Article by Kirk Lindstrom: I wish Bob Brinker would talk more about how savers in the US are bailing out over spending politicians and the banks via extremely low interest rates. Those of us who didn't buy houses we could not afford with "normal interest rates" and who have saved money are probably paying more via reduced interest income than "regular tax payers." FOR SURE we are certainly paying far more (in lost income relative to inflation) than folks who "lived larger" than they could afford then left the banks, taxpayers and savers to pay for their excesses when their homes were foreclosed and/or abandoned.
"Highest CD Rate Survey + Current US Treasury Rates"
Vanguard Money Market Rates shown for Reference
Full CD Rate Table at Very Best CD Rates
"Highest CD Rate Survey + Current US Treasury Rates"
| Term | Highest Rate (APY) | Where? (Click link for Full Rate Sheets) |
| Vanguard Daily | 0.09% | Vanguard Prime Money Market Fund |
| 6 Month CD | 1.23% | Aurora Bank |
| 1 Year CD | 1.55% | Sallie Mae Bank & 1.50%@ Discover Bank |
| 1 Yr US Treasury | 0.29% | US Treasury Rate Quote |
| 18 - Month CD | 1.71% | Aurora Bank |
| 2 Year CD | 2.00% | Stonebridge Bank & Bank of Internet USA |
| 3 Year CD | 2.50% | newDominionDIRECT |
| 4 Year CD | 2.92% | Bank of Internet USA |
| 5 Year CD | 3.06% | Astoria Federal Savings Bank |
| 5 Yr US Treasury | 1.83% | US Treasury Rate Quote |
| 7 Year CD | 3.51% | Pentagon Federal CU aka PenFed |
| 10 Year CD | 3.50% | Discover Bank |
| 10 Yr US Treasury | 3.04% | US Treasury Rate Quote |
Full CD Rate Table at Very Best CD Rates
How many of you remember getting double digit interest rates on money market funds and CD accounts in the 1980s?
Currently, year-over-year CPI inflation is at 2.0% yet the top 2-YR CD term of the five largest banks is only 1.50% at Chase Bank! We are losing money, when adjusted for inflation, by holding it in safe CDs, savings accounts and especially US Treasuries!!
I heard on CNBC-TV that banks have over one trillion US dollars above what they need to be "well capitalized" yet they don't lend it out because they are afraid they won't get it paid back. I suspect there is more to it such as they still have bad mortgages on their books that will require that capital if we get a double dip recession so they are being safe. Since they have all this money, they have no incentive to pay high interest rates to attract more deposits.
I heard on CNBC-TV that banks have over one trillion US dollars above what they need to be "well capitalized" yet they don't lend it out because they are afraid they won't get it paid back. I suspect there is more to it such as they still have bad mortgages on their books that will require that capital if we get a double dip recession so they are being safe. Since they have all this money, they have no incentive to pay high interest rates to attract more deposits.
| Bank | CD Rates - APY in % as of 7/9/10 for $10,001 | ||||
| 6- Mo | 12 Mo | 2-Yrs | 3-Yrs | 5-Yrs | |
| Bank of America (BAC) | 0.35 | 0.80 promo | 1.10 | 1.75 | 2.50 |
| JP Morgan Chase (JPM) Bought WaMu | 0.50 7-mo | 1.01 13-mo | 1.50 | 2.00 | 2.50 |
| Citibank (C) | 0.35 | 0.75 | 1.01 | 1.50 | 2.25 |
| Wells Fargo Bank (WFC) Bought Wachovia | 0.15 | 0.30 | 1.40 27 Mo | 1.90 35 Mo | 2.65% 58 Mo |
| HSBC Bank North America - Branch Rates | 0.10 | 1.01 | 0.75 | 0.75 | 1.70 |
| HSBC Online Rates | 0.10 | 1.01 | 0.75 | NA | NA |
| US Treasury Rates | 0.19 | 0.28 | 0.62 | 1.01 | 1.84 |
See the full survey at CD Rates at Largest US Banks
It is amazing to me how CD rates have worked their way down to nearly nothing since I graduated UC Berkeley in 1979.
Check out these historical CD rate graphs
| 1-Month CD Daily Chart Click charts to see full size images |
 |
| 6-Month CD Daily Chart |
 |
With rates so low, banks will try to sell you their annuity products. Make sure you read my article: Beware of Annuities
