Negative Interest Rates? How’s that work?

Question

Negative Interest Rates? How’s that work?

In: Economics

Answer 1

You take out a loan for $100, and wind up paying only $90 back (or… whatever the amount is), instead of regular loans with normal interest rates where you take out $100 and pay back $110.

It’s a way to stimulate / encourage people to go and purchase things in a market that’s becoming not popular (not houses, for instance).