Fiat Money ‘Not Worth Anything Anymore’ Admits Banking Giant CEO (Bitcoinerx)

Oswald Gruebel, the ex-CEO of Credit Suisse, criticized negative interest rates and said that money is not worth anything anymore. 

In a recent interview with the Swiss newspaper NZZ a, Sonntag, Mr. Gruebel explained that negative interest rates are having an adverse effect on fiat currencies. 

“Negative interest rates are crazy,” he said, adding “That means money is not worth anything anymore.”

Gruebel stated that as long as interest rates remain in place, the financial industry as a whole will continue to shrink. 

Between 2004 and 2007, Gruebel was the CEO of Credit Suisse. From 2009 to 2011 he served as UBS Group AG’s executive. 

Nowadays, Credit Suisse is planning to impose charges on wealthy clients due to the negative effect interest rates are having on the financial institution. 

HSBC is also planning to cut 10,000 more jobs worldwide considering the bank expects further rate cuts in the United States and low-interest rates in Europe for an extended period. 

At the same time, during this interview, Gruebel said that Switzerland’s position as a banking hub has been affected by different scandals in which Credit Suisse was involved.

This includes a spying case in which the bank hired private detectives to trail the former head of wealth management Iqbal Jhan as we decided to defect to UBS. 

“Foreign media are bursting with glee,” he mentioned. “In a business that above all requires expertise, there’s nothing worse than to look ridiculous.”

However, Switzerland is becoming a cryptocurrency and blockchain hub as well. 

The city of Zug is already known as the Blockchain valley where several companies have already located their offices to offer services to their clients. 

Moreover, the country has also created clearer regulations for firms to operate in the blockchain and crypto markets. 

Fiat money losing value around the world

Gruebel’s comments echo what financial experts around the world are starting to realize – that fiat currencies are losing their value.

Central banks around the world are currently in a race to lower interest rates, making currencies less valuable. 

Moreover, they are discouraging individuals from saving and pushing them to spend more.

Last month, the European Central Bank (ECB) decided to cut interest rates to -0.5% and Marilyn Watson, global fundamental bond product strategy team head at Black Rock, explained that there is potential for interest rates to go more negative, especially in Europe and in Japan. 

Meanwhile, other countries such as Venezuela or Argentina are registering very high inflation rates. While Venezuela is currently in a hyperinflationary spiral, Argentina could shortly follow Venezuela’s steps. 

Populist governments are printing money trying to convince their populations that owning more coloured papers would make them wealthier. 

Despite the lower interest rates, growth is falling all around the world. The International Monetary Fund (IMF) has cut global growth forecasts for 2019 and 2020. 

Without a healthy financial market, with countries with high inflation rates and with unresponsible monetary policies, the trust in fiat currencies is falling. 

Other issues such as trade wars, Brexit or protests in Hong Kong or Ecuador are becoming a real threat to economic growth in specific countries and regions as well. 

This is where gold and Bitcoin (BTC) could eventually become important for society. 

Image courtesy of ShutterStock

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