foreign investment?

The US dollar loan is exchanged for RMB, which will inevitably lead to the appreciation of RMB, and it is easy to understand that money is a commodity.

Once the RMB appreciates, what will be the result?

Exports are finished, and they are no longer competitive. Then there was the large-scale layoff, and then what happened after that, what was unstable, what was this demonstration, that demonstration. Is it still far away?

So, print the money first, and let the money go. Maintain a stable exchange rate. So, we see. Back then, the Yankees kept accusing us of manipulating the exchange rate.

It's really a fucking thief shouting to catch a thief, you print money first. That's what makes this problem, and it turns out that we're wrong?

It's a beep dog!

This is not only our China doing this, but basically the emerging market countries at that time did this, because everyone couldn't bear the problems that followed, so they chose to allow it first, asset bubbles.

Of course it's a bubble, because it's all hot money.

So, what is the purpose of actively printing money?

Because the economy is not good, this is the printing of money, so it is very simple, Europe also prints money because the economy is not good, it's as simple as that!

Emerging market countries print money, that is passive, and those who take the initiative to open the money printing machine are definitely because their own economy is not working, otherwise they will not do this, the same is true of the United States, and the same is true of Europe.

That economy is not working, is it really effective to print money like this?

That's what's really funny, because printing money doesn't actually have any effect on the economy, all it can do is make your books look good, but it doesn't increase the real economy.

What is the economy?

At least there must be commodities, they have to circulate, and then they have to circulate and be consumed, so that a circle can be formed, but what is money?

Money is a voucher, money is a bill for buying and selling goods, that's all.

Money is not a general equivalent!

In other words, there is more money, but there is no increase in goods, and there is no real increase in spending power, so how can this economy get better?

And that's not all, why is the ECB forcing banks to lend?

In order to get their increased money to circulate into the market, they can't just lie down like that, but can they achieve the ultimate goal by forcing loans in this way? That is, to invigorate the economy?

Now there is more money, and there is no increase in goods, and there is no change in demand, but there is more money, and if you take the money and don't lend, and the top will punish you, then what will happen?

Remember the economic crisis of the 20th century, when farmers threw out milk?

Yes, this is the result, not only that the economy will not improve, but that even the capital will suffer!

So, after doing so for a few years, then Europe can't hold on, in fact, just before Japan, there is also this problem, because Japan is actually printing money on a large scale, Japan is actually printing money on a large scale, Japan is originally 0 interest rate, 0 interest rate for many years, and as a result, printing money, this is equivalent to negative interest rates, so the pattern of everyone falling down is actually about the same.

But this matter, printing money, seems to have started in the United States, so will they be fine?

"Wow!"

John and Maggie followed their mother to the mall to shop, and they passed by the TV area, and it turned out to be red, and the tiles were red!

In the story of the United States, red represents a decline, and yes, not long after the end of Europe, the American stock market has seen a huge decline! (To be continued......