Should real interest rates be even lower in the long run?
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One of the key drivers of returns on financial markets are real interest rates. Most investors look at nominal interest rates as a guide to what they can earn by investing in money market funds or bonds. But really, what matters are real interest rates after inflation is taken into account. And as most interested investors know, the problem with real interest rates is that they have been negative in many developed countries for several years. This in turn means that by investing in inflation-linked bonds or nominal bonds you have to expect to lose money after inflation.
Should real interest rates be even lower in the long run?
Should real interest rates be even lower in…
Should real interest rates be even lower in the long run?
One of the key drivers of returns on financial markets are real interest rates. Most investors look at nominal interest rates as a guide to what they can earn by investing in money market funds or bonds. But really, what matters are real interest rates after inflation is taken into account. And as most interested investors know, the problem with real interest rates is that they have been negative in many developed countries for several years. This in turn means that by investing in inflation-linked bonds or nominal bonds you have to expect to lose money after inflation.