Dr. Martin Hash Podcast

A modern economy requires people to spend money; in fact, in a flagging economy, saving money is actually a bad thing and borrowing money is a good thing. The way The Fed encourages borrowing is to lower interest rates, so far to the point where there is almost no incentive to keep money in a bank except for the convenience. In times of dire economic slowdown, where the goal is to get people to borrow money but interest rates are already zero, it's obvious negative interest rates are next, meaning money in the bank is decreasing in value; this actively encourages people to spend their money. This is already happening in the Euro zone banks.

Saving money for a rainy day is a conscientious axiom; everybody believes it though the majority of Americans don't do it. Saving money for retirement is even more ingrained in the American economic psyche. Negative interest rates will certainly cause anguish & turmoil similar to rising inflation because they are essentially the same thing, and incentivize the same thing: spend now. Young people typically don't have much retirement, nor savings of any kind, so negative interest rates that encourages lenders to lend more at lower interest rates benefits them. Young people are typical the producers, and people with savings are typically not, so if the goal is to encourage production, negative interest rates do that too.