The lower rates make otherwise marginal investment schemes look good, and otherwise marginal existing capital (having marginal returns) look suddenly profitable, resulting in a scramble to own it and resulting in persistent market maladjustments. The system becomes starved of capital for roundabout production, as capital is trapped in the present—consuming itself, as it were—and thus there are insufficient resources to support the ongoing illusion of economic progress.
Distorting loop of artificially low rates
