Dedicated to Deposits: Deals, Data, and Discussion
Featured Savings Rates
Featured Accounts
Back to Financial News

What’s Behind Our Skyrocketing Savings Rates

Thursday, May 5, 2011 - 8:11 PM
This isn't skyrocketing savings account rates. It's the amount of money people are savings. People are saving more these days, and this US News article reviews what's behind it.

Higher savings rates is good news for the long-term health for the economy, but it's not helping our deposit rates. The more deposits that banks have the less they need to offer high rates to attract deposits.
3
Ken TuminKen Tumin5,442 posts since
Nov 29, 2009
Rep Points: 123,713
1. Thursday, May 5, 2011 - 8:55 PM
Oh darn, I'm saving too much. Therefore pay me less interest. Thus, if I spend every penny I have then interest rates will soar. What a load of malarkey.
2
ShorebreakShorebreak2,375 posts since
Apr 6, 2010
Rep Points: 12,681
2. Friday, May 6, 2011 - 5:56 AM
My hope was with the market doing well money would have gone from savings into it? I remember during the market boom of the late 90's that seemed to make banks pay higher to keep deposits but not happening now.
1
scottjscottj27 posts since
Jun 5, 2010
Rep Points: 727
3. Friday, May 6, 2011 - 8:33 AM
"I remember during the market boom of the late 90's that seemed to make banks pay higher to keep deposits but not happening now."

That was when banks were loaning money out like crazy and they really needed deposits. The economy was over-heating with the "dot-com bubble", housing was well on it's way to a boom in prices and Mr. Greenspan was out there saying there was no bubble, but the Treasury traders knew the real story and yields were rising. A different situation than today, in which rampant speculation is at work in the market casino and commodity trading, while "Helicopter" Ben Bernanke is printing money out of thin air like there's no tomorrow.
2
ShorebreakShorebreak2,375 posts since
Apr 6, 2010
Rep Points: 12,681
Reply