Better to hit the money later than today

Scientists used to think that people would rather spend money today than later. But that could change in an aging society. That would also explain the phenomenon of negative interest rates. Do economists have to rewrite their textbooks?

Saving so that you can let it rip in old age: Have people's preferences changed?

Et is an exciting question: Can the spread of negative interest rates in more and more areas of the economy also be interpreted as a sign that people’s time preferences have shifted? So that there are now people who prefer consumption tomorrow to consumption today, and that for this reason impatience has recently been rewarded with interest and no longer patience? Is there now a “negative time preference” – in line with the “negative interest rates”?

A current market report by the major bond investor Pimco thinks this is at least “likely” and relies on statements made by his economic advisor, the economist Joachim Fels. Pimco describes the ever-growing universe of bonds with negative returns and does not currently see even US government bonds as immune from slipping into the red. The bond investor does away with the traditional explanations. The central banks are not the main driving forces, rather the demographic development, which is making people save more for their age, and the technology, which makes less capital-intensive production methods possible for companies, have caused real interest rates to slide into the red.