Druckenmiller on the Zero Interest Rates - Zerohedge

Druckenmiller: If you took the taylor rule a normal interest rate given our economic circumstances would be 4% interestingly. We’re at 1%. In europe, it would be 2%. They’re at minus 40%. In sweden, it would be 3.75%. They’re at minus 50%. That doesn’t even count the bond buying we’re talking. But this is all in the name of this 2% inflation target.

Evans: if they’re keeping rates in this country, you know, barely above zero, in other countries, below zero, what are the consequences of all of this?

Druckenmiller: well the consequences are huge because we’ve distorted market signals and we’re causing all sorts of what i would call misallocation of resources.

Evans: Like bitcoin? or is that unrelated?

Druckenmiller: No, it’s not unrelated at all. Bitcoin, art, wine, equities, credit, you name it. everything is one way up and there are huge distortions taking place, and it’s all in the name of this 2% inflation target. And when you get a misallocation of resources, it really hinders growth over the longer term.

Source: Druckenmiller: "I've Had A Terrible Year... It’s Going To Be My First Down Year In Currencies Ever"