Second order effects of negative interest rates

[timelets]

- If interest rates for small savers ever were to go negative, it would give rise to the juxtaposition of income penalties for households with benefits for “the elites” through their ability to profit from rising equity prices. Economic impact aside, the boost to populist politics would likely be dramatic.

- Negative rates on U.S. Treasurys would, for example, harm the Social Security Fund (which can only invest in Treasurys), hastening the day when it runs out of money.

- Financial models and algorithms – which essentially are a matter of looking for and profiting from deviations from historic relationships – may not work as well as they did in the past, since history (all of which has been based on positive interest rates) may be out the window.

https://www.oaktreecapital.com/docs/default-source/memos/mysterious.pdf

somewhat related https://www.coindesk.com/3-ways-staking-will-upend-the-economics-of-ethereum