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I’m not following: If the higher risk is a net benefit, then those riskier banks should be able to pay higher returns on your deposits. Why don’t they?
by zmgsabst 3y ago
I’m not following:
If the higher risk is a net benefit, then those riskier banks should be able to pay higher returns on your deposits. Why don’t they?
- thriftwy 3y agoI believe the China model was to pay abysmal returns for bank deposits and use that to fuel economy, but now we have discovered that in the USA a very similar scheme is implemented when you place your money into lion's mouth basically for free.
- Hermitian909 3y agoThe hypothesis is that the net benefit to society is higher. The banks can only offer higher returns based on the value they capture, which might be a lot less than they produce.