Post by Pakachoag Phreek on Aug 14, 2019 15:27:38 GMT -5
Banks in Europe have started lending money for mortgages which carry a negative interest rate. In effect, the bank is paying you to borrow.
This is not good economically, in fact, its pretty terrible. (It reflects an expectation (fear) that certain assets, including some classes of financial assets, will depreciate in value. But for the borrower, great news!)
However, if negative interest rate lending takes hold in the U.S., perhaps HC can re-finance some/much/most/all of its debt If it could, that would reduce the $6+ million HC paid in interest on its outstanding debt in 2018.
Post by longsuffering on Aug 15, 2019 16:41:51 GMT -5
Refinance till the cows come home. Every dollar saved in interest is a dollar for all the other worthy initiatives HC undertakes.
I did have a funny reaction to European Banks paying people to borrow, when I wondered if employees have to pay to work at the bank.
I assume this unusual policy makes sense if the bank loses less money lending than they would by buying negative interest rate European Government Bonds and they can generate cash flow from origination and servicing fees on the loans.
Post by longsuffering on Aug 16, 2019 11:45:31 GMT -5
I am a jumbo dumbo, but yes I think they have slow economic growth, an aging population, costly social safety nets, a generosity of spirit that has them taking in more refugees than the US and way more than the number two and three economies China and Japan do, strong labor unions and high minded but costly EU regulations to name a few reasons why the quality of life is good in Europe but the economy is slowing.