Government bonds are usually a safe place for people to park their money in times of economic uncertainty. But how uncertain must times be if German investors are buying up government bonds for almost no returns? That's what happened this past week - the return on the 10-year "German Bund" fell below zero for the first time ever, meaning people are effectively paying the German government for the privilege of holding their money.
It is politics. It is a gross political failure on the part of European leaders and of the European Union.
This is something that hasn't been seen before and seems to indicate that Europe's economic problems are not going away. Low interest rates in combination with the new bond purchase phenomenon points to the issues becoming even worse, yet again.
Former Greek Finance Minister Yanis Varoufakis claims that Europe has failed in responding rationally to the initial crisis, and has actually placed itself in a further downward-facing trajectory.
With EU investment rates at an historic low and saving rates at an historic high, interest rates will continue to plummet unless Europe is able to mobilise investments, says Varoufakis.
Varoufakis also pinpoints the dangers Europe's deflating economy poses to the world economy, including China, the US, and emerging markets.
But with political egos clashing and attempts to lay plans for future growth becoming secondary to government restructuring, will Europe seek improvement and change before it's too late?
Also on this episode of Counting the Cost:
Saudi Arabia into the future: With only eight months left of President Barack Obama's tenure in the Oval Office and Saudi Arabia's displeasure with the current US administration very publicly known, what were Saudi officials aiming to achieve in their most recent visit to Washington? We take a look at Saudi Vision 2030 - the plan to diversify Saudi Arabia away from oil. As the oil price recovers, will Saudi Arabia stick to the plan of privatisation and creating employment outside of the public sector? And, more importantly, will the US continue to be an economic and political ally throughout?
Russia out in the cold: President of the European Commission Jean-Claude Juncker caused a lot of controversy this week as he sat centre-stage with the UN Secretary-General Ban Ki-moon at the St Petersburg International Economic Forum. Russia remains under international sanctions after the annexation of Crimea - but hundreds of businessmen flew in to do one thing: make deals.
China and Mexico's amber alert: The Chinese thirst for luxury goods, and in particular the precious stone amber, has set the Mexican state of Chiapas alight. Miners in Simojovel, a municipality of Chiapas - Mexico's poorest state - dig in ungoverned caves, without any safety measures to protect them. But as Chinese interest rises, middle men and due violence interrupt the workflow from miner to buyer, making labourers the least likely to benefit from the resources in their own land.
Source: Al Jazeera