Ex-BOE’s King Warns of Cash Under the Mattress Scenario

The video discusses the limitations of negative interest rates, particularly in Europe, where they pose challenges for commercial banks and society. It highlights the potential negative impact on retail customers, who may withdraw cash if banks pass on negative rates. The video questions the reliance on monetary policy to address economic weaknesses, suggesting that other policy tools and resource reallocation are needed for effective solutions.

What are the implications of negative interest rates on commercial banking?

Why might customers prefer to keep cash at home rather than in a bank during negative interest rates?

What does the speaker suggest about the effectiveness of monetary policy in addressing economic weaknesses?

How does the speaker characterize the relationship between monetary policy and economic growth over the past decade?

What alternative policy issues does the speaker believe should be considered beyond monetary policy?