Sharp fall in US hiring raises questions about a June Fed rate hike

And that is the problem - you are being dragged about by each piece of financial information which is just increasing volatility without knowing it's true relevance.

For sure.

Having struck out with negative "real" interest rates, negative nominal rates are proposed and already enacted across large sections of the global financial system (including yields on "risk free" securities). At some unknown and really unknowable point, people and really more so banks will interview and become more open to alternatives which escape this authoritative repression.

This is wholly different than the "hoarding" vilified of the 1930's in both cash and gold. It represents the contradictory tensions that serve to illuminate the inconsistency of the dominant economic and monetary theory. To save the global economy, and the US with it, the central bank "must" tax short-term "money" rates so that banks will instead lend rather than hold to their own liquidity preferences (to reuse a Keynesian term more at home wholesale interbank than in the economy), and if they don't they will pass along those negative nominals to deposit holders so that they will spend rather than save.

It's reprehensible on so many levels, including the assignment from above about when and how people are supposed to engage in commerce. And if one might be so inclined as to exercise free authority to deny the command, then they are instead to be denied increasingly the means by which to escape the authority; the monetary noose can only tighten.

As I described last week, the only reason to hold a negative "yielding" money market balance, whether in the private money markets or on account at some central bank, is to remain in good standing of the virtual wholesale system. In other words, you accept -30 bps for now because at some point you expect to put that liability "to work" in some positive yielding opportunity in the near future. If you instead convert to cash, you will have both additional costs in doing so but then face the prospects of having to again convert back to virtual cash in money market accounts in order to carry out participation in any future opportunity; physical cash is illiquid. It might be too much hassle at -30 bps, but perhaps not at -50 bps? -100 bps?

That is the current danger facing global NIRP; there exists already quite negative nominal rates around the world and now the dimming prospects for those future opportunities. At some point, and it is impossible to determine the level that might trigger it all, banks will make the same determination that people were once free to make in the 1930's; getting the hell out because they can and because there is only increasingly more cost and risk and no upside to remaining under such repressive conditions. Read more