I am surprised you think that the deposit market is that liquid and yield-driven enough to claim I’m making errors! To answer your question, I along with most

I am surprised you think that the deposit market is that liquid and yield-driven enough to claim I’m making errors! To answer your question, I along with most Americans will keep it in my checking account because I use it as a working capital account and not an investment account. The median consumer checking account balance is <$10k and hasn’t yielded anything above 1% in a generation. [0] I will keep a relatively flat balance in my checking account indefinitely - long enough for the Treasuries to cycle. Your argument works for banks like Schwab, but BoA’s deposits don’t look the way you think they do. Americans looking for yield never put their money into places like BoA anyway (it’s not like they ever competed on rates as long as anyone can remember). Besides, wouldn’t we have already seen the flight if that was going to happen? Why now are depositors going to wake up to higher yields at smaller institutions? To date, BoA’s deposits are roughly following the trend of all deposits [1] [0] https://www.jpmorganchase.com/institute/research/household-income-spending/household-pulse-cash-balances-at-year-end https://www.jpmorganchase.com/institute/research/household-i... [1] https://fred.stlouisfed.org/series/BOGZ1FL193020005Q https://fred.stlouisfed.org/series/BOGZ1FL193020005Q