Wednesday, February 22, 2017

Using government as a substitute bank

when your central banker gets stuck.
Mish: Data released on Wednesday showed Sweden’s government generated a budget surplus of SKr85bn ($9.5bn) in 2016, with approximately SKr40bn coming from tax overpayments. The government will have to repay more than £3.5bn to businesses and individuals who purposely paid too much tax in 2016.

Sweden's not on the euro, and its currency was in high demand by european savers, They had the Swiss problem.

They made rates negative to discourage foreign krona savers. The better solution was to issue a krona account to all demanders and run a S&L on their behalf.  If savers demand your currency then make it available at your price.

All of  these central bank issues will resolve in the sandbox.

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