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More Savings Account Rate Cuts - E*TRADE, EmigrantDirect and Others

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Update: OneUnited just slashed the rate this Friday afternoon on its online savings account from 4.60% to 4.00% APY.

Online banks continue to cut their savings account rates. The cut at E*TRADE Bank was the most disappointing. The rate on their Complete Savings account fell from 4.10% APY to 3.45%. E*TRADE had kept this rate near the top since November 2007 when reports of their subprime problems came out. As I reported last month, E*TRADE's financial health seems to be improving, so perhaps they don't feel the need to offer the highest rates.

Below is the list of the latest cuts. With another expected Fed rate cut on the 18th, I'm afraid we'll likely see more.

E*TRADE Bank is still offering a $25 bonus for opening a Complete Savings Account. With the big rate drop, the account isn't as attractive now, but it remains competitive with some nice features. For more info about this bonus, please refer to this post.
  Tags: OneUnited Bank, E*TRADE Bank, savings account

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Comments
35 comments.
Comment #1 by Anonymous posted on
Anonymous
T Feds are killing the interest rates by pumping cheap money into the financial system.

Read this:

"Friday March 7, 10:43 am ET
By Jeannine Aversa, Associated Press Writer
Federal Reserve Announces Bigger Auctions to Banks to Help Ease the Credit Crisis

WASHINGTON (AP) -- The Federal Reserve is taking bigger steps to ease the nation's credit crisis, including increasing the amount of loans it plans to make available to banks this month to $100 billion.

The Federal Reserve announced Friday that it will boost the size of auctions planned for March 10 and March 24 to $50 billion each. That is up from the $30 billion limits it had previously announced. The auctions serve as short-term loans to get banks the cash they need to keep lending to their customers.

The Fed, in a statement, said it planned to continue the auctions for at least six months, and would move to even larger auction amounts if needed.

In a second step, the Fed said it will make $100 billion available to a broad range of financial players through a series of separate transactions starting on Friday.

The Fed has been working to pump billions of dollars into the banking system to aid an economy rocked by the subprime mortgage crisis and the severe tightening of credit. The central bank started its new type of auction in December to provide short-term loans to cash-strapped banks in hopes of keeping them lending. So far, the Fed has made available a total of $160 billion in short-term loans to banks through six auctions."

Why pay interest to depositors, when they can borrow very cheaply from Ben Bernenke, who is printing
money like mad dog. Our savings will become worthless because the hidden inflation is eroding the value of the Dollar.

1
Comment #2 by Anonymous posted on
Anonymous
True, financial institutions can borrow at 3% from Ben, and refinance
the old debt with more almost free money. Customer deposits are secondary and irrelevant.

1
Comment #3 by Anonymous posted on
Anonymous
I thought only third world countries print money to solve an economic problem.

Does Ben knows that printing
money only creates a bigger problem down the road?

Cheap money for sure will destroy any economy and the Dollar.

The hidden inflation is already eating up our savings and the incentive to save is already gone.

1
Comment #4 by Anonymous posted on
Anonymous
And the money will only be available to the people who need it the least. The super rich will get richer...

1
Comment #5 by Anonymous posted on
Anonymous
Greenspan created the real estate bubble with interest rate down to 1%,
now Ben, by coping his teacher, thinks he can solve the problem with cheap money. How irresponsible and incompetent thinking by Ben.

Is there anyone who can tell Ben not to make same mistake with cheap money?

1
Comment #6 by Anonymous posted on
Anonymous
According to the report posted here,
Ben will print money for at least 6 month, and the already printed money so far, will create 1(one) trillion of worthless money floating around.

That is enough to destroy the Dollar and all of our savings in the Banks.

Ben acts like a drunken sailor and is throwing our hard earn and saved money to the vultures.

1
Comment #7 by Anonymous posted on
Anonymous
Forget the Dollar, Ben already destroy it, now he is working to destroy our hard earn savings, any assets we have left and our standard of living.

Does Ben knows basic economics?

I don't think so. Such incompetent Fed chairman should be replaced immediately.
But, who do you tell that.
Congressmen are not any better, they appointed him and blindly believe him. Now what we do?

Sam

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Comment #8 by Anonymous posted on
Anonymous
The prosperity of our nation depends on one person. Hmmm!

How on earth we put ourselves in this position?

Is there any higher body of power to slap Ben and wake him up from his trans.

Mike

1
Comment #9 by Anonymous posted on
Anonymous
What happen to Fisher and Cohn?
Are they of any value to be consulted?

I forgot, they ponder the the BIG BOSS and refuse to confront Ben.

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Comment #10 by Anonymous posted on
Anonymous
Not only that posted as in 1st comment but this:

"....... Secondly, the Fed said it will initiate a series of term repurchase transactions that are expected to cumulate to $100 billion.

These transactions will be conducted as 28-day term repos in which primary dealers may elect to deliver as collateral agency mortgage-backed securities if they so choose.

The Fed said it would consider increasing both the repos and the TAF if conditions warrant.

The Fed said to add increased certainty to financial markets it would continue to conduct TAF auctions for at least the next six months unless evolving market conditions clearly indicate that such auctions are no longer necessary.

The Fed has already provided $160 billion in short-term loans since mid-December in six auctions. ...."

Which means, taxpayers will bail out Financial Institutions by buying their worthless securities as collateral for freshly printed new money.
How stupid is that?

1
Comment #11 by Anonymous posted on
Anonymous
The Fed knows that there will be public outcry if bailing out Banks is public, therefore, Ben chose to stab the American people in the back by doing what is he doing.

They think we are stupid and ignorant of their actions. If we continue to be lame, we deserve it. Congress is on the side of corporate America, and only hope is to post frustrations like all of these comments above.

We are ****ed!

1
Comment #12 by Anonymous posted on
Anonymous
Congress talks tough, but has no teeth.

".......Mr. Mozilo, Mr. Prince and former Merrill Lynch & Co. Chairman and CEO E. Stanley O'Neal have come under fire from the panel for the compensation and retirement packages they received from their respective companies. Committee Chairman Henry Waxman (D., Calif.) has raised questions about whether the outsized compensation received by the executives during the current market turmoil was in the best interests of shareholders.

Mr. Waxman noted Friday that Mr. O'Neal received a $161 million retirement package when he left Merrill Lynch, Mr. Prince was awarded a $10 million bonus and $28 million in unvested stock options from Citigroup, and Mr. Mozilo has received more than $120 million in compensation and the sale of Countrywide stock.
That compensation was received while the three companies were reporting billions of dollars in losses and shares of their stock were seeing significant declines.

"Any reasonable relation between their compensation and the interests of their shareholders appears to have broken down," Mr. Waxman said in his opening statement. He asked, "How can a few executives do so well when their companies do so poorly?"

William Galvin, secretary of the commonwealth of Massachusetts, said Congress needs to "hold the promoters of these exploitative financial arrangements responsible."

"Many of these investment banks reaped enormous profits from the rampant mortgage lending and securitization .. and their executives have been handsomely rewarded," Mr. Galvin said in his testimony. "We, however, are now left sorting out the ongoing damage that is ripping through our financial system."

They are just public relation damage control body. Talk is cheap and they all end up without any actionable findings. People always lose, no matter what the Congress says.

1
Comment #13 by Anonymous posted on
Anonymous
I forgot to add this, before the panel took lunch break:

"...........The panel's top Republican, Rep. Tom Davis of Virginia, decried the hearing as a "sanctimonious search for scapegoats."

"Punishing individual corporate executives with public floggings like this may be a politically satisfying ritual -- like an island tribe sacrificing a virgin to a grumbling volcano," Mr. Davis said. ........."

You make your own judgment. This is how Congress wastes the time, instead of working for the people and find a solution to the problem.

1
Comment #14 by grobe (anonymous) posted on
grobe
None of the people who have commented have noted the obvious: we have an election in November. The obvious goal is to keep the economy doing as well as possible until then so the Republicans will do well in the election.

Certainly in any normal world, if banks were "cash-strapped" they would be raising interest rates to pull in more cash.

1
Comment #15 by Anonymous posted on
Anonymous
I just checked my OneUnited account. Looks like they dropped their APY to 4.00 this morning.

1
Comment #16 by Anonymous posted on
Anonymous
Banks no longer need depositors money. They can get it for almost free from Ben or they can sell him worthless piece of paper as collateral.
Ben stab us (the savers) in back.

1
Comment #17 by Anonymous posted on
Anonymous
How naive are we?
Elected or appointed officials never protect the people, they always protect corporate America.

Ben not only stabbed us, but he showed us the finger, and implied not to count on him anymore to work for the people as his mandate demands.

He is corporate monger all the way.

1
Comment #18 by Anonymous posted on
Anonymous
Banks cried wolf, Ben sent them the Lambs (the people), to feast and rejoice forever after. Not far fetched enough, then we are stupid for believing in public officials to protect the people.

1
Comment #19 by Anonymous posted on
Anonymous
It is not the cash the Banks needed, they wanted to sell the worthless pieces of collateral papers they hold for full face value to Ben. Now they got it on our expense and loss, and they got bailed out for free.

People always lose when corporate America cry.

1
Comment #20 by Anonymous posted on
Anonymous
Banks said in a letter to Ben that they will stop lending unless someone buys their worthless collateral paper. Ben politely obliged to them.
There was never a cash problem for the Banks, it was a cheap shut at the people of America.

1
Comment #21 by ShraZZy (anonymous) posted on
ShraZZy
Grand Yield Direct also down 3.85% from 4%

1
Comment #22 by Anonymous posted on
Anonymous
Why save!

Inflation is hidden from us and is at least twice as big than we are let to believe.

Banks have cheap supply of cash.

Ben is bailing out corporate America.

Feds are printing money to satisfy the Bank's hunger.

Ben is buying worthless pieces of real estate paper from the Banks.

We get punish for being savers.

I give up saving money and will spend it how I please from now on.

1
Comment #23 by Anonymous posted on
Anonymous
True, any money saved bellow the inflation rate is free money to the Banks. After the taxes we lose twice as much than we saved. Bummer!

1
Comment #24 by Anonymous posted on
Anonymous
Like Anonymous posted at 11:24 One United dropped their rate to 4.00%Keeping in mind interest is posted quarterly I will be gone from there on April 1st. Never was very fond of this bank but their above average rates kept me there. No reason to stay now.

1
Comment #25 by Unhappy American (anonymous) posted on
Unhappy American
I posted a while ago (and Bank Guy picked up on it) that OneUnited would slowly lower their rate. There is no way OneUnited or any bank can afford to pay such high rates on a checking or savings account.

Now that OneUnited is down to the same rate as ING Checking and others, there is no reason anyone should keep their money with OneUnited, since they post interest quarterly. If everyone now pulls their money out of OneUnited, OneUnited will be forced to change their interest postings to monthly.

Anyway, OneUnited and others like WaMu Online Savings and ING Checking will continue to lower their rates below 4% as the Fed Funds Rate will be cut, as confirmed today by President Bush. The Fed Funds Rate will go down to 2% and maybe more this year, which means bank and CU rates will fall and fall and fall.

1
Comment #26 by Anonymous posted on
Anonymous
When rates are going down, there is no point to switch Banks.

Sooner or later, they all wind up at same level.

Waist of time for few extra dollars.

1
Comment #27 by Unhappy American (anonymous) posted on
Unhappy American
Yes, in general, you are correct that most banks are the same rate. But...99.9% of all banks post interest monthly. OneUnited posts quarterly. My suggestion is for people not to put their money in a bank that posts quarterly. It is not fair that a bank posts quarterly instead of monthly if their rate is the same as all the other banks.

1
Comment #28 by Anonymous posted on
Anonymous
Ha! Such chiding remarks aimed at poor Ben. He has a PhD in Economics, was a professor at the top economics program, and is one the most respected macro economist of our times. Who are you???
The Fed is doing what it thinks best to aviod a recession...which will have much much dire consequence that you having interest rate reduced in your meager savings account! Grow up and let Ben do his job.

1
Comment #29 by Anonymous posted on
Anonymous
...and by the way...the Fed does not print money. The treasury does that. And these fiscal and monetary sections of the goverment are completely independent. Read a little before making childish remarks on Ben.

1
Comment #30 by Anonymous posted on
Anonymous
Your correct...The Treasury prints the money and won't do it until Ben places his order...lol

I'm sure the Feds are doing what they think is best to cover up mistakes and greed by the banks and mortgage companies...Problem is that I don't see them really fixing or helping anything; only putting off and delaying things. Robbing Peter to pay Paul is the way most Americans manage money these days (including our government). Sooner or later, we're all going to sink, and us responsible people will be weighted down with the rest. The end is near....

1
Comment #31 by Anonymous posted on
Anonymous
To Anonymous, at 7:50 and 7:51.

I have a PhD in Economics, but that does not make me an expert in economics.

Ben actions are amateurish and irresponsible, period. Increasing money supplies under these circumstances is wrong. Liquidity is a ratio of trust in Bank's system and borrowers needs and not excessive money poured in the Banks. Buying worthless Bank debentures without questioning what is in it, is stupid move by Ben.

Furthermore, most of the posts above are correct, except yours.
You are ignorant and uninformed to what Ben is doing out there.

He is bailing out the Banks, raises the inflation, postponing correction, yes Ben gives the order for the money to be printed, flooding cheap money into the banking system, lowering interest rates artificially, destroying the Dollar and on and on.........

Fred

1
Comment #32 by Anonymous posted on
Anonymous
To Anonymous of 7:50, Fred is right.

Also, recession can not be stopped by lowering interest rates at this stage of the game. Banks are not lending because of worthless real estate paper they hold and not a lack of money. Actually, they have to much money on hand and the interest paid on deposits will sink further.

Second, Ben action is criticized by Europeans, Japanese and Australian Governments as irresponsible and unneeded cuts in interest rates.
All of commodities and oil are artificially high, because of cutting rates and trashing the Dollar.
Learn the facts, before you start attacking the previous posters.

1
Comment #33 by Anonymous posted on
Anonymous
To Anonymous of 7:50,

When we see the phrase Feds, we all know it is all of the Federal Government's departments, starting from labor and statistics and .... all the way up to FOMC and Treasury.

We don't need your uneducated input.

1
Comment #34 by Anonymous posted on
Anonymous
To Anonymous of 7:50,

Defending Ben because he has a PhD is like defending a murderer by tell to the judge he must be freed because he is educated and can not go to prison.

1
Comment #35 by Anonymous posted on
Anonymous
To Anonymous of 7:50.

You must be the same guy from few weeks ago posting under the name of SVG, are you?

1