We were lulled into a false sense of security. The first years of this century and the last of the previous one were, he reminds us, a time of wealth and spending. It is at times of greatest prosperity that we should worry most. “Much of the financial history of the past 150 years is the story of unsuccessful attempts to maintain the value of money.” The banking system has, he contends, always been the weakest link in the economic chain. King delves into history in his quest for answers, from hunters’ arrows to the earliest banknotes (China in the seventh century AD). Central banks are paralysed, fearful of doing anything that might presage another panic. It was, he points out with consistency of argument, not meant to be this way. Photograph: The Asahi Shimbun/The Asahi Shimbun via Getty ImagĪn entire generation has now become used to negligible or negative interest rates. Less than zero: a commuter passes an electric display as the Japanese government’s 10-year bond turns negative for the first time last month.
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