whisperonthewind

Fear and Loathing in 2009

Another thought - the banks could even offer 1% for the first 30 days, 2% for the next 30 days, 3% for up to 90 days, and then go from there in .25% increments. Or .1% increments. But give us an incentive to start putting our money in banks - the current interest rates on savings aren't worth the time.


On Dec 24 01:51 PM whisperonthewind wrote:

> With the economy on the brink of ruin, today's word is return. We
> want a return on our investment too, and the banks want people to
> start using them again. 50 years ago, the banks had interest bearing
> savings accounts with an interest rate comparable to our CDs today.
> 3 and 4% were normal, and everyone put money into savings accounts.
> The banks were happy, the people were happy, the borrowers were happy.
> Now, those same depositors are not getting that kind of interest
> unless they have buckets of money in those banks. Since most of
> us don't even own a bucket, we're pushed aside. Our choice is to
> put that money into a CD and pay a penalty if we have an emergency.
> Isn't using the money and losing the interest enough of a penalty?
> Clearly not.
>
> So we turned to dividends, and most of us look for a minimum of 4%,
> and the companies that give those kinds of dividends seem to be weathering
> the storm better than those that do not. A piece of advice for the
> banks - start offering 4% interest on a savings account, with a minimum
> of 60 days in the account. This is less time than quarterly stocks,
> less time than CDs, and will encourage people to begin saving again.
> Better yet, offer 3% for savings under $100.00, 3.5% for $101 - $500,
> 4% for $500 - $1000, and maybe 4.25% up to $5000. People will begin
> to invest in the banks again, the banks will get stronger, people
> will be more confident, and the rest will follow.
>
> CDs aren't bad, and those of us who like them can continue to use
> them - perhaps the short term ones can be phased out and the long
> term ones be increased? Just because CDs work, that doesn't mean
> it's the only thing that works. Saving is a benefit to all of us,
> and it's better when we have a good reason to do it. Maybe 2009
> wouldn't be so bad after all.