Posted on 05/11/2023 3:26:59 AM PDT by EBH
These banks pay little or no interest on deposits. Why? They have more money than they can lend to creditworthy customers, so they don’t need the deposits they have.
Naturally, large companies have to keep their money somewhere. But if they don’t need their money immediately, they can do something like buy 3 month T-bills at 5%. Corporate treasurers know how to manage cash, so this is exactly what they’re doing. This is why shorter term interest rates have come down.
I dropped big banks a long time ago. Their service is awful with a bunch of arcane rules dreamed up by some wet behind the ears Harvard graduate.
With the small banks I deal with I can walk in and deal directly with the guy running the thing like a normal person. And what they do makes sense.
An investment advisor is telling people to pull their cash from the banks. Just wow. We’re probably going to see the banking system in crisis shortly.
The government is promoting a big lie that the banking system is safe, when in fact, it’s imploding. WHEN will people who have been supporting this government turn on it? When???
if you (or a friend)have a stock brokerage account ask your broker what brokered CD’s are available..Wells Fargo, Morgan Stanley and Goldman Sachs as well as many others have CD’s available through brokers that are not advertised...some are one year or 18 months and just over 5%.....
brokered cd’s:
https://www.investopedia.com/terms/b/brokered-cd.asp
Joe’s amazing economy!
Truncated charts can be very misleading—they rated a specific discussion in this book:
https://www.amazon.com/How-Lie-Statistics-Darrell-Huff/dp/0393310728
My main bank was interesting. They had 4% savings, but only if you lived in an area without branches, so I couldn't get it.
The most recent auction of 4 week T-bills was 5.89% on 5/9/23.
As of yesterday I own 26 week T-bills. 17 week t-bills and now 4 week t-bills. All of that money came out of my bank account where I was earning virtually nothing.
Today there are on line savings accounts that pay good interest rates. That is an easy alternative to any bank savings account that pays squat.
Consumers are beginning to figure it out...T bills, money market funds, high interest savings...lots of choices.
if you live in high tax state like california or new york, treasuries are exempt from state and local taxes and there are calculators available on line to compute the after tax return depending onyour state, income etc. they get me about .5 % more net than a cd after tax.
NH , but we do have an interest and dividends tax.
It is the only form of state income tax we have.
https://www.zerohedge.com/markets/futures-slide-bank-selloff-returns-pacwest-tumble
“US equity futures pared an earlier advance and dropped to session lows driven by a fresh plunge in Pacwest shares after the bank warned the bank run was back (or rather, had never gone away as we warned last weekend) as a renewed sharp deposit outflow from the bank spooked investors, even as European stocks rose as more investors said the Fed is likely to pause interest-rate hikes on the back of cooling inflation data. Contracts on the S&P 500 dropped to session lows, down -0.1% after rising 0.2% earlier; the Nasdaq was flat.”
A week or so ago, the markets all heaved a big sigh of relief as “experts” said the banking sector crisis was largely over. I said at the time that such was not true as deposits at banks are still down and many regional banks are still at risk. The reporting today shows I was correct.
Why do you think you are seeing advertisements begging for new accounts as they promise you a thousand dollars for opening an account with a $20,000 deposit? The banks NEED those deposits.
No wonder gold has been on the up tick.
Thank u
Thanks.
BKMK
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.