The Attack on Thrift

Norges Bank, the central bank in Norway, today elected to keep the key policy rate unchanged at 1.5%. Keeping the policy rate low is in line with most central bank policies in the western world and Japan. Instead of encouraging good old fashioned bank savings which are funds banks can lend to entrepreneurs for investment purposes, such policies only serve to induce ever more debt accumulation and capital consumption. Thrift loses, spending beyond means wins. In the end, all lose.

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