In an article for Barron’s last month, Grant’s Interest Rate Observer founder and editor James Grant offers insights regarding the repercussions of an ultra-low interest rate environment.

Grant quips, “You can as easily imagine a five-pawed St. Bernard or a suitable candidate for public office as you can the situation of a lender paying a borrower for the privilege of extending a loan.” He points out that such an interest rate environment means that saving money requires more principal to compensate for less interest and, on the flip side, “at minus 2%, your principal would be chopped in half in approximately 32 years.”

The article outlines various examples of how ultra-low borrowing costs have manifested in corporate debt both here and abroad, adding that regulators have taken notice and “now fret that their corporate charges are helping themselves to more free credit than is good for them.” Grant argues, however, that central bankers should keep in mind: “interest rates are prices, not policy levers. And as prices, they set investment hurdle rates and measure credit risk.”

Failing to find a way back to “normalcy,” Grant explains that central bankers are “casting around for new ways to control what they seem unable to understand.”