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Banks Want Higher Interest Rates

Friday, November 15, 2013 - 7:52 AM
Savers are not alone in a wish for higher rates. According to this Bloomberg article:
the Fed’s low-interest-rate policy has been a mixed blessing for banks. Along with lowering their borrowing costs, it’s limited what they can charge on loans and earn on other investments. The difference between the two—the net interest margin—has been declining since 2010.

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5
Ken TuminKen Tumin5,469 posts since
Nov 29, 2009
Rep Points: 125,077
1. Friday, November 15, 2013 - 9:10 AM
"Savers are hurting after a 30-year run during which interest rates fell from a high of 20 percent to near zero, where they’ve been stuck since 2008. Customers tired of low yields may be quick to seek out competitors offering more attractive deposit rates, setting off bidding wars among banks, according to Nancy Bush, an independent analyst. “The banks won’t have the luxury of lagging deposit rates this time,” she says."

Let the wars begin!
3
ShorebreakShorebreak2,621 posts since
Apr 6, 2010
Rep Points: 14,208
2. Friday, November 15, 2013 - 9:38 AM
Great!  Finally some "maybe" good news about interest rates.  I wonder how Yellen feels about this latest news about the banks since she has a far off date for raising.  Maybe we can get a new "Banks and Savers Want Higher Interest Rates" Petition and get all the banks to sign! 

This would be one "War" I would be in favor of.
3
paoli2paoli21,372 posts since
Aug 10, 2011
Rep Points: 6,011
3. Sunday, November 17, 2013 - 8:50 AM
Janet Yellen, in her congressional testimony, has seemingly declared any chance of "bidding wars among banks" to be over before they erupt.
1
ShorebreakShorebreak2,621 posts since
Apr 6, 2010
Rep Points: 14,208
4. Sunday, November 17, 2013 - 10:44 AM
#3   And how does Yellen plan on putting a stop to it?   Is the Fed going to control the banks completely and tell them how they can and cannot run their business?  I wouldn't be surprised the way this government is going.
2
paoli2paoli21,372 posts since
Aug 10, 2011
Rep Points: 6,011
5. Sunday, November 17, 2013 - 11:50 AM
The stress tests control what they can do. The stronger they are the higher interest they can give and charge. So let them pass the test.  

Actually many were somewhat controlled after the S&L crisis. 
1
Ally6770Ally6770912 posts since
Jan 16, 2010
Rep Points: 2,655
6. Sunday, November 17, 2013 - 11:58 AM
You know Ally, that makes good sense.  That also is the reason I try to stick with the banks with the most stars on Bankrate and Bauers.  Even if they have good ratings I double check their figures for signs of future problems.  Penfed only is a 4 star cu but I think it is in good standing for what I am looking for.  This coming week I hope to get those CDs to replace the ones maturing.  I like them  because the ones I want only have a 6 month EWP for "just in case".  
1
paoli2paoli21,372 posts since
Aug 10, 2011
Rep Points: 6,011
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