Olivier Blanchard: Helicopter Money 'Largely a Scam'

The video discusses the implications of negative interest rates on economies like Switzerland, Germany, and the UK, highlighting their effects on bank profits and credit availability. It explores market reactions, investment strategies, and the role of Treasurys in diversification. The concept of helicopter money and its relation to fiscal deficits is also examined, with a critical view on its effectiveness.

What is one potential negative effect of chronic negative interest rates on banks?

• Increased bank profits

• Higher mortgage rates

• Increased demand for loans

• Reduced bank profitability

Why is there a high demand for yield in the global financial market?

• Interest rates are expected to rise

• Central banks are buying positive yielding assets

• Central banks are reducing interest rates

• There is an abundance of high-yield assets

What role do Treasurys play in a portfolio according to the speaker?

• They are the primary source of income

• They provide high returns

• They act as a hedge against market risks

• They are not recommended for investment

What is the speaker's view on helicopter money?

• It is a magical solution to economic problems

• It is a scam and not effective

• It is the same as increasing taxes

• It should be implemented immediately

According to the speaker, what is the key factor in the discussion of helicopter money?

• The amount of money printed

• The interest rate on bonds

• The size of the fiscal deficit

• The method of financing