As central bankers struggle to help their economies deal with what seems to be a period of stagnating growth and inflating asset bubbles, economist Kenneth Rogoff argues that a key tool is missing from their kit: rates well below zero. His thought-provoking new book The Curse of Cash demonstrates a close connection between negative rates as an effective policy and the phasing-out of high denomination paper currency. In the interview below, he lays out his views on why negative rates are inevitable, what needs to be done to prepare the ground for them, and where gold fits into the current monetary world.
our thoughts on why — and why now — we should get rid of large bills, as you advocate in your new book The Curse of Cash?
Kennth Rogoff is the Thomas D. Cabot Professor at Harvard University and the author of, most recently, The Curse of Cash.