I interpreted the
as allowing for some wiggle room between spot and market. If it is 0%, you should have a tighter correlation. Although lots of people are saying "oh boy, we get
!" I don't think they realize it is meaningless since assets will be priced taking that
into account, so in reality they will get some market interest rate (bit assets will be priced assuming a 5% growth). It's like buying a one year 5% coupon bond at a 4% premium, you're really getting something like 1%, even though it says
.
Well, I guess what I'm saying is it almost doesn't matter what % you choose, the market in the long run will correct itself (if
is too high, asset value decreases over time, if it is too low, asset value increases over time). The bigger the %, the less correlated to spot in the short term. The bigger the %, the more people "feel" like it is a bank.