Negative Returns on Corporate Bonds: How the ECB Renders the Interest Rate Steering Function of the Capital Market Ineffective

Dirk Meyer ()
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Dirk Meyer: Helmut-Schmidt-Universität

Chapter Chapter 6 in European Union and Monetary Union in Permanent Crisis I, 2022, pp 97-110 from Springer

Abstract: Abstract Since June 2016, the European Central Bank (ECB) has also been buying corporate bonds. Negative interest rates on corporate bonds as a result of this expansion of the ECB’s purchase program undermine the economic steering function of the capital market. Despite a negative marginal productivity of capital, investments are economically viable.

Date: 2022
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Persistent link: https://EconPapers.repec.org/RePEc:spr:sprchp:978-3-658-38643-6_6

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DOI: 10.1007/978-3-658-38643-6_6

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