tag:blogger.com,1999:blog-2938311055760665357.post8247410646393511825..comments2024-03-27T03:49:12.592-07:00Comments on Ed Dolan's Econ Blog: Consumer and Producer Surplus: A Slideshow-TutorialEd Dolanhttp://www.blogger.com/profile/08757995049056872214noreply@blogger.comBlogger2125tag:blogger.com,1999:blog-2938311055760665357.post-14588962649228721892015-01-25T08:10:26.835-08:002015-01-25T08:10:26.835-08:00I'm not sure exactly who is buying the Swiss b...I'm not sure exactly who is buying the Swiss bonds, but I can imagine at least two motives for buying them at negative nominal yields. One is that if the rate of deflation is faster than the negative nominal yield on the bond, then the real yield is positive. The other reason is that they expect the Swiss franc to continue to appreciate vs. their home currency at a rate that is faster than the negative nominal rate on the bonds.Ed Dolanhttps://www.blogger.com/profile/08757995049056872214noreply@blogger.comtag:blogger.com,1999:blog-2938311055760665357.post-60946945808542857682015-01-25T06:45:18.960-08:002015-01-25T06:45:18.960-08:00My take away from your excellent presentation: The...My take away from your excellent presentation: The big fear is that the controllers of currency have no idea what to do when deflation takes hold. Their main tool - interest rate manipulation - is off the table. Their other tools - QE et al - are experimental and likely to have unanticipated consequences.<br /><br />One question. If interest rates rise as deflation increases, why are people buying Swiss bonds at negative interest rates today?Tom Dolanhttp://glasslined.usnoreply@blogger.com