6 ms·
a “run” can simply be a wake up call to wealthy people with hundreds of thousands or millions in some 0% earning checking account to funnel that money into a mo
by tempsy 4y ago
a “run” can simply be a wake up call to wealthy people with hundreds of thousands or millions in some 0% earning checking account to funnel that money into a money market or t-bills earning 4-5%.
that would alone create some outflow even if the reason is not panic
- arbuge 4y agoThat dynamic, known as cash sorting, had already been going on for several months, and appeared to be stabilizing. If anything, I think the events of the last few days could reduce it somewhat. Better to have your funds safe earning little in a Big 4 bank than somewhere else with higher rates but now perceived to be risky.
- jliptzin 4y agoI happened to check what my citibank savings account pays these days...0.12% interest. Not that I keep any significant amount of money there, anyway. I would if they would pay remotely close to competitive interest rates, but I guess they're banking on most people being too dumb to realize that they can get 4-5% more on their money if they take 5 min to open an account elsewhere.
- kortilla 4y agoSome banks are even offering the better rate if you open a different account with the same bank. They are definitely depending on people not noticing.
- hypothesis 4y agoMight as well buy treasuries with higher rates and tax benefits. Should not take much longer to setup…
- garyfirestorm 4y agoCouple of weeks ago I opened a Citi High Yield Savings account ~3.5% interest rate. Took less than 30 seconds to open the account.
- jaywalk 4y agoI have a checking account that pays 0.1% APY. Savings account is at 3.6% APY. You are getting screwed.