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Unpublished Paper
How Low Interest Rates Impede Recovery
(2015)
Abstract
A super market and a bank in the money market treat their customers differently. A supermarket stands ready to sell to any customer any amount available of a commodity at a given price without regard to the customer’s credit standing. The credit standing of a potential borrower is paramount to a bank. Whether a bank offers a loan, its size if it does, and the interest rate it asks all depends on its assessment of the credit risk. Keeping interest rates low impedes lending and economic recovery.
Keywords
- Supply of Loans,
- Central Banking
Disciplines
Publication Date
May, 2015
Citation Information
Lester G Telser. "How Low Interest Rates Impede Recovery" (2015) Available at: http://works.bepress.com/lester_telser/58/