Real Interest Rate turning Negative and its implications

What is a negative real interest rate? 
The real interest rate is the effective rate after adjusting for inflation and is considered a true measure of the cost of funds for the borrower or the return to the lender. It is calculated approximately by subtracting the rate of inflation from the nominal interest rate. When inflation is higher than the interest rate, the real interest rate becomes negative. If the one year interest rate is 8% and average inflation over this period is 10% then the real interest rate is negative 2%.