ipl-logo

Essay On Negative Interest Rate Policy

710 Words3 Pages

No, the new monetary policy which is negative interest rate did not project positive outcomes. There are few reasons why Negative Interest Rate Policy (NIRP) is ineffective in Japan.

The major reason that Japan cannot achieve positive outcomes like europe is due to the aging population in Japan. For instance, Japan is experiencing ‘super aging’ society, not just in rural area but also in urban area. When Japan adopted Negative Interest Rate Policy (NIRP), this causes too much of money flow into the market and this will indirectly increase the price level of goods and services. Therefore, real income will eventually decrease as the price level of goods and services increase. For example, the retired people who lived based on pension fund will begin to save their money and spent less on consumption. Hence, when the government introduced NIRP, most people started to stash their money under the mattress and in safe. This causes a phenomena which the sales of safes in market doubled up. The government of Japan adopts NIRP is to increase the velocity of cash and to stimulate the economic growth, but instead of bringing benefits to the economy, it actually brought unexpected negative outcomes to Japan.

In addition, the uncooperative firms in Japan is one of the reasons why the new policy failed to achieve positive outcomes. Negative interest rate policy is to encourage banks to lend their money to household and business to put it to more productive …show more content…

Japan implemented Negative Interest Rate Policy (NIRP) is to solve economic problems like inflation. Although Negative Interest Rate Policy (NIRP) was soon implemented, the inflation problem was not solve properly . At that time, global economies are very poor, global export rate are slumping and global currency are not stable. Currency of USD depreciate and bring negative effect to

Show More
Related

  • 18th Century Dbq Analysis

    447 Words  | 2 Pages

    The first positive was that every American can afford more luxuries. This is because, as Andrew Carnegie in Document 1 put it, “Today the world obtains goods of excellent quality at prices which even the last generation would have thought unbelievable.” The effect of this was that poor people

    Read More

  • Franklin D. Roosevelt: Benefits Of The New Deal

    834 Words  | 4 Pages

    This was one of the biggest reasons FDR was voted into office in hopes that he could help not only the country, but capitalism itself recover. There were many good things about the New Deal. During this time of year it solved many of the problems in America. It also helped many of the unemployed find work. Thousands upon millions of people were relieved.

    Read More

  • The Progressivism Movement: Taft, Roosevelt, And Woodrow Wilson

    607 Words  | 3 Pages

    The Federal Trade Act also ended many illegal practices businesses were taking advantage of. Also, creation of the Federal Reserve System helped the lower the inflation issue taking

    Read More

  • Pearl Harbor Economic Analysis

    1033 Words  | 5 Pages

    In 1928, The Kellogg-Briand Pact was signed and then many other reforms came into place. These countries involved in these many acts were Britain, Japan, Italy, and Germany. The U.S wanted to stay neutral during the war but couldn’t after Japan attacked Pearl harbor. But we are here to discuss the events leading up to Pearl Harbor. So, The events leading up to Pearl Harbor affected the economy positively.

    Read More

  • Desolation In The Great Depression

    1581 Words  | 7 Pages

    Although this may seem negative, it actually improved the economy through the devaluation of US dollar, which in turn made US exports more cheaper and thus more popular. (Klein) Besides that, the New Deal also created many governmental programs that are still in use today, such as welfare and the Federal Housing Administration. The New Deal was a benefit to the people, as it focused on improving the quality of life and creating jobs. FDR is not the only person to be an advocate for the termination of desolation.

    Read More

  • Andrew Jackson's Economic Policy

    782 Words  | 4 Pages

    Andrew Jackson was brought up through humble beginnings and hardships throughout his lifetime, starting out as the son of poor Irish immigrants to becoming the seventh president of the United States in 1828. Andrew Jackson supported the run-of-the-mill man, drawing his support away from the policies and treaties that supported the wealthy. Jackson did everything in his power to revolutionize the “common man” and give them the most support. Jackson’s policies were criticized throughout the nation, earning him a very questionable spot in history. While some may argue that Andrew Jackson supported the “common man” and tried to do what was best for the majority of the nation, his economic policies and his treatment towards the Native Americans

    Read More

  • New Deal Dbq

    1874 Words  | 8 Pages

    Many of the policies introduced were useful like the benefit scheme implemented by the Social Security Act. Benefits were introduced in the US because of the New Deal and still exist today, displaying how parts of the New Deal were helpful. However, the main reason it was not a turning point is due to the New Deal did not providing long-term prosperity. In fact, WW2 was the primary reason for prosperity. From 1942-1945, unemployment rates never rose above 5%, but after the New Deal started, unemployment rates were never below 15% (1933-1939)29.

    Read More

  • New Deal Dbq Essay

    564 Words  | 3 Pages

    The wealth during the 1920s left Americans unprepared for the economic depression they would face in the 1930s. The Great Depression occurred because of overproduction by farmers and factories, consumption of goods decreased, uneven distribution of wealth, and overexpansion of credit. Hoover was president when the depression first began, and he maintained the government’s laissez-faire attitude in the economy. However, after the election of FDR in 1932, his many alphabet soup programs in his first one hundred days in office addressed the nation’s need for change.

    Read More

  • What Caused The Great Depression Research Paper

    780 Words  | 4 Pages

    In the early 1930s the labor force in countries that were industrialized saw as much as one forth of its workers unable to find work. Conditions were starting to improve by the mid 1930s, however total recovery did not happen until the end of that decade. This was a very difficult time in United States history and around the world, but it could be said that something good came out of it, central banks throughout the world now try to thwart or moderate recessions. It is unclear whether a change like this would have occurred if not for the

    Read More

  • Essay On The New Deal

    813 Words  | 4 Pages

    During the Great Depression many people lived in poverty, more than 20% of the people were unemployed, but President Roosevelt implemented programs to help Americans prosper. The Great Depression is when the America’s economy had fallen to its lowest point. Many people lost their money and it’s when poverty hit rock bottom. The New Deal was necessary because even though it didn 't end the Great Depression it helped lowered unemployment, secure their money, and helped the economy prosper. In its attempt to end the Great Depression, the New Deal had many successes and failures    

    Read More

  • Japanese Tourism Impact

    833 Words  | 4 Pages

    Tourism has become one of the important economic factor for any nation today. With the increase in technology, the world is gradually changing and becoming closer and smaller day by day. The country known for its advanced technology, Japan is popular in terms of travel, commerce, technology, cuisine, popular culture and shopping. Globalization has played a vital role in interchanging activities such as goods, services, technology, culture, and even the lifestyle of people around the world. Japan’s tourism has grown rapidly in the recent years.

    Read More

  • Negative Liberty And Negative Freedom Essay

    931 Words  | 4 Pages

    Berlin first explicitly defined the ideas of negative and positive freedom. In negative sense Berlin states “What is the area within which the subject - a person or group of persons - is or should be left to do what he is able to do or be, without interference by other persons” . 'Negative freedom is the freedom from interference from others; it is the benefit of being alone and not impeded. The range of negative liberty is larger if the non-interference is larger. Berlin states that law ought to restrict the negative liberty in order to enjoy it at minimum.

    Read More

  • Japan Informative Speech

    743 Words  | 3 Pages

    Introduction Goodmorning, I am Timothy Hui and I am here to tell you what not to do in Japan. Japan is located in Asia, east of China. The population of Japan is 127 million people which are around 5 times larger than the population of Australia. Japan has the lowest obesity rate in the world. Last year, Tokyo was the 13th most visited city in the world.

    Read More

  • Pestle Analysis Of Maybank Malaysia

    709 Words  | 3 Pages

    Example, Malaysia is a country with growing economy and general rules which effect Maybank would be interest rates. It would be difficult for the loaners to pay back the money if the interest rates is set too high. Then, most of Malaysian people bankrupt due to paying loans with high interest. This will not benefit Maybank because the money has been loaned out has not return in. So, Maybank is now giving out loans to boost the export activity for exporting activity.

    Read More

  • Saving Money Essay: How To Save Your Money

    1029 Words  | 5 Pages

    “How am I going to save my money if I can’t go a month without being short on cash?” Is this the question you ask yourself every now and then? Why is saving money that much difficult for you? Saving money needs a hell lot of self-control and self-control is challenging. Not only that, saving is a habit and habits take time and effort to form.

    Read More

More about Essay On Negative Interest Rate Policy

Open Document