Negative real rates have been normalized in the fiat era, but that's possible because fractionally reserved banking means credit creation has zero opportunity cost. So there's no floor on rates, because any nominally positive rate is profitable to a lender who has infinite free credit creation potential.
I'm increasingly convinced that all the distortions of the current monetary system stem from fractionally reserved banking and zero opportunity cost credit creation. It's warped everyone's perception to the point that we can barely understand how a different system would function, because we've lost sight of what money really is and how it works.
I've been playing with the idea that sound money is more like equity, rather than like the credit we use as money today. I think raising capital in a deflationary currency system will be structured with a lot more equity and a lot less debt. Once a deflationary currency has fully monetized, equity will outperform just holding currency as long as the business makes a profit in nominal terms. And that would be the definition of a business that's adding value to the economy. If it can't do that, it's just destroying capital and the equity rightfully should fall to zero.
https://open.substack.com/pub/f0xr/p/money-as-equity?r=3i492j&utm_campaign=post&utm_medium=web