Posted on 11/04/2015 9:50:16 AM PST by SeekAndFind
p r o t e g e
I know what lowered or raised rates are. But what are “negative” rates?
Remember the 1980s and the Super-Saver CDs? Some places were paying 18-19% interest.
Should have refreshed the thread before asking this question. Oh well ...
Should have refreshed the thread before asking this question. Oh well ...
Anything's possible down the line. But as of now, your money is safe, whether it's in the local bank or with Charles Schwab. It's not tin-foil hat time there yet.
The problem is that any interest rate move will affect all invested money everywhere, in a Schwab account or not. So if the Fed rate goes negative, your Schwab money market rate will drop, maybe to 0%. I think that folks like Schwab will try to avoid going negative as long as possible, just for PR reasons.
On the other hand, a rate drop will make any long-term bonds you have with Schwab (or with anyone else) more valuable.
As for stocks, eh, who knows?
“Geez, I’d rather have Beaver running the country, hell, I’d take Eddie Haskill over this bunch.”
Bernie Madoff isn’t doing anything right now and is living at taxpayer expense. Let’s try Bernie, he will do better than Ben and Janet.
Right?
I’ve got retirement squarely in my sites, although a few years away...it’zza comin fast.
Stock market? I’m skeered
“Trump/Cruz 2016” - Cruz will be all for that. Trump will be a one-termer and ready to handoff to Cruz in 2020.
Believe it or not, some European banks already have negative rates, usually on large deposits only.
So if the interest rate is, say, 1%, the bank adds 1% to your account each year.
But if the interest rate is -1%, the bank SUBTRACTS 1% from your account each year. So not only are you getting no interst, you are losing money each year.
I think accounts for two things: (1) higher risk of default, and (2) market based interest rates for collateralized debts. Since more and more mortgages have become collateralized into mortgage bonds over time, they have to generate interest rates similar to other bonds in order to get investors to buy them.
Yellen ,”my only job is protecting Obama and try to make everything look hunky dory “
RE: What were Yellenâs qualifications again?
Previously, she was President and Chief Executive Officer of the Federal Reserve Bank of San Francisco;
Chair of the White House Council of Economic Advisers under President Bill Clinton;
Professor Emerita at the University of California, Berkeley, Haas School of Business.
Read the fine print, they can seize items in those safety deposit boxes. They seized gold in 1933 from safety deposit boxes. And storing lots of cash in the is usually a no-no.
If they are nutty enough to do this watch for bank runs. The feds and banks will essentially ban people from taking their own money out of the banks at some point and the war on cash will get worse.
If this happens the home safe business will boom and home invasions and break-ins will skyrocket. Also the number of criminals shot dead B&E will increase.
We already have negative rates...rates are lower than the stated and real inflation numbers.
Just goes to show that there can be a silver lining to every situation. :)
(Ok, you're right, that is more serious than funny...)
Back to putting it under the mattress or a box buried in the back yard.
Depends on whether your bank account is converted into a ownership share of the bank, then devalued in a bank reorganization per “Frank-Dodd”.
I did the home safe thing twenty years ago.
Keep stuff at the house that I don’t want big brother to grab.
There’s something I don’t understand >>
- The FED has been saying they want to move off ZIRP for months or years.
- Now Yellin is hinting/warning/threatening that they will go to a negative rate, I guess that would be minus ZIRP.
I, for one, am tired of being played for a fool for listening to their BS. What’s going on, do you think?
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