CDs Fall Below 1% Frist Time Since '50s

**Big Smoothy** · 11-11-2010, 07:12 AM

CDs Fall Below 1% First Time Since ’50s - Stocks To Watch Today - Barrons.com

CDs Fall Below 1% First Time Since ’50s

Fewer people are taking out loans, and banks are just delighted to offer them less and less for the privilege: Even as consumer debt continues to wind down, banks are showing less inclination to ease terms of loans, and the payoff they’re offering for various consumer deposits just keeps going lower.

Dow Jones Newswires’s Katy Burne this afternoon reports that rates on certificates of deposit, considered the “pillow” among U.S. consumer deposit products, fell below 1% for the first time since the 1950s, according to data by Market Rates Insight.

The average CD yield today is 0.98%, the firm notes, having fallen below 1% on average last month. Market Rates tracks data going back 20 years, but by using Fed Reserve data, writes Burne, the firm has been able to estimate that the current rate is lower than it was in the early ’50s.

Savings accounts and other products had already fallen below 1% this summer, and CDs were the last to go.

This comes as the latest Fed Reserve survey notes consumers continued to pare their debts overall in Q3, with total credit of $11.6 trillion falling almost 1% from Q2, according to the writeup by the Journal’s Deborah Lynn Blumberg.

That sounds about consistent with the Fed’s survey of loan officers at 57 domestic banks in October showed that fewer banks were increasing their willingness to loan than was the case in previous surveys, and “small net fractions of banks reported having tightened spreads of interest rates on credit cards over their cost of funds and reduced the size of credit lines on existing credit card accounts.” While large banks saw an increase in demand for consumer loans, other banks were saying demand fell.

**GearsMcGilf** · 11-11-2010, 08:29 AM

No worries. Obama's got it all under control.

**Dark Geared God** · 11-11-2010, 03:21 PM

that crazy obuma

**Dale Mabry** · 11-11-2010, 04:46 PM

I don't listen to CDs anyway.

**Doublebase** · 11-11-2010, 06:28 PM

Explains why the stock market has been doing well recently. It is the only place to really make money these days.

**vortrit** · 11-11-2010, 07:53 PM

Originally Posted by Dale Mabry

I don't listen to CDs anyway.

I don't either. I bet ipods are doing pretty good.

**LAM** · 11-11-2010, 08:28 PM

Originally Posted by vortrit

I don't either. I bet ipods are doing pretty good.

Apple is making money hand over foot, employees get no discounts on their products everyone pays full price.

**vortrit** · 11-11-2010, 11:19 PM

Originally Posted by LAM

Apple is making money hand over foot, employees get no discounts on their products everyone pays full price.

From what I've seen Apple employees get some pretty good benefits, so big deal if they have to pay full price for an ipod. If they are working for Apple they can probably afford it anyway.

**bmw** · 11-12-2010, 02:28 AM

I download my music from the interwebs for free.

**Big Smoothy** · 11-12-2010, 02:50 AM

Originally Posted by Doublebase

Explains why the stock market has been doing well recently. It is the only place to really make money these days.

Is the stock market operating under actual conditions, or is this just a "dead cat bounce?"

Nobody is bullish long-term at the moment.

**LAM** · 11-12-2010, 09:27 AM

Originally Posted by vortrit

From what I've seen Apple employees get some pretty good benefits, so big deal if they have to pay full price for an ipod. If they are working for Apple they can probably afford it anyway.

"typically" when you work for those kinds of big companies you get some kind of discount. every billion dollar company that I worked for we always got discounts on all sorts of goods and services from a variety of companies, it's just being plan old cheap on the behalf of Apple.

**lnvanry** · 11-12-2010, 11:25 AM

Originally Posted by Doublebase

Explains why the stock market has been doing well recently. It is the only place to really make money these days.

You do realize the Dow is still -15% over the past 3 yrs right? The DOW is up 7% since Jan 1, 2010...Thats not exactly big returns. Point being, the stock market isn't doing "that well". Its just getting back to where it was pre crash in late 2008 and early 2009. Most people are getting close to "getting back" what they lost

**ebn2002** · 11-12-2010, 01:31 PM

There is a lot of risk in bonds (not municipals) with a 10+ year duration, more risk than high quality dividend paying stocks with twice the yield. People will rush to stocks when interest rates go up and their bonds go down the tubes. Keep the duration on your fixed income portfolio low, under 5 years. Or buy floating rate funds that will move up with interest rates.

JMHO.

**vortrit** · 11-12-2010, 03:54 PM

Originally Posted by LAM

"typically" when you work for those kinds of big companies you get some kind of discount. every billion dollar company that I worked for we always got discounts on all sorts of goods and services from a variety of companies, it's just being plan old cheap on the behalf of Apple.

Most employees at Apple are probably making a decent wage, and are getting benefits. There are a lot of companies that don't give you anything on discount or for free. If you work at a KFC you don't get free meals or a discount, so you are crazy if you think I'm going to start feeling sorry for the people at Apple for not getting a discount. That's the most ridiculous thing I've ever heard, and welcome to corporate America.

Maybe someday UNICEF will get into the ipod business.

**SFW** · 11-12-2010, 04:04 PM

does anyone have anything invested in emerging market funds?

**Retlaw** · 11-12-2010, 04:47 PM

CDs nuts !

**bmw** · 11-12-2010, 05:03 PM

Originally Posted by Mr. Fantastico

does anyone have anything invested in emerging market funds?

yes.

I couldn't tell you off the top of my head how it's doing though.

**maniclion** · 11-12-2010, 05:07 PM

Originally Posted by LAM

"typically" when you work for those kinds of big companies you get some kind of discount. every billion dollar company that I worked for we always got discounts on all sorts of goods and services from a variety of companies, it's just being plan old cheap on the behalf of Apple.

Even at our small company we get 5% over cost....I got my Photovoltaic system for 30-40% less than retail so my payoff comes much quicker...

**ebn2002** · 12-22-2010, 01:32 PM

Originally Posted by Mr. Fantastico

does anyone have anything invested in emerging market funds?

Half my 401k is in Emerging Markets. BofA says emerging markets will be 80% of the world's growth next year.

I cant post links, google "bank of america emerging markets" for the article.

**Big Smoothy** · 12-22-2010, 06:16 PM

^ That seems good at the moment.

I have my international & emerging markets and domestic, but honestly those of us in the 401K and IRA situations may very well get - f*cked.

I have my cash in a Western bank in Vietnam getting 11% interest.

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