NIRP as a Wealth Confiscation Tax

     Negative interest rate policy (NIRP) has befuddled us all for far too long, so your MacDougal Post staff sat down in extended session and came to grips with this goofiness once and for all.  If you and I have to pay the Federal Government relatively modest sums of money each year for the privilege of loaning failed politicians towering piles of our capital because they disdain functioning within a budget, then one thing it clearly isn't, and that's interest.

     Therefore, there is no such thing as negative interest.  It does not exist in the real world that we, and our valued subscribers, live in.  Given that, then the obvious should hit you the way it did us.  Like a ton of bricks.

    NIRP is another g%dd&m tax.  Like the $&@#!%& income tax or the $&@#!%& capital gains tax, or the $&@#!%& tax they're collecting on our social security income now, it's a Federal $&@#!%& tax.  Only, unlike the rest, NIRP is the nuclear option of revenue collection, a WEALTH CONFISCATION TAX.

     Zero interest rate policy (ZIRP) pays investors miniscule, below-free-market rates on Treasury securities, but at least it's something.  Under NIRP, look what happens if you take this confiscatory obscenity to a logical extreme: a 20% negative interest rate on T-bonds, discounted, meaning payable in advance.

    The first day you sink one million dollars into one of their g%dd&m NIRP bonds, you give them $1 million and they take 20%, or $200 thou, out of your balance as negative interest, leaving you with $800 thousand.  On day one of the second year, they take another 20% the same way, or $160 thou this time, leaving $640 thousand.  In one year and one day, the Feds have helped themselves to $360 thousand of your rapidly disappearing bankroll.

     We've seen 20% free-market interest rates on T-bonds in our lifetime. Is anyone cockamamie enough to believe the Central Party won't come up with 20% negative rigged interest rates if the profligates need it to cover over-the-top spending?  And if the $#%!&^#$ only take 2% instead of 20%, that's still wealth confiscation even though "only" $20,000 revenue goes to them that first year, and how are you supposed to &%$#@!$ live on a declining capital balance anyway?



ZIRP-A-Dee-Doo-Dah,
NIRP-A-Dee-A.

My, oh my, what a pitiful day,
Plenty of sorrow heading my way,
ZIRP-A-Dee-Doo-Dah
NIRP-A-Dee-A.

Mister Taxman's on my shoulder,
It's the truth,
It's a worry,
Everything's confiscatory.

ZIRP-A-Dee-Doo-Dah,
NIRP-A-Dee-A,
Sorrowful feeling,
Sorrowful day.

Yeah.

ZIRP-A-Dee-Doo-Dah,
NIRP-A-Dee-A.