have _real_ interest rates really gone negative? Deflation boosts real interest rates.
Jim Devine [EMAIL PROTECTED] & http://bellarmine.lmu.edu/~jdevine > -----Original Message----- > From: Sabri Oncu [mailto:[EMAIL PROTECTED]] > Sent: Saturday, May 11, 2002 1:31 PM > To: PEN-L > Subject: [PEN-L:25893] Re: RE: Re: P.S. > > > http://www.jei.org/Archive/JEIR98/9843w2.html > > Jim and Micheal, > > Take a look at the above as an example. A google search with: > > Japan "negative interest rate" > > brings a ton of information. I know it because of my favorite > inetrest rate model: the Vasicek model. Oldrick (Vasicek) is a > friend and this is mainly why I like it so much. Well, just > kidding, this is of course the secondary reason: it is an easy > model to implement, this is the real reason. People did not like > his model because it implied that interest rates can go negative. > When Japanese rates went negative, people started to like his > model again. > > Best, > > Sabri > >
