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How important are retail deposits at this point, with all this new QE money flowing in. It almost seems like a drop in the bucket for the big financial compani

How important are retail deposits at this point, with all this new QE money flowing in. It almost seems like a drop in the bucket for the big financial companies. Even if not, aren't they getting most of the benefit from dark pattern fees instead of from doing what banks are supposed to do - invest the pooled money wisely and extract a better return than individuals could?

supertrope 5y ago
https://www.wsj.com/articles/banks-to-companies-no-more-deposits-please-11623238200 https://www.wsj.com/articles/banks-to-companies-no-more-depo...
aidenn0 5y ago
I'm responding to TFA which claims that banks have such a large supply of retail deposits that higher rates will just lead to banks extending more credits. If retail deposits don't matter than TFA is completely irrelevant.
blitzar 5y ago
They are irrelevant. Banks need deposits to opperate. They can borrow unlimited quantities for 0 at the fed or go through the hassle and expense of having millions of retail deposit accounts. The chose free money on one phone call every time over dealing with retail every time. If the fed stops being the source of funds, expect a free toaster if you open a savings account and a pre 2008 style competition for deposits, in particular fixed term deposits. A long way off still. > benefit from dark pattern fees instead of from doing what banks are supposed to do - invest the pooled money wisely and extract a better return than individuals could Banks make fuck all on your dark patterns and shittons on investing the money.
- diordiderot 5y ago
  For big banks overdraft fees represent 5~10% of revenue, for small banks it's 40~50%
  - blitzar 5y ago
    Its sometimes 200%+ of profits. First National Bank of Texas (doing business as First Convenience Bank) made over $100 million in overdraft fees yet posted an annual profit of just $36 million in 2020 Giving people money when they dont have any and charging them for the pleasure of not having their rent cheque bounce or be unable to buy any food for a week is hardly a dark pattern. Personally I would do away with overdrafts all together and solve the problem. But that isnt going to be a popular opinion and people would compain that people are unable to buy groceries or pay their rent.
    - aidenn0 5y ago
      There are some banks that have done shady things like posting all withdrawls for the day before all deposits, which greatly increases the likelyhood of an overdraft.

supertrope 5y ago

https://www.wsj.com/articles/banks-to-companies-no-more-deposits-please-11623238200 https://www.wsj.com/articles/banks-to-companies-no-more-depo...

aidenn0 5y ago

I'm responding to TFA which claims that banks have such a large supply of retail deposits that higher rates will just lead to banks extending more credits. If retail deposits don't matter than TFA is completely irrelevant.

blitzar 5y ago

They are irrelevant. Banks need deposits to opperate. They can borrow unlimited quantities for 0 at the fed or go through the hassle and expense of having millions of retail deposit accounts. The chose free money on one phone call every time over dealing with retail every time. If the fed stops being the source of funds, expect a free toaster if you open a savings account and a pre 2008 style competition for deposits, in particular fixed term deposits. A long way off still. > benefit from dark pattern fees instead of from doing what banks are supposed to do - invest the pooled money wisely and extract a better return than individuals could Banks make fuck all on your dark patterns and shittons on investing the money.

diordiderot 5y ago
For big banks overdraft fees represent 5~10% of revenue, for small banks it's 40~50%
- blitzar 5y ago
  Its sometimes 200%+ of profits. First National Bank of Texas (doing business as First Convenience Bank) made over $100 million in overdraft fees yet posted an annual profit of just $36 million in 2020 Giving people money when they dont have any and charging them for the pleasure of not having their rent cheque bounce or be unable to buy any food for a week is hardly a dark pattern. Personally I would do away with overdrafts all together and solve the problem. But that isnt going to be a popular opinion and people would compain that people are unable to buy groceries or pay their rent.
  - aidenn0 5y ago
    There are some banks that have done shady things like posting all withdrawls for the day before all deposits, which greatly increases the likelyhood of an overdraft.